Rent vs. Buy UK

Presets:
Year 10 Winner BUYING WINS
+£54,320

Buyer Equity vs. Renter ISA+GIA

Breakeven Horizon
Interpolated from Day 0 (Year 0) where the buyer starts in a negative wealth deficit due to Stamp Duty, legal fees, and exit estate agent fees.
25-Yr Term • 2yr Fix
2.4 Years

Claws back Day 0 fees in Month 29

Tax & LISA Impact SDLT (FTB)
Stamp Duty Paid: £0
Gov LISA Bonus: +£3,000
Renter CGT Paid: £410
Monthly Outflow 25-Yr Amortization
£1,536/mo

Reverts to £1,602/mo at Yr 3 vs £1,600 rent

Net Liquidated Wealth Trajectory (Year 0 to Year 10)

25-Yr Term • 2yr Fix @ 4.75% → 5.25%

Plots Day 0 (Year 0) upfront fee deficit and tracks when Buyer Net Equity overtakes Renter's ISA + GIA Portfolio

5x5 Sensitivity Heatmap Matrix

NEW v2.2

Click any cell to test that exact House Growth vs. ISA Return pair (10 years)

↓ House Growth \ ISA Return →
Buy Wins Rent Wins
Mortgage Interest & Fees £0
Stamp Duty, Legal & Upkeep £0
Tax-Free ISA Sheltered £0
Math & QA Audit Summary
1. Day 0 (Year 0) Net Wealth Deficit -£3,500 at Day 0

Buyer Day 0 Liquidated Equity (£43,500) vs Renter Day 0 Invested Cash (£47,000). Accounts for Stamp Duty, legal fees, exit agent fee & LISA bonus.

2. England SDLT (FTB Relief) £0 tax + £2,000 legal

0% nil-rate band up to £300k for First-Time Buyers. Upfront buying friction is £2,000.

3. 25-Yr Term & Overpayments £3,996 in fees

Starts at 4.75% for 2 yrs, then re-amortizes over remaining 23 yrs at 5.25% (+£999 fee every 2 yrs).

4. Renter £20k ISA + £3k CGT Harvest 94% ISA Sheltered

Upfront deposit migrates into ISA at £20k/yr (Bed & ISA). Total CGT drag on excess GIA gains above £3k/yr: £410.

Transparent Open-Box Financial Math

Methodology, HMRC Tax Bands & Data Sources

Built for r/UKPersonalFinance scrutiny

Buyer Net Wealth Formula

Equity = PropertyVal - Debt - SellingFee

Accounts for Day 0 personal deposit + Government LISA bonus (if FTB & price ≤ £450,000), monthly mortgage amortization + optional monthly overpayments across Initial Fixed Rate and Follow-on Rate, periodic Remortgage Product Fees (£999), and exit Estate Agent fees.

Renter HMRC ISA & GIA Engine

Portfolio = ISA_Bal + (GIA_Bal - CGT)

Renter starts with the Buyer's personal cash outlay (Deposit + Stamp Duty + Legal Fees). Up to £20,000/yr enters a tax-free Stocks & Shares ISA (with annual Bed & ISA transfers from GIA). GIA gains above the £3,000 Annual Exempt Amount are taxed at 18% or 24%.

Statutory Stamp Duty Bands

  • England/NI (SDLT): 0% to £125k, 2% to £250k, 5% to £925k. FTB: 0% to £300k, 5% to £500k (hard cliff-edge above £500k). +5% 2nd home surcharge.
  • Scotland (LBTT): 0% to £145k (£175k FTB), 2% to £250k, 5% to £325k, 10% to £750k. +8% ADS surcharge.
  • Wales (LTT): 0% to £225k, 6% to £400k, 7.5% to £750k.
Sources: HMRC Stamp Duty Land Tax Manual, Revenue Scotland LBTT, Welsh Revenue Authority, ONS Private Index of Private Housing Rental Prices, Moneyfacts UK Mortgage Trends. Disclaimer: For educational modeling only; does not constitute regulated financial advice.