Work out rent vs buy decision instantly with clear inputs, formula shown and shareable results.
The price to rent ratio divides the purchase price by twelve months of rent, and monthly ownership cost applies the interest rate plus running costs to the price. Ratios below 15 have historically favoured buying and above 20 favoured renting, though the result also depends heavily on how long you stay.
Price to rent ratio
ratio = purchase price / (monthly rent x 12)
Monthly ownership cost
cost = price x (interest rate + running cost rate) / 12
A simplified comparison that ignores capital growth, transaction costs and tax treatment. Not financial advice.
ratio = purchase price / (monthly rent x 12). The price to rent ratio divides the purchase price by twelve months of rent, and monthly ownership cost applies the interest rate plus running costs to the price.
Ratios below 15 have historically favoured buying and above 20 favoured renting, though the result also depends heavily on how long you stay.
Enter monthly rent, purchase price, mortgage interest rate, annual maintenance, tax and insurance. The defaults shown are a realistic worked example — swap in your own figures to get a result you can use.