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Deciding whether to rent or buy is, by nature, one of the biggest life choices you can make. Though it can be hard to decide what's right for you, using a rent or buy calculator can help you put your options into perspective.

If you're one of the many still asking "Should I rent or buy?", then read on. We've answered some key questions to help you decide.


What does a rent or buy calculator do?

Deciding whether to rent or buy a home can be a complex financial decision. A rent or buy calculator can ease the burden.

A rent or buy calculator will let you plug in all the financial arithmetic behind your decision. You can then get instant feedback on things like your projected monthly payments, down payment, and cost over time.

By using a rent or buy calculator, you can get a clearer picture of which option makes financial sense for you. It should be one of the key tools you use to help you make your final decision.

What is the difference between renting and buying?

Renting and buying are two ways of achieving the same thing: having a property in which you can live.


When you rent, you don't own the property. You lease it as you would a car. For the duration of the lease, you can live in the property and use it within certain conditions set down by the tenancy agreement.


When you own a property, it's yours. You can do what you like with it provided you abide by local ordinances. You can lease it out, live in it, or fix it up to sell later on.


Financially, renting is a smaller commitment. It's easy to pack up and move elsewhere if you choose to and general maintenance issues will fall to your landlord to deal with.

Compared to buying a house, it's much less hassle and is quick to finalize.

However, owning a house opens up more options and gives you something you can keep for the rest of your life, if you choose to.

Is it cheaper to rent or buy a home?

This might be the trickiest part of the rent or buy debate.

To oversimplify, the basic answer to this question is this: renting is cheaper in the short term and buying is cheaper in the long term.

The reasons for this are simple.

The average rent is more expensive than the average mortgage, but buying a home requires a lot of up-front cash for a deposit. You'll need to have owned a home for some time before these even out.

Even then, buying a home is full of 'soft' costs like redecorating and replacing appliances. In rented homes, this is the responsibility of the landlord.

While it's rarely counted with the financials, it's worth considering the emotional cost, too.

Homeowners tend to be happier with their standard of living, but the process of buying a home is one of the most stressful around.

What are the advantages of owning a home?

Owning a home offers a number of options that renting doesn't.


You can redecorate an owned home and make architectural changes without violating the tenant's agreement as you would in a rented home.

Added Value

You can also use the home for other purposes. Renting usually prohibits sub-letting. In an owned home, you could rent the home out and act as its landlord.


Owning a home also ensures it's yours until you decide to sell. A landlord can choose to sell or occupy a rented home, so renters might find themselves evicted.


Additionally, a home is an investment that tends to appreciate over time. Any money that is put towards your home or mortgage increases your equity in the property.

Many homeowners can turn a profit when selling their home down the line. This is unlike renting, where the money is ultimately lost.

What are the costs of owning a home?

Owning a home comes with a more complex financial arrangement than renting.


By far the most common way to purchase a home is with a mortgage. Purchasing a home usually requires a down payment, with the rest of the cost covered by the mortgage.

This makes the deposit and closing costs the most immediately expensive part of the purchase.


Owning a home also means you're responsible for maintenance and repairs. Your insurance won't always cover these, so owning a property can be far more expensive if the property is in poor shape.

Can I rent out my house if I have a mortgage?

A standard mortgage doesn't come with provisions for your to rent out your property. Letting out your property without informing your lender could have financial repercussions.

Buy-to-let mortgages are an option for those planning to purchase a property for the purpose of letting it out.

If you have a standard mortgage and decide to rent your property, you'll need to inform your lender. Many lenders will grant permissions to rent for an additional fee.

Some lenders might allow you to rent your house out without any additional fees. But if you intend to rent your house out, then you should discuss this before you sign a mortgage agreement.

If you change your mind later, speak to your lender or loan originator before taking any action.

What else do I need to consider in my decision?

Without full knowledge of your financial situation and your future plans, no one can tell you whether renting or buying is right for you.

As an individual, you need to weigh up some key considerations. For instance, here are some things to consider:

  • Do you plan to remain in the same place for long?
  • Are you planning to expand your family?
  • Do you have a stable credit history?
  • How does your partner feel about renting or buying?

This is only a small sample of the individual personal questions which go into buying or renting a home. Before you make any decision, consider making a similar list of questions to answer.

So, should I rent or buy?

Unfortunately, the question "Should I rent or buy?" is the one question we can't answer for you.

That said, this guide should give you the knowledge you need to decide what's right for you. Renting or buying is a personal decision you'll make based on your finances and lifestyle.

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