In association with property adviser Savills, the Telegraph has built an interactive tool to help you compare the total cost of home ownership against the total cost of renting.
The model includes the various initial costs involved – such as a mortgage fee and stamp duty for buyers and the initial deposit for tenants – as well as the ongoing costs of paying your rent or servicing your mortgage.
The suggested figures on regional house price and rent changes are sourced from the Office of National Statistics, using an average figure from the past three years.
You can adjust these figures to see how your expectations of future house prices and rents will adjust the balance of whether it is better to rent or buy.
You can then set your monthly rent, the house price, your deposit and mortgage rates available for the properties you want to compare.
The model allows you see, given how long you expect to live somewhere, whether renting or buying is more expensive. Neal Hudson, a housing analyst at Savills, said: “The graphic is a useful tool for people considering what type of mortgage they should take out and how that would compare to their current cost of renting.”
He said: “This is particularly relevant given the recent announcement of Help to Buy II that is likely to increase the availability of 95pc LTV mortgage products, albeit at a higher mortgage rate.”
The tool calculates the net buying position by taking the remaining mortgage debt and other costs from the equity you have in the property. The net renting position is calculated by taking the rent and agency fees away from savings you would have if you saved a sum with interest rather than using it for a deposit. This is to provide a fair comparison between buying and renting.
When you start to save money from buying instead of renting is when the tool states you are better off as a homeowner.