Compare multiple rent and buy scenarios.
Scenario 1
Rent Calculation 1
You start with £30,000* as your investment capital, and it grows to £38,501, which is an increase of £8,501.
In addition, you also invested £100 per month, which grew to £6,801 after 5 years, which is an increase of £801.
In total, your investments increased to £15,301.
During this time, you paid £19,892 in rent and spent £100 on your agency fee, but got £300 back from your initial deposit.
Overall, you come out at -£4,391.
*The initial investment capital is not included, because we are calculating the net increase/decrease for both scenarios.
Renting for 5 years:
Scenario 2
Buy Calculation 1
You bought your property for £300,000 and sold it for £315,303 after 5 years.
During that time, you paid £68,664 in mortgage payments. £24,884 was interest, and you paid off £43,781 from the £270,000 mortgage principle, meaning you still owed the bank £226,219 at the time of selling.
Therefore, from the £315,303 sale money, £226,219 goes to the bank for your mortgage.
So, you actually received £89,084 from the sale.
Now, let’s go through the expenses:
- £68,664 in mortgage payments.
- £15,000 for maintenance and repairs over 5 years.
- £6,000 in buying and selling costs.
That leaves you with -£581.
But wait, there's also the £30,000 deposit, if you take that into account too, then overall you’ve lost -£30,581.
Buying after 5 years:
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