Property decision · Lab
Sell or Rent Out Your House Calculator UK
Compare selling and investing the released equity, keeping the current property as a rental, or selling it to buy a purpose-selected buy-to-let on matched, after-tax assumptions.
1 Enter your figures2 Review assumptions3 Explore the result
Scope: personally owned UK residential property.The comparison uses the same starting resources and models a sale at the selected horizon. Company ownership, overseas tax and lender eligibility are excluded.
Your figures
Your entries stay in this tab and are not sent to Money Considered. A shareable link includes only the assumptions shown in its URL.
10-year comparison in today’s money
Sell and invest leads by £32,875The leading path ends with £372,203 after inflation, modelled tax and a sale at the horizon.Net equity if sold now£242,500After mortgage, selling costs and modelled CGT
Common starting resources£292,500Released equity plus additional cash
Extra tax if old home is retained£30,000Incremental tax on the entered next-home purchase
After-tax wealth
Three paths on the same scale
- Year-one after-tax cash
- −£486/mo
- Gross yield
- 5.3%
- Break-even rent
- £3,265/mo
- Exit CGT
- £30,157
- Year-one after-tax cash
- −£112/mo
- Gross yield
- 6.4%
- Break-even rent
- £1,845/mo
- Exit CGT
- £8,091
The old home changes the next purchase.
£30,000Incremental SDLT, LBTT or LTT under the entered next-home assumptions. This can be refundable in some replacement-main-residence cases if the old home is sold within the statutory window.
Acquisition friction comes first.
£98,500Deposit, £20,000 property-purchase tax and entered buying costs. The tax is modelled at additional-property rates.
Mortgage interest is not deducted in full.
£65,327 / £36,287Cumulative modelled income tax for keep-and-let / BTL after the entered finance-cost tax credit.
Assumption risk
What if property growth is two points different?
| Scenario | Sell & invest | Keep & let | Buy a BTL | Leader |
|---|---|---|---|---|
| Property growth −2 points | £372,203 | £219,058 | £295,096 | Sell and invest |
| Base assumptions | £372,203 | £292,923 | £339,329 | Sell and invest |
| Property growth +2 points | £372,203 | £381,039 | £385,163 | Sell and buy a BTL |
Rental mortgage rates two points higher
Sell and invest leads by £71,685Keep-and-let ends at £259,760 and the purpose-bought BTL at £300,518 in today’s money.Wealth path
Nominal wealth before inflation adjustment
| Year | Sell & invest | Keep & let | Buy a BTL |
|---|---|---|---|
| 0 | £292,500 | £259,000 | £264,500 |
| 5 | £373,312 | £311,113 | £342,958 |
| 10 | £476,452 | £374,966 | £434,369 |
Why the comparison can look different from rental yield.
Gross yield ignores financing, tax, voids, management, maintenance, buying costs and the equity that could have been invested elsewhere. This model carries every after-tax rental surplus—or funding shortfall—into an investment account, then deducts mortgage balances, selling costs and modelled CGT at the end.
Assumptions used
- The three paths begin with the same current property and the same additional cash.
- Positive rental cash flow is invested; a negative balance represents additional cash injections and their foregone investment growth.
- Individual residential landlords receive the entered basic-rate finance-cost tax credit rather than a full mortgage-interest deduction.
- Private Residence Relief is time-apportioned using entered ownership and main-residence years plus the final nine months where eligible.
- The properties are sold at the selected horizon. CGT uses one entered annual exemption and one rate per disposal.
- Fixed property costs rise with inflation; rent and property values follow the separate entered assumptions.
This is a decision model, not a landlord tax return, valuation, mortgage assessment or recommendation. Consent to let, licensing, safety obligations, lease restrictions and lender stress tests can rule out a path even when its modelled wealth is higher.
Sell or rent out your house?
Compare released equity—not just rent against the mortgage.
The correct baseline for keeping a property is what the net sale proceeds could do elsewhere. The lab therefore compares three complete balance sheets rather than presenting gross rental yield as the answer.
Sell and invest
Clear the mortgage and selling costs, estimate any current CGT and compound the remaining capital at your net alternative return.
Keep and let
Retain the existing equity, model after-tax rent and mortgage amortisation, then include the extra property tax that keeping the home can create on the next purchase.
Sell and buy a BTL
Use the same released capital for a separately selected rental property, including its deposit, additional-property tax and acquisition costs.
UK landlord tax
Three tax effects can reverse an apparently attractive yield.
Rental income tax
For an individual residential landlord, mortgage interest is generally excluded from deductible expenses. Relief is instead given through a restricted tax credit. Announced property-income rates for England, Wales and Northern Ireland rise to 22%, 42% and 47% from April 2027, with finance-cost relief at 22%.
Additional-property tax
Keeping the old home can make the next purchase an additional property. England and Northern Ireland generally add five percentage points; Scotland uses an 8% Additional Dwelling Supplement; Wales uses separate higher residential bands.
Capital Gains Tax
A home that was once your main residence may receive time-apportioned Private Residence Relief and the final nine months. A purpose-bought BTL normally does not. The current individual annual exemption is £3,000 and CGT rates are generally 18% or 24%.
Primary sources
Rules used in this property decision model
Common questions
Sell, let or buy-to-let FAQs
Should I sell my house or rent it out?
Compare the after-tax rental cash flow and future sale equity with the return available from investing the net proceeds if you sell. Include voids, management, maintenance, mortgage payments, the restricted finance-cost tax credit, Capital Gains Tax and any extra property-purchase tax caused by retaining the old home. Gross rent versus the mortgage payment is not a complete comparison.
How does this sell or rent out calculator keep the comparison fair?
All three paths begin with the same current property and the same additional cash. Selling releases equity into an investment account. Keeping the home retains that equity in property. The purpose-bought BTL uses the same released capital for its deposit, additional-property tax and buying costs. Rental surpluses are invested and rental shortfalls reduce wealth.
Why does the calculator include the price of my next home?
Keeping an old home can make the next purchase an additional property. The lab calculates the difference between main-home and additional-property SDLT, LBTT or LTT and charges only that incremental amount to the keep-and-let path. Refund conditions and ownership facts must still be checked with the relevant tax authority.
Can an individual landlord deduct mortgage interest from rental income?
For UK residential property, an individual landlord generally cannot deduct mortgage interest when calculating taxable property profit. A tax reduction is instead calculated at the basic property-income rate, subject to statutory limits. The lab uses an editable finance-cost credit rate and does not model carried-forward restricted finance costs.
What property-income tax rates does the lab use?
The default 42% rental-profit rate and 22% finance-cost credit reflect the announced higher and basic property-income rates for England, Wales and Northern Ireland from 6 April 2027. The settings are editable because the applicable rate depends on the landlord's tax position, location and future legislation.
Will I pay Capital Gains Tax after renting out my former home?
Possibly. Private Residence Relief normally covers periods when the property was your only or main home and, where eligible, the final nine months of ownership. The remaining share of the gain can be taxable after allowable costs and the available annual exemption. The lab provides only a simplified time-apportionment estimate.
Does the buy-to-let comparison work for a limited company?
No. It models personally owned residential property. A company can generally deduct finance costs but may pay Corporation Tax and tax when money is extracted, while transaction taxes and mortgage pricing can also differ. Mixing individual and company rules would make the comparison misleading.
What does the break-even rent mean?
It is the approximate monthly asking rent required for the first modelled year to produce zero after-tax cash flow after voids, operating costs, mortgage payments and rental-income tax. It is not a lender interest-coverage test and does not establish whether that rent is achievable.
Does a higher modelled result mean I should become a landlord?
No. The result excludes lender approval, consent to let, licensing, safety compliance, tenant risk, legal work, time, concentration and the personal value of liquidity. It is useful for finding the assumptions and tax costs that drive the decision, not for replacing professional advice or due diligence.
Strengthen the inputs
Check the evidence before trusting the model.
Use local sold prices and £/m² benchmarks for valuation, then calculate the transaction tax and mortgage separately.