METHODOLOGY

How Homabu's numbers are calculated

Every figure on this site comes from a specific, documented method. This page explains each one — the data behind it, the assumptions it makes, and where it can go wrong — so you can judge how much weight to put on it.

Last updated: August 2026
On this page
1. The affordability calculator 2. Service charge estimates 3. Rent vs buy comparison 4. Local authority & regional house price data 5. Long-term trend & projection 6. General limitations

1. The affordability calculator

Simplified & Precise modes

The calculator estimates a maximum purchase price from your income, deposit, and (in Precise mode) property type. It is not a mortgage offer or an assessment of your actual creditworthiness — only a whole-of-market broker or lender can tell you that.

Mortgage tiers

Three income-multiple tiers are shown: Standard (4.0–4.5x), Enhanced (5.5x, based on FTB-focused products like Skipton's range), and FTB Boost (up to 6x, based on products like Nationwide's Helping Hand). These reflect publicly reported lender criteria as of early 2026 and change over time — always confirm current criteria with a broker.

Property type restrictions

Short leases, ex-local-authority flats, new-builds, non-standard construction, and flats above commercial premises can all reduce which tiers, or which lenders, are realistically available. Where this applies, the calculator falls back to the Standard tier and flags why, rather than showing an optimistic figure a lender is unlikely to actually offer.

Mortgage term

Simplified mode assumes a 30-year term — this matches the average term now taken by UK first-time buyers (up from a traditional 25-year baseline). Precise mode lets you choose 10–40 years. Monthly repayment is calculated with the standard repayment-mortgage formula at a representative interest rate, amortising the loan evenly across the chosen term.

Comfort buffer

An optional percentage reduction applied to the maximum price, to leave room for costs that a Mortgage in Principle doesn't fully account for. This is a judgement call, not a data-driven figure — you can set it to 0% if you'd rather see the unbuffered maximum.

2. Service charge estimates

Precise mode

There is no live, public, UK-wide database of service charges by individual property — no calculator, including this one, can look up the real figure for a specific flat. What Precise mode offers instead is a modelled estimate, built from published market averages, that you can override at any time with a real figure.

The estimate starts from published bedroom-banded averages for UK leasehold flats, then adjusts for property type — new-builds with concierge and shared amenities typically run well above older, simpler blocks such as ex-local-authority conversions. The displayed range is deliberately wide, to signal a starting point rather than a quote. When the estimated service charge crosses thresholds some lenders use to flag a property, the calculator adds a lending note — a small number of lenders decline flats above certain service-charge-to-value ratios, independent of the buyer's own affordability.

Known limitation This model cannot see the actual building — its age, amenities, management quality, or reserve fund. Two flats of identical size and type can have very different real charges. Always get the actual figure from the listing or seller before offering.
Sources: Hamptons Service Charge Report 2025; The Property Institute Service Charge Index 2026; Direct Line for Business.

3. Rent vs buy comparison

Below the calculator result

This compares your projected net worth under buying versus renting, year by year, for up to 25 years. It is a simplified model for exploring a trade-off, not financial advice or a prediction — see the disclaimer shown alongside the tool itself.

The core method: net worth, not just cash spent

Both paths start with the same pool of cash (your deposit plus buying costs). The buyer puts theirs into the property; the renter keeps theirs invested. Each year, the calculator compares the actual cash cost of each option — mortgage payment plus maintenance plus service charge for buying, versus rent for renting — and whichever option costs less that year, the difference is treated as invested at your chosen return rate. This mirrors how established tools like the New York Times' rent-vs-buy calculator handle it, and it matters: in the early years of a mortgage, buying is often the more expensive option month to month once maintenance and service charges are included, which means a renter in that position has real money to invest, not none.

Why buying often doesn't lead in year 1

Mortgage interest is heavily front-loaded in the early years of a repayment mortgage — a large share of your first year's payment is interest, not equity. Combined with stamp duty and legal fees paid upfront, and a renter's deposit sitting fully invested from day one, renting frequently comes out ahead in years 1–2, even in a rising market. This is a real, correctly-modelled effect — not a bug — and it's exactly why the tool shows a year-by-year breakeven rather than a single verdict.

What's included

What's not included

Not financial advice This tool shows how the trade-off moves under different assumptions. It does not, and cannot, tell you whether buying or waiting is the right decision for your specific circumstances. Speak to a qualified, regulated financial adviser before making a decision based on this.

4. Local authority & regional house price data

Data page

Current prices, and all historical figures, come from the ONS/HM Land Registry UK House Price Index — the official government house price statistic, published monthly under the Open Government Licence v3.0.

Boundaries shown on the local authority map are from the ONS Open Geography Portal (Local Authority Districts, May 2023).

5. Long-term trend & projection

Data page — "long-term trend" and the dashed line on the chart

The "long-term trend" figure, and the dashed projection line on the growth chart, are calculated using a log-linear regression — a standard statistical method that fits a single average annual growth rate across all 20 years of monthly data for an area, rather than just comparing the first and last point.

Why this method, specifically

A regression uses every data point, so one unusually high or low month can't distort the result the way a simple two-point calculation (just comparing year 1 and year 20) can. Fitting the trend in log space means the resulting growth rate compounds correctly — a straight percentage-per-year figure, the same way you'd read "average annual growth."

The trend is deliberately withheld where it doesn't fit

Every regression produces a measure of how well the straight line actually describes what happened. For a subset of areas — some concentrated in Northern Ireland (which saw an exceptionally sharp 2007–2013 crash and slow recovery), plus a few areas like Aberdeen (oil-price-linked) — the underlying price history is genuinely uneven, and a single "X% per year" figure would misrepresent it. For these, the trend line and forward projection are not shown. The underlying 5/10/20-year change figures remain accurate and shown regardless, for every area.

The projection is not a forecast

Where shown, the dashed line on the growth chart simply continues the historical average growth rate forward. It assumes the past repeats, which it will not — property markets are cyclical, and past growth is not a reliable predictor of future growth over any specific period. We use the term "trend projection" deliberately, never "forecast" or "prediction," and this page exists partly to make that distinction concrete rather than just a disclaimer.

Refresh cycle This dataset is refreshed periodically from the same ONS/HM Land Registry source. Check the "as of" date shown on the Data page for the most recent update.

6. General limitations

A few things worth understanding about every calculator on this site, not just one section:

If you spot something on this page that looks wrong, or a calculation that doesn't match what you'd expect, we'd genuinely like to know — get in touch via the details on our About page.