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Rent vs Buy

Rent Vs. Buy

Renting Or Buying: How Do You Determine What’s Right For You?

There’s a social pressure in western culture to become a homeowner. As kids, we live with this expectation that we’ll “grow up” and buy a home of our own one day.

While owning your own home can provide security, improve quality of life, and offer a solid financial investment, it’s certainly not your only choice. It may come as a surprise to hear this from your mortgage broker, but…

Owning a home isn’t for everyone.

In some cases, it might make more financial sense to rent.

There are a multitude of variables that come into play when you’re making the decision to purchase. The real estate market is an obvious one, but your personal situation is equally imperative.

This is why we always consider the bigger picture when meeting with clients to discuss their mortgage options. It’s important to know your goals – both personally and financially – so you feel equipped to make the best decision moving forward.

 

Reasons to Continue Renting

Just as there are some compelling reasons to become a home-owner, there are also plenty of good reasons to continue renting:

  • Renting represents mobility. Want the freedom to satisfy your nomadic lifestyle? Renting may be best for you.
  • You’ll have fewer responsibilities. No need to fret about the water heater breaking, or replacing shingles damaged by raccoons.
  • You’ll have more financial flexibility. You don’t need to worry about selling in order to access cash.
  • You don’t need to worry about expensive renovations or interior decorating. You’re less likely to spend your money on sprucing up your rental unit.
  • It’s easier to come up with first and last month’s rent than a down payment on a home.
  • You won’t have to worry about the market dictating the value of your property.

Advantages of Home Ownership

If you are considering making the transition from renting to buying, here are some of the benefits home-ownership can bring:

  • Your home can offer financial security. A home can be one of the greatest investments you’ll make, bringing the opportunity to safeguard your financial future.
  • Your home can be an effective tax shelter. It’s an asset that won’t incur capital gains tax.
  • You can renovate or decorate however you choose.
  • You could earn money by renting out extra space.
  • Your home equity can be used to finance another investment.

Are You Ready to Buy?

How do you know if or when you’re ready to commit to a mortgage?

First, you want to consider the fees, taxes and monthly payments. How much can you really afford? Remember to consider closing fees (like land transfer tax) and additional ongoing bills when you’re calculating the total cost of home ownership.

If you’re not sure just how far your budget can stretch, connect with us and we’ll get you started.

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