Should I Buy or Rent a Home? Looking at the Options

For many Canadians, renting is a stepping stone to homeownership but not everyone who rents is looking to take that step. Some people are quite content renting for as long as they can—it actually has some pretty significant benefits. But then again, so does buying. So, what’s right for you? We talked to homeowners, people who’ve chosen to rent,  and REALTORS® to get a better idea of what each option can offer.

Being a renter: the upsides

Predictable budget

For many, especially when utilities are included, being a renter means a predictable monthly budget and that consistency is enticing. 

“Paying rent, you know what your expenses will be every month,” says Victoria Bomben, REALTOR® and sales representative with Property.ca Brokerage in Mississauga, Ontario. “You don’t have to worry about market ups and downs or interest rates, which are huge stressors for homeowners with variable rate mortgages right now.” 

Your landlord does the work

Toilet not flushing? Call the landlord. Need a new furnace? Ditto. While a homeowner would have to address these issues (and costs) on their own, a renter has less responsibility when it comes to maintenance. Diana, a renter in Toronto’s Yorkville neighbourhood, says she prefers “to rent so I can have someone else take care of my home.”

Smaller financial commitment

While rental costs have been on the rise across the country, renting can still be a more affordable option than owning. 

“I rent because I don’t want to be house poor,” says Toronto massage therapist Joanne Baker. “That much debt is scary because I’m self-employed and my income is random.”

It can be less risky

Typically, what goes up must come down. For Lindsey Bredin, who moved to Canada from Ireland, the unpredictability in the market is why she chooses to rent instead of own.  

“I don’t trust markets when prices skyrocket,” she explains. “I was in Europe during the global financial crisis and lived through the housing collapse. When it crashed, I was relieved I hadn’t invested.” 

It’s way more flexible

Want to move? Give your landlord a couple of months’ notice and you’re good to go. When you own, says Bomben, it’s not as easy to liquidate, so making a move can be more complicated. 

That flexibility can make it easier to explore different neighbourhoods—or provinces—if you’re a bit of an adventurer.

Being a renter: the downsides

You’re paying someone else

Just because you don’t own a property, doesn’t mean no one does. When you rent, you aren’t benefitting from appreciation and equity to build your savings, or to borrow money. Of course, there are always other ways to save. 

You have less control

Your options for personalizing your space can be minimal, so, if you don’t love the place as-is, there may not be much you can do, besides painting or adding a gallery wall.

If the landlord you’re renting from decides to sell, you may have to find a new place. Even though you have rights as a tenant, and may be able to stay until the end of your lease, it does mean you’ll need to start looking soon. 

Buying: the benefits 

Equity and appreciation are huge advantages

Most properties grow in value over time, and those mortgage payments? They’re all going right back into your pocket—at least the principal portion. Myron Kowaliw and his wife bought their first home in 2000 for $180,000.

“It doesn’t sound like much now, but it felt astounding at the time,” he says. “It tripled in value in just a few years. We bought a bigger place, which has also appreciated. It was a very good investment: lately, real estate has performed better than my RRSP portfolio.” 

Ownership offers stability

Maia Thomas is a long-time renter who just bought her first home in Montreal, Quebec. 

“I was always on the fence about buying,” she says. “I liked the flexibility of renting—if I wanted to move, I could. But that shifted once I had kids: owning gives me a sense of security. And I’m fortunate that Montreal prices are still relatively accessible.”

Buying: the considerations

The costs of homeownership add up

There’s the down payment, closing costs, mortgage payments, property taxes, utilities, maintenance fees, repairs, insurance, etc. If the roof needs replacing or the fridge dies, you pay for that. Homeownership requires some savings as a safety net, which can be difficult for those with other major responsibilities, or those early in their careers. 

It’s harder to change your course

Unlike rentals, where there are very few barriers between you saying “see ya” and being on your merry way, selling is more complicated. You could potentially end up spending more than you’ve accumulated, and lose money if a sale isn’t timed right. While some love the idea of a forever home, others may find being tied down to one place a little restricting.

So…is it better to buy or rent? 

It completely depends on your finances, your preferences, and your plans for the future. But, you don’t need to decide on your own. Talk to a REALTOR®—they’ll be able to help you identify the right choice for you, right now. Whether you’re buying or renting, they’ll do the legwork to help you find listings, can help you understand what to expect from a landlord, what you do and don’t need to provide, and ensure you’re set up for success. Plus, they have networks of other agents to tap into, and many have investor clients who are looking for tenants! 

At the end of the day, your decision to rent or buy is up to you, but with the help of a REALTOR®, it can be much less stressful. 

The information discussed in this article should not be taken as financial or legal advice. This article is for informational purposes only.

-Credits: Realtor.ca (08/11/2023) Tamara George Buying a Home or Choosing to Rent: Looking at the Options