It’s no secret that the cost of living continues to rise across the globe — and especially in Canada.
In Canada, the average price of gas per litre hit $1.78 during the week of March 13 of this year, as reported by the Canadian Automobile Association. In January of this year, the annual inflation rate rose to 5.1% for the first time in over three decades while the wage increased only 2.4% over the same period. Canadians are feeling the financial pressure. In a survey conducted by Angus Reid, 53% of respondents admitted that “they can’t keep up” with the rising cost of living. Included in rising costs is the price of buying and renting a home. So, when it comes to living, is it better to own or rent a home? It depends on what type of lifestyle you lead. Before making a decision, consider some factors to figure out which type of home works best for you. General Points to Consider There are a few things to consider before deciding if it’s in your best interest to buy or rent. First, think about where you want to live. This can depend on your family, work or personal preference. If you’re looking to live closer to a big city, like Toronto, you’ll likely look for a home to rent — unless you can afford the skyrocketing prices for buying a house or condo. On the other hand, if you have a family and don’t mind living a little outside the city centres, buying a home may be a better fit. The next step is figuring out how long you plan to stay in your new home. People who like to move around a lot might want to rent, since it’s both easier to pack-up and leave and you won’t be stuck making mortgage payments. The opposite goes for those looking for stability. Purchasing a home allows people to settle in one area. Finally, create a budget and decide how much you want to spend. Considering the other factors, if you can afford to make monthly rent payments and will move out within a short period of time, then renting might be the way to go. If you’re looking to stay in a home and want to increase the value of your home to your advantage, then purchasing is a better fit. Renting There are pros and cons to both renting and buying. It’s important to do research, but there are some key things to consider before making a final decision. The life of a renter may look a little different than that of a buyer. People who rent are able to move around much easier. You aren’t trapped in mortgage payments and interest, it’s easier to pack all your belongings and move, the overall payments are likely lower, and you don’t have to worry about maintenance responsibilities (though you might have to pay for them). The cons are just as important. As a renter, if you decide to move, you don’t gain anything back, like a homeowner who resells. Also, the price of your rent can fluctuate. There are often restrictions set by the landlords on renovating, and on the type of lifestyle they’re comfortable with on their property. Buying Buying a home has a similar amount of pros and cons. Unlike renting, buying a home gives you full control over renovations and changes you want to make to the home (make sure to check in if you have an Homeowners Association, and take a look at city laws). If you decide you move and the price of your home has gone up since the time of purchase, you may gain some money back. Often, the monthly mortgage payments are more stable, depending on the contract you sign. On the other hand, buying a home makes it harder to move, not only because of the amount of stuff but the paperwork that needs to be completed and the selling of the home before you move into the next. You’re also responsible for all maintenance to be done on your home and property, having to pay completely out of pocket for them. Buying is not always better than renting in some scenarios. It’s important to make that distinction to decide what’s best for you in the long-term. Comments are closed.
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AuthorLarry Weltman is a Customer Service Representative for AccessEasyFunds Limited, or AEF, an Ontario-based firm Archives
November 2022
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