Buying vs renting – my thoughts

There have been many articles in the media lately comparing the advantages of renting over buying real estate. While there are many valid reasons to delay buying and continue renting, there are a number of factors to consider if it makes sense for you:


  • You can save by renting but one must be disciplined and it doesn’t work for everyone; lifestyle expectations have to be tempered. Having a mortgage forces that discipline.
  • Today, in the Toronto market most new rental units come from investors who rent out their condos. Remember though, that for buildings built after 1991, rent review does not apply, and the landlords can raise the rent as much as they want, provided proper notice is given. This would be the case for most condo rentals.
  • When renting it is easy to get too complacent and never make the move to home ownership. Expectations are often too high. Start your search in a less trendy area and be prepared to do some work. Give up the latest fads for now, and look for an affordable, structurally sound, home in an up and coming area (yes, Scarborough) and do the tasks you can handle to make it your own.  When I bought my first home I did all the interior painting myself, and left the bigger jobs like roofing to the professionals – after getting 3 quotes and references. Another bonus – the basement generated rental income! Others will follow, but that’s another blog.
  • Home ownership provides two significant financial advantages. First, you benefit from capital appreciation on a tax free basis. Second, you benefit from the leverage (return on investment) provided by the money you borrow as your asset appreciates.

There are many other arguments pro and con; you have to do what’s right for you. If you would like to discuss further, I look forward to hearing from you.








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