Renting vs Buying: Which is the Right Choice for You?

Dated: June 2 2021

Views: 45

Deciding whether to rent or buy is complicated.

There are a lot of factors to consider – and a lot of opinions to listen to.

In Canada, there is a strong inclination to buy a home rather than rent. In fact, Canada has one of the highest rates of homeownership in the world. A survey in 2016 found that almost 70% of Canadians owned their own home. (Of course, this means that the demand for housing outpaces the available supply, making it much harder to find an affordable home.)

But, even if home ownership is more desirable, that does not necessarily make it the right choice for you at this stage in your life. There are many people for whom renting is the ideal situation.

In this blog, we will talk about the pros and cons of both renting and buying a home to help you consider which option is best for you.


Renting is often seen as worse than buying a home because renters don’t build any equity. Although you pay a monthly rent to live in your home or apartment, you don’t get any return from it. The residence is not yours, and never will be, no matter how long you stay. Your housing costs go towards helping your landlord to pay his/her mortgage on the property.

But renting is a great option for short-term living. If you are at a stage in life where things are still uncertain – you don’t have a stable job, you’re not ready to put down roots, etc. – then purchasing a house is not the best option.

Renting is flexible. You can sign a lease agreement for various lengths of time, or rent on a month-to-month basis, meaning you can move when you want or need to.

The monthly cost of rent is also generally cheaper than mortgage payments. Plus, it may include additional costs like utilities, hydro, and internet. This also makes your housing costs more stable and predictable, as there will never be additional unforeseen costs. The only time that could really change is if your landlord negotiates a new leasing price at the end of your agreement.

When you rent, maintenance and the associated cost is another thing you don’t have to worry about. Whether you have plumbing issues or the furnace needs to be replaced, you can leave all of those home repairs to your landlord to take care of. The only downside is that their timeline for getting it done might not be the same as yours.

With all of the money that you save on housing costs when you rent, you can invest that money into other things. Put it into an RRSP, go on a vacation, or save up for when you want to buy a home.

In summary, here are the pros and cons of renting:

  • Flexible
  • Generally cheaper
  • Predictable costs
  • No maintenance costs
  • Less time spent looking after property
  • More money left over
  • Not building equity
  • Don't own your residence
  • Landlord is in charge
  • Rent rate could change


Buying a home, rather than renting, allows you to settle down and create your own home. There is a greater sense of belonging and community when you own a permanent residence. And you have the ability to make your home and lifestyle fit your personal vision.

This is, of course, a bigger time commitment. When you own a home, upkeep and repairs become a part of your responsibility. Caring for a larger property takes a lot of time and money.

Owning a home costs more overall than renting. Even if your monthly mortgage payments are cheaper than rent, there are other costs to factor in such as property taxes, repairs and maintenance, and homeowner’s insurance.

The benefit is that, if you stay in the home for more than 5 years, the cost will be worth it. Slowly but surely, you will build equity as your mortgage is paid off and you own more of your house. 

Then, whenever you decide to sell, you will be able to make back the costs. This is because homes often continue to increase in value (although a sudden change in the market could see the price drop).

However, with all of the money you invest into your house, you will have less cash left over for other expenses.

In summary, here are the pros and cons of buying:

  • Building equity
  • Belonging and community
  • Your home is your own
  • Property usually increases with value
  • No landlord
  • Long-term commitment
  • Greater cost
  • Responsible for maintenance and repairs
  • Less money left over

Should you rent or buy?

Deciding whether to rent or buy comes down to a couple of things: your current financial situation, your current lifestyle, and your goals for the near future.

In order to buy a home, you first need a stable job situation. If your life is in flux, or you are in a period of transition, it could be hard to get a mortgage. You need to be able to prove that you have had a stable income for two years before a lender will give you the money to buy a house. Besides, if your job situation is still changing, then you may want the flexibility of being able to move somewhere for work in a year or two.

Next, you need to know that you will be able to afford homeownership. Compare rent to mortgage rates in your area to see if owning a house will be affordable. In certain areas where the housing market is hot, it costs far more to own than to rent.

Purchasing a home also requires a down payment. Make sure that you have enough money set aside to cover this cost before you decide to buy. A down payment is often 5-20% of the purchase price of the property.

Even if you can afford a home, stop and think about whether that kind of commitment makes sense for you at this stage. Are you planning to stay in that area for a long time? Are you looking to settle down, or might you want the flexibility to change your plans in a few years?

Lastly, think about what you want to invest your money in. Is a home your top priority right now? Or would you prefer to save money for retirement or invest in a different kind of lifestyle down the road?

Ultimately, the choice to buy or rent comes down to where and how you see yourself living in a few years, and whether the cost of buying is something you are prepared to take on.

Blog author image

Paul Schnittker

Almonte has been my home for many years, and I love living and working in this community. I moved from sales to Real Estate in 2016 because I wanted to help others find their dream home here in the Ot....

Latest Blog Posts

A Look at the Canadian Real Estate Market in May 2021

Might things finally be returning to normal?As the weather continues to improve and more people receive their COVID-19 vaccinations, it seems that people are getting excited for the possibility of a

Read More

How to Find a Good Moving Company

We’ve all heard nightmare stories about bad moving companies. Items go missing or get broken in transport, possessions are held hostage, or the experience just feels very sketchy.The last

Read More

Renting vs Buying: Which is the Right Choice for You?

Deciding whether to rent or buy is complicated.There are a lot of factors to consider – and a lot of opinions to listen to.In Canada, there is a strong inclination to buy a home rather than

Read More

Your Top 5 Home Selling Questions, Answered

Home selling is not something you have to do very frequently.Unless you buy and flip properties for a living, that is.Most homeowners will have gone through the process of selling their home no more

Read More