Buying Vs. Renting

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Buying Vs. Renting

These days, I know a lot of people who are “cashing out” of their homes and plan on waiting the market out by renting for a while. No one can predict the future. Only time will tell if this was a smart move. I know people who “cashed out” four years ago thinking the market was going to crash. Not only have they spent tens of thousands of dollars paying someone else’s mortgage, they have missed out on the equity increase of their home since. One of these days, they may be right, but if the brightest economists in this country can’t say when, I’m not even going to try.


When it comes to a home, you have two options: buy or rent. What is right for one person may not be right for another, which is why it’s important to know which is the better option for your individual situation.


There are a number of reasons why someone may choose to rent, including sporadic or unpredictable income, a high debt-to-income ratio, frequent relocating for employment or the challenge to save enough money for a required down payment on the purchase of a home. Or simply for peace of mind of not having to be responsible for the maintenance of a home.


This is a big consideration when choosing whether to rent or buy. When you rent, the property owner is responsible for repairs and these issues can sometimes be very costly. The downside is that you are, more or less, at the mercy of the owner if he or she decides to sell or have a family member move into the unit.


If you have steady income with a good employment history, can provide a down payment of at least 5-10 percent of the purchase price and are current with all debts, it may be time to consider buying a home instead of renting. In some cases, the cost of rent may even exceed that of a typical mortgage payment, especially at today’s low interest rates. Of course, these can change over time, so make sure that you don’t “over-buy” and you can financially handle some fluctuation in the cost of ownership.


Ideally, you should plan to be in your first home for at least 5 years in order to accumulate enough equity to use as a down payment on another home when it’s time to look at that move-up property.


If you can answer yes to the following questions, you may be ready for home ownership.


  • Have you been steadily employed for at least one year, but preferably two years? Job stability will impact your ability to get a good mortgage.
  • Do you plan to live in the home long enough to build equity? Don’t over-buy but buy something you can “grow” into for a few years. Moving can be expensive and chip away at your profits.
  • Can you provide a down payment and still have enough money left to pay for closing costs, utilities and home furnishings?


I’m always ready to help you to find the perfect home based on your individual needs. You may have other questions that are unique to your situation. Don’t hesitate to reach out. I’m here to help!



I specialize in residential real estate in Oakville, Burlington, Milton and Mississauga. My goal is to provide you with an exceptional level of service that will ease you into your next home, through every stage of life. If you, or anyone you know, are considering a move and would like to receive listings, let me know and I can get you started. I am never too busy for you or any of your referrals.

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