The Pros and Cons of Renting vs. Owning a Home in Canada

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One of your most difficult financial decisions is deciding to rent or buy a home. And for good reason! Choosing between the two can significantly affect your financial health, lifestyle and personal goals.

So, which one’s better? Unfortunately, there’s no clear answer – owning a home isn’t always the better option, and renting is sometimes not easy. Here, we review some major advantages and disadvantages of renting and owning a home. Hopefully, the information will help make your decision about where to live easier.


Let’s start with the biggest differentiator between the two: price.

Although rent can quickly add up over time, it doesn’t come with the large upfront costs that owning a home does. Plus, the landlord is responsible for taxes and other municipal expenses when you rent.

Over the long run, rent typically stays the same for the length of your lease, with minor increases each year. Depending on what province you live in, there may be rent control, so your landlord will only be able to legally increase your rent by a certain percentage each year. dep. In contrast, homeownership costs can continue skyrocketing depending on mortgage rates, home insurance, taxes and maintenance costs.

Historically, monthly rent has typically been cheaper than mortgage payments. However, owning a home for over five years is generally a better deal than renting. Keep in mind that the actual cost of home ownership is approximately 40 per cent higher than the mortgage payment itself.

But in recent times, there has been a large increase in rental prices. In some areas of the country, rent can be as high as mortgage payments.

As for utilities? They’re often included with rent payments, which can help immensely with budgeting. This is unlike homeownership, where utility payments can fluctuate monthly and catch a homeowner by surprise.

Upkeep and Maintenance

Renting has one huge benefit over owning a home: the lack of upkeep. When a problem arises as a renter, there’s usually only one thing you need to do: call your landlord, whose responsibility is to repair (and pay for) the problem.

As a homeowner, handling home maintenance problems is not that easy. In this case, you’re responsible for fixing anything that must be done – from repairing a broken furnace to patching a leaky roof. Budgeting for house maintenance costs can be tricky, especially if you run into unexpected issues.

Whether you can fix the problem yourself or need to hire an expert, the constant upkeep can become a nuisance – not to mention time-consuming and costly. Since so many of these expenses are unexpected, there’s often additional mental stress that goes along with the repairs.


Of course, nobody can predict the future. But for the most part, owning a home is a great long-term investment due to appreciation.

Real estate is one of the safest investments available as long as the housing market remains stable. It also provides some tax benefits, unlike renting. And the more you pay down your mortgage, the more equity accumulates, which you can put towards purchasing another property or completing renovations.

This is the opposite of what happens when you rent. Although you’re making rental payments each month, your landlord is the one who’s building equity in the home. Your hard-earned money goes towards someone else’s mortgage rather than your own.

And unlike owning a home, renting comes with less stability, too. Your landlord can decide to sell the property you’re living in or increase the rent – both situations that may force you into an unplanned move.

But if you ever plan on selling your property, keep in mind that a home is not a liquid asset. The home selling process takes time before a cheque is in hand.

Flexibility and Privacy

Your home, your rules. When you own a home, you can decorate, furnish and renovate the home as you wish and don’t need to ask permission from a landlord. You can also freely own pets without worrying about landlord rules or additional fees. In a rental unit, you must follow many rules and obligations agreed upon in your lease agreement.

Making your home your own often helps you develop a sense of pride in owning a property. You have your own privacy and complete freedom to live your desired life.

Although renting may not allow you similar flexibility regarding making the space your own, it provides much more mobility than home ownership. Feel like living in a different rental (or even a different country)? No problem! Wait until your lease ends or sub-lease your place, then pack your bags.

This type of flexibility is non-existent when you own a home. Even if you go on vacation, you must find someone to look over your place while you’re gone.

If you’re a restless soul, renting’s flexibility is much more appealing. But purchasing a home may be more attractive if you’re ready to commit to a specific place for some time. Just ensure you’re ready for the commitment – breaking your mortgage can result in hefty penalties and costs you want to avoid.

Overall Takeaway

There’s no perfect housing option since both renting and owning a home have their own (very different) advantages and disadvantages.

Ultimately, your financial situation and life goals will help you determine whether renting or owning a home is right.

For further insight on determining whether you can afford to buy a home, request a free consultation for our budget mentoring services.

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