Homes: Buying or Renting Which is Wiser?
Industry Canada offers the following useful tips,and a FREE smart investment calculator which can help you decide whether buying or renting a home is a better deal for you.
While there are many advantages to buying a home, such as the ability to accumulate an asset that may increase in value over time, security of tenure, and the ability to renovate or change your home to meet your needs; it’s important to be sure you can afford to make the move from renting to home ownership.
Using the Rent or Buy a Home Calculator
Using the Rent or Buy a Home Calculator is easy! Just input the following figures:
- Funds Available -Your savings for a down payment and closing costs.
- Current Rent - the amount you can afford for housing costs, including utilities,each month.
- Interest Rate
Click 'Submit' and the price of a home you might ba able to afford,will be calculated.
The Smart Investment calculator only estimates the cost of closing and monthly utilities. Actual costs may differ. If you are considering buying an existing home, ask the realtor, lawyer or banker for the utility bills for the last year or so, if they are not provided with the listing. This can give you a more accurate idea at what the utility costs may be.
Additional Home Ownership Expenses
- Buying a home for the first time, may entail many other expenses such as purchasing appliances, gardening equipment and additional furniture, etc.
- If purchasing a newly built home, you may also have additional expenses such as fencing and landscaping.
- Consider costs of repairs or renovations when buying a home. This is one reason it is always important to have a home inspection done on the house you are planning to buy. It can give you a good idea of the costs that lie ahead in the early years of ownership, like a furnace, windows or a roof that may need to be replaced.
- Thinking of buying a condominium? Be sure you budget for any condominium fees.
- While the housing market in Canada has been very robust and house prices have been increasing in most regions, it’s important to understand there is no guarantee that the housing market will remain the same over the long term.
For more information see the housing section of the Canadian Consumer Handbook.
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