Facts to Know When Deciding Whether to Buy or Rent a Home

There's quite a bit of heavy consideration that should be put into determining whether buying a house in Canada versus renting is the right step to take next on life's journey. Many potential buyers approach the subject with the mentality that “it needs to be a solid buyers market” before taking that step. Others just want a change of scenery as they attempt to find a find a dream home amid a surreal environment. Whatever the reason is for considering buying versus renting or renting versus buying, there are pros and cons to each that need to be taken into account before taking the plunge either way.

The Pros and Cons of Renting

Let's face it, not everyone is cut out for the buying lifestyle and there are reasons to rent that abound—depending on the family's budget and long-term goals. While renters may lack creative and decorative freedom amid their abode and have no capital long-term investment, there are still a number of reasons to continue being a tenant.

• Potential buyers can check out a community through renting before committing to buying a home there.
• If continuing education or a blossoming career may require a move soon, renting is a better option.
• Perhaps a job or career change is in the works… this isn't a prime time to buy, as it can impact one's ability to maintain financial accountability.
• Those with negative credit histories can re-establish good credit through timely rental payments.
• There's no maintenance beyond routine cleaning for renters, as owners handle such incidences.
• Inclusive perks for renters may include utilities like garbage, sewer and water.
• Additional costs are limited, as purchasing a home includes the up-front cost of a down payment and closing costs, as well as other expenses.

On the flip side, there's not much room generally for creative freedom if renters want to make changes to the home like painting, hanging things on walls or making flooring changes, etc. There is also the fact that all the money spent on renting doesn't actually ‘gain' renters anything such as home equity to borrow against after making mortgage payments like buyers do.

The Pros and Cons of Home Buying

Everyone needs to live somewhere, but many find a certain level of satisfaction in buying versus renting and the entitlement of ownership. When shopping smart, homes can be a solid investment, yet many experts advise potential buyers to utilize caution if considering the purchase to be a financial building investment. However, every payment is one step closer to ownership, which you can actually borrow against to refinance your home at better rates or make major purchases. Once the mortgage is paid off, the doors are open to use that equity to fund expenses such as a second home or a loved one's education.

Owners can also deduct any mortgage interest and property taxes annually, and owners have complete freedom to design, alter and decorate their home as they choose versus renters with limited creative options. However, another one of these downsides is that in cases where an appliance or major system like heating and cooling fail, fiscal responsibility falls completely on owners.

A secondary situation is where one purchases a home, townhouse or condominium with a homeowner's association that may incur additional fees, and in return they may supply landscaping, garbage, community water and other recreational areas. Depending on locale, those fees may be well worth the extra cost in addition to a mortgage.

Contact a Real Estate Professional for Guidance

There is so much more to consider when trying to weight the scales concerning buying versus renting that it's always a smart move to consult with a local Cochrane real estate industry professional before making any major decisions.