Renting vs buying

Is homeownership for you? You need to look at much more than the cost of rent or a mortgageMortgage A loan that you get to pay for a home or other property. Often the loan is for 20 years or more. You make a set number of payments for a set amount each year.+ read full definition payment to know for sure.

A quick comparison

​Renting ​Buying
​Costs ​Likely lower monthly costs

Fixed monthly costs

Pay a deposit of a month’s rent

May pay a deposit for damages

​Likely higher monthly costs with mortgage, property taxes, utilities, maintenance, furnishing and decorating

Pay interest to the bank on mortgage

Possible unexpected repair costs

​Investment potential ​Rent money goes to your landlord ​Build equity as you pay off mortgage
​Income potential ​May be able to create income by renting out rooms or subletting ​Can create income by renting out or borrowing against your home
Maintenance ​Not responsible for maintenance, but dependent on landlord to make timely repairs Responsible for maintenance and repairs
​​Commute ​Higher rents in prime areas but you save time and money on commute ​Affordable houses in suburban areas mean you spend more time and money on commute
​Flexibility to move ​Can move out almost whenever you want ​Harder to move quickly as can take time to sell

May face a mortgage penalty

4 questions to ask yourself

  1. What kind of housing are you looking for?
  2. How much can you afford?
  3. How soon do you think you’ll move again?
  4. How important is home ownership for you?
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