Renting vs Buying a House – The Great Debate
Paying rent is often the first step for someone after they leave their parents’ home. Whether it’s in a university dorm or a room in a house full of friends, most of us get our feet wet in the real world by paying somebody else for a place to live. And there’s absolutely nothing wrong with that.
In fact, renting is a good way for people to live within their means, should they find a suitable place for the right price. Although it’s true you are paying, or helping to pay, somebody else’s mortgage, too many times people see this as the sole reason to buy their own home and become house poor in the process because there’s more to home ownership than mortgage payments. By renting within your budget you avoid the ‘hidden expenses’ that come with home ownership, like higher refinancing mortgage rates, property taxes, and on-going upgrades and repairs.
In some cities in Canada, renting is about the only option for people because of high housing prices in urban areas and their ever-expanding suburbs. But renting does have its pitfalls. The saying is 100% true – you are paying someone else’s mortgage by renting their house or apartment. You also don’t build a credit rating by renting, nor do you have any say in the actions of your landlord/property owner, who could literally sell the house out from under you, leaving you in a tight spot and possibly in search of a place to live in a housing market that has skyrocketed since you were last on the market, throwing your budget for a loop. If you are secure financially and have a higher standard of living than your average college student, you may want to explore home ownership, because there’s a chance you’re paying the same in rent as you would for a decent home in your neighbourhood.
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