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Remember when owning a house was the big thing? Is it now better to rent? Should you rent or buy a house?
One of the big dreams for many of us was to buy a house of our own. That’s all we wanted, and we all had dreams of the type of house that we had.
Other Millennials out there will know that the idea of buying a house is now a pipedream. However, you may still have that dream, and you may be on your way to it. Maybe you have the downpayment, and now you’re just waiting for the right place in your area. Maybe you have the mortgage preapproval and you need the market to loosen up a little.
As much as I would love to own a house, it’s not one of my big goals yet. Instead, I’m quite happy renting and I have no big aspirations to buy, especially not in this market.
Should you rent or buy a house?
Why wouldn’t I buy right now? It’s all to do with the interest rates. I know that’s causing a problem for a lot of people. Those who are renewing their mortgages are seeing their monthly payments double and more. Why would I want to put myself in that situation right now?
The housing prices are also causing a problem. The houses that used to cost $400,000 around me just before the pandemic now cost more than a million. That’s a crazy price increase, and it’s all because people moved out of Toronto during the pandemic and inflated the housing market. Well, not all, but that’s a big reason.
When I looked at the mortgage that I’d be able to get, I realized that the monthly payments were more than my rent. And not just by a little. They are at least $1,000 more per month. Some of them are much more than that. Not only can I not afford that, but why would I want to pay that?
If you look at whether you should rent or buy a house, you need to consider other costs when it comes to owning and renting. If you own, you have all that maintenance that you need to do yourself and you need to pay the property taxes. Where I am, the maintenance on the place, the snow shoveling and lawn care, and the property taxes are all included in my rental price—and my rent can only go up by a set percentage thanks to being in a rent-controlled place.
There are times that I would pay a little more to own rather than rent. I’m talking a few hundred dollars more. I want the freedom and stability, and I’ll factor in the other costs. However, for the extra cost of a mortgage, I’ll stay in the rental market and just keep saving some money.
And this is just looking at things from a financial point of view. I have other reasons I love renting, but that comes from my nomad style of living.
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