Deciding whether to purchase your first house or condo can be a challenge. On the one hand, it’s natural to feel hesitant about becoming a homeowner due to the commitment involved. On the other, if you’ve been renting for a while, you may be worried that you’re throwing your money away when you should be building equity. It’s no wonder that many potential home buyers are unsure about whether to take the plunge.
If you’re torn between renting or buying a home, it’s important to carefully weigh your options and make an informed decision. Here are some of the most important factors to take into consideration…
Costs
Many people find that renting is more financially convenient in the short term. But is it really less expensive than buying a home? The answer is, it depends. Rents can be cheaper than monthly mortgage payments, but they aren’t always. It depends on the market (it’s worth noting that rent prices are going up in the GTA right now).
Of course, a home purchase is bound to have an impact on your finances—and not just because of the sticker price on your house or condo. From your deposit to a number of assorted closing costs, there are significant expenses involved in the buying process. If you purchase a house instead of a condo, they’ll likely be steeper. Utility bills and ongoing repair and maintenance costs are frequently also higher for single-family homes. Generally speaking, the more space you have, the costlier it will be to heat it, cool it, and keep it in good working order. For unit owners, monthly condo fees will usually pay for the lion’s share of required upkeep (but it’s a good idea to look closely at these when you’re comparison shopping, since they can vary from one building to the next).
Maintenance
The amount of time and effort you put into maintaining your home can have an impact on your quality of life. With that in mind, a low-maintenance lifestyle is one of the biggest benefits of being a renter. While you’re responsible for any major damage you might cause when you’re renting, your apartment isn’t your property. It’s your landlord who’s ultimately obligated to take care of any major issues that arise.
When you buy a house, you’re responsible for all necessary repairs and maintenance. A broken furnace or a roof that’s on its last legs can set you back thousands of dollars. Even small repairs can cause a significant disruption in your life and a dent in your paycheque. For many people, purchasing a condo is a happy medium. Your monthly fees will usually cover the biggest issues that come up, which means you’ll enjoy a low-maintenance lifestyle and the benefits of homeownership.
Freedom
Whether you rent or buy a home, it’s important to think of the future. It’s not just your current lifestyle that matters, but the one you’re hoping to achieve down the line. Are you the type who enjoys being able to pack up and move whenever you want? If so, continuing to rent might be the right decision for you. That said, owning a home comes with its own type of freedom.
Put simply, a home is an investment—one that creates wealth. From a historical perspective, Toronto property appreciation rates are pretty decent. So when you go to sell your house or condo, you’ll likely get a good return—which you can use to travel, buy a new home, and (in general) do what you want to do.
Renovating
Still not sure whether to rent or buy a home? If you have an eye for design—and the desire to create a space that’s truly your own—consider this. When you purchase your living space, you can truly make it your own. If you want to change your layout, install a major appliance, or paint your walls a vibrant colour, you can. You don’t need permission to alter your property. Of course, if you buy a condo, you’ll need to inform management of any major changes you’re planning to make. That said, you can generally expect to have a lot of freedom to perform reasonable renovations.
Needless to say, it’s a different story when you’re renting. Most landlords are fairly restrictive when it comes to aesthetic and structural changes. Luckily, if the renter’s lifestyle is what works for you, there’s no shortage of great units out there—and some of them are bound to align with your preferences.
Whether you should buy or rent a home depends on your lifestyle and your future goals. Fortunately, a great real estate agent can help you explore your options—and give you a good idea of what’s available on the market.
Are you thinking about buying your first condo in Etobicoke? We can walk you through the process to help you make a more informed decision. Get in touch to discuss your needs today!
