Rent vs. Buy

Most people compare their rent to a mortgage payment, see a similar number, and conclude buying wins. That comparison leaves out most of the cost of owning.

Owning also means property tax, home insurance, maintenance — a common planning figure is 1% of the home's value per year — plus condo fees where they apply. On a $700,000 home those extras can add $900 to $1,200 a month on top of the mortgage.

Renting has an ignored cost too: your down payment is not sitting idle if you keep renting. Invested, it earns something. An honest comparison counts that opportunity cost on the renting side.

Buying carries large one-time costs at both ends. Closing costs on the way in, and roughly 5% in commission plus legal fees on the way out. Together they typically need three to five years of ownership before buying pulls ahead of renting.

Which makes the decisive question not "is the payment affordable" but "how long will I stay?" Under three years, renting usually wins even in a rising market. Beyond five, ownership's advantages compound — you are paying down principal instead of someone else's.

A falling market extends that break-even. CMHC currently expects prices to keep easing through 2026, which is worth reading alongside the waiting math before deciding.

It cannot price stability, and stability is often the real reason people buy. No renovictions, no landlord selling out from under you, no annual increase conversation. Those matter more to some households than any spreadsheet.

It also cannot forecast prices or rents — anyone who claims to is guessing. The figures here use conservative long-run assumptions rather than optimistic ones, so treat the output as a framework for thinking, not a prediction.

Estimates only, O.A.C.