Canada remains a nation of homeownership. Studies show that Canadians within different age groups aspire towards homeownership. Some say, buying a home is the more affordable option when compared to renting. Despite the rapid rise in home prices, those who are able to invest in a home would end up “significantly better off” in the long term compared to renting. Let’s take a look at this point of view.
The main arguments revolve around these two facts:
First, rents continue to rise over time whereas the largest cost of homeownership, the mortgage payment, is a fixed amount over a set period of time. The result is that the cost of renting will increase more rapidly than the cost of homeownership. Although some provinces have rent controls in place, an annual rent increase and loopholes see rents increase every year.
Secondly, the costs of ownership includes considerable amounts of repayment of the mortgage principal. “When this saving is considered, the ‘net’ or ‘effective’ cost of homeownership is correspondingly reduced. Although your monthly mortgage payment remains the same over the term, your principal repayment portion increases. This savings component over time and the historical increase of real estate is the significant difference.
Barriers to Homeownership
Aspiring homeowners will have to overcome the larger down payment rules and the government’s new Stress Test requirements. These barriers are significant and aspiring homeownership candidates will need to work harder to buy a home. Your home remains the largest asset and at first, the largest liability, on your balance sheet. It is an important lifelong decision.
Let Jennifer Rossides an Ottawa mortgage broker work on your behalf to achieve this. As an accredited mortgage broker in Ottawa I assure you that I can help you reach your dreams. Please give me a call at 613-867-8076 or send Jennifer Rossides an email at email@example.com Start today to find a Smart Mortgage Solution that’s right for you.