this at some point as they form their goals and plan for the years ahead. Before you answer the question, here are some things to ask yourself. Owning and renting each have advantages, but what’s best for you depends on your circumstances.
What will be the duration of your stay at home?
Each market is different, but whether the time you plan to spend in the house warrants its purchase is possible to predict. Generally, it takes almost 5 years to break even on a home (i.e., where there has been enough appreciation to pay back the cost of the transaction and ownership). If you’re considering buying and selling a home in two years, buying is very unlikely to be cheaper than renting. Do you consider your house an investment in your retirement plan? Canadians are accustomed to their homes serving as a store of wealth to liquidate in retirement when downsizing their lifestyle. According to Jacob Passy, a recent study by the Federal Reserve Bank of New York examined consumer preferences for homeownership and how their perceptions have changed during the COVID-19 pandemic. Survey participants were asked to rate the better investment: a home or stocks. The results showed that over 90% of the respondents preferred owning their residence over investing in the stock market. Most survey participants also favored being a landlord over buying stocks, with more than 50% of the participating households preferring to own a rental property.
Are you financially ready?
Owning a home is a significant financial commitment that requires planning how home ownership fits into your life's direction. Consider your budget and whether buying or renting
14
Powered by FlippingBook