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August 03, 2021

Ontario renters feel they're wasting their money: poll

Seven in ten (70%) Ontario renters say that owning a home is in their plan, according to a recent survey from the Ontario Real Estate Association. In fact, 12% say it’s their plan to purchase in the next two years, while others say within the next five years (19%). 

While 78% say that renting is simply the right choice for them at the their current stage in life, most feel  like they're wasting their money by renting.

What's keeping them back? Well, other than not being able to carry a mortgage (54%), not having a large enough down payment (52%), being spooked by potential maintenance costs (26%), not wanting all the responsibility (25%), or being a former home owner (13%), really not all that much.

Do you feel the same way?

There’s no question that buying a house makes sense for a lot of people, particularly when you try weigh the non-financial reasons. You’re not at the mercy of a landlord, you can pretty much do what you want with the place, you don't have to worry about leaky toilets, and you can always sell out if things aren't working to plan.

But does it makes sense financially, given the possibility of rising interest rates and prices? I'd have to say maybe. But Ben Rabidoux, an unapologetic renter, who runs the Economic Analyst blog, regularly delivers an emphatic no.

Not convinced? Here are a few other considerations, courtesy of the Compounding Returns site.

Your job may require you to move with short notice: You don't want to be stuck paying the mortgage on an empty house because you had to move with a moment's notice due to employment.
You don't have a 20% down payment: You are much better off renting a home for the short term while building your down payment then biting off more than you can chew on a mortgage.
You can't afford it: If the house costs more than twice your annual household income, chances are, you can't afford it. Do a sanity check before you buy.
You can't afford the upkeep of a home: If you are buying a home, you better have an ample emergency fund as expenses will always be more than you can anticipate.
Are you grappling with the buy versus rent dilemma? Or are you in the 'dive-right-in' camp?



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Gordon PowersGordon Powers

A long-time fund company executive, Gordon Powers now heads up the Affinity Group, a financial services consulting firm. Gordon was a personal finance columnist for the Globe & Mail for many years, has taught retirement planning...

Jason BucklandJason Buckland

The modern-day MC Hammer of money, Jason can often be seen spending cash that isn’t his with the efficiency of a Wilt Chamberlain first date. After cutting his teeth as a reporter for the Toronto Sun, he joined the MSN Money team with...