Is it Better to Buy or Rent?
Home Buyer Resources|
Real estate in West Toronto has witnessed some tremendous change over the past couple of years. With a new range of economic and social factors influencing housing across the city, today’s buyers are facing a unique set of circumstances.
However, after a few years of a real estate whirlwind, some buyers aren’t sure whether now is a good time to enter the market or if it’s better to simply keep renting until things change.
If you’re in this group – keep reading. In this post, we will take a refreshed look at housing in West Toronto and highlight some smart opportunities for buyers who are ready to break the cycle of renting.
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What Really Happens When You Rent
As a renter, you’re essentially paying your landlord’s mortgage for them. When you decide to move out or they sell the property, you see none of the equity that you helped to build up.
On the other hand, when you buy a home your monthly mortgage payments become part of your investment. As you pay it off, you’re holding onto a highly valuable (and appreciating) asset. Then when you finally decide to sell the home, you will actually see a return on your investment.
Sure, the cost of a home in West Toronto can be substantial, but renting is also expensive. In fact, with fewer home buyers in the market, rental rates have been climbing rapidly. In less than a year, the average cost of rent in the city has grown exponentially. And, as the local population also blooms there’s very little chance that rents will drop.
With this in mind, it’s better to start building equity for yourself as soon as possible.
Looking to break into West Toronto’s unique housing market? Explore these blog posts for helpful advice.
- Financial Incentives First-Time Buyers Should Know About
- 3 Reasons Real Estate Transactions Fall Through
- How to Maximize Your First Home Without Going Over Budget
As a home buyer, your mortgage will make up the bulk of your recurring costs. Where mortgages primarily differ from monthly rental payments the added costs of interest.
In a purchase as substantial as a home, the accumulated costs of interest can make a big difference long term. If you choose a variable-rate mortgage, your incurred costs of interest will fluctuate throughout the term of your loan. This means that your total monthly payment could increase (or decrease) as you pay off your home.
While interest rates can fluctuate, it’s important to recognize that rental rates aren’t always static either. Under Ontario law, landlords can legally increase your rent by a predetermined amount every year.
If you’re unsure how much you can reasonably afford to pay towards a mortgage every month (including interest) we have tools that can help you estimate. Click here to use our Mortgage Affordability Calculator.
How to Make Your Purchase Easier
As real estate agents ourselves, we’ll be the first to admit that buying a home isn’t exactly a small process. That being said, it’s well worth the effort and there are a number of steps you can take to make the process easier for yourself.
Incentives & Tax Breaks
While purchasing a home in West Toronto does make a fantastic long-term investment, the upfront costs can be fairly high. However, the Canadian government does offer some incentives and rebates to help reduce the financial stresses of buying. These assistance programs can help you save a sizable amount of money, especially if you’re a first-time buyer.
Work With a Full Service Team
If you’re searching for a perfect home that suits both your needs and budget, the best place to start is with an experienced real estate agent. In West Toronto, we haven’t seen market conditions like today’s in a long time. If you want to maximize your opportunities for success, you’ll want a professional who has actually worked in similar circumstances – like the Smith Proulx Team.
For more than three decades we’ve helped first-time buyers break the cycle of renting and start building equity for themselves. With thousands of transactions under our belt, we have the industry connections, know-how, and local expertise to help you make a successful investment.
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