Buying and Renting a Home: What's Most Advantageous in Canada?

Buying and Renting a Home: What

By making the right choice, you will save over $700 CAD per month.

Almost all cities in Canada saw rapid increases in housing prices during the pandemic, which continue to this day. Still, it's worth giving serious thought before giving up the dream of owning your own property, because rental prices have also risen. Major real estate operator Royal LePage conducted a study to find out what is more profitable in Canada: buying a home or renting.

"It's important for Canadians to own their own property for many reasons. Not only is it a source of pride, but it's probably the biggest and most meaningful financial investment for most people," shared Karen Jolewski, chief operating officer of Royal LePage Real Estate Services Ltd.

Will Dunning, an economist and real estate analyst, has run 278 purchase and rental scenarios for various types of housing in various Canadian cities using historical data, future projections and looking at homeownership as an investment.

And while the overall cost of owning your own home may be higher than renting it, there is an important factor to consider. Mortgage payments include interest and principal, which Royal LePage suggests should be treated as forced savings.

In 91% of these cases it is more cost-effective to pay for your own home than a rented one. Savings average $769 CAD per month. Buying will be more profitable even if mortgage rates increase (the highest rate since 2014 — 3.62% — was used for the calculations). The 9% of cases in which renting was cheaper than buying relate to luxury homes in expensive neighborhoods.

In addition, many Canadians consider buying a home as an investment. Analysts at Royal LePage calculated the possible options for changes in real estate prices over the next 10 years and concluded that even if the cost decreases by 10%, in half the cases the house will still bring income. If prices remain at the same level, the property will bring a good income, and if they rise — the owner will be even more profitable.


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