I read this great article in Macleans that makes a compelling argument for renting over buying. It’s definitely a contrarian viewpoint given our real estate-obsessed culture – at any given hour of the day you can watch some show on TV devoted to either buying, selling or decorating a house. But with all this economic uncertainty, interest rates will have to go up eventually – and the housing market hasn’t exactly been stable.
However, the big reason to pause before jumping into the real estate market is this – the fees and costs associated with moving once you’re in the market. Last year my husband and I considered moving from our small Toronto row house to a somewhat bigger house up the street. We could just about handle the price jump – we balked at the fees. To make our move, we calculated it would have cost us roughly $45,000 – $50,000 in agent fees, land transfer tax, and legal costs just to get out of our tiny house and into a slightly bigger one. It bit into our down payment and made us realize we’d rather renovate and stay put until the kids were older and we are sure we like the neighbourhood schools.
My advice – if you are thinking of buying, make sure you plan to stay put for at least three to five years. If you’re not sure – then maybe renting is for you.