After the tax break I get on my condo, which is my second property so I was a bit confused about the statement you have to sell your home before you get another one. I think that was aimed at people focusing singularly on 1 place to live. Choosing a good, desirable market is huge, not buying when the housing market is booming etc. When the market for housing goes down, rent goes up, rent around here is astronomical. Granted you have a LOT of up front costs for a home, but I put 20% down on this one (I will live in this one). I get about 70-80.00 a month above what my first place costs me in rent a month. Not big, but still get the tax write off so its more than that, however really I only care if I break even. What it costs me to pay my mortgage is no more than what I’d pay for rent in an equally nice place.
And very few apartments match the quality of homes, at least condos in the city. I loved my old apartment, but it was built cheap to look nice, sure I could get better, the ultra luxury apartments but they cost more than my mortgage for what I’m owning now an no tax break. My place has fantastic appliances, I made the seller replace them. Solid walls, i never hear neighbors, concrete on 1 side of me, i can comfortably play movies loud at 1AM without worry.
The big point made in this article to take heed of, and it’s exactly how I felt, and why I didn’t buy anything for a long time is make sure you are financially ready. But when you are you can make real estate work for you.

I constantly hear the nagging from friends and family that I should buy a house and start a family. I think you made a good point about the social ideals that get pushed to us on such things. Few have the curiosity to think for themselves and honestly ask if it is right for THEM rather than what is being told to them.

I’m a little more at peace. Thank you!

Despite these negatives a quick back of the envelope calculation shows that renting and investing in today’s market (at least on the right coast) probably sucks less than renting.

Take a 2 bedroom apartment in the Aria 2 building ( a newer, kinda cool place in a Vancouver suburb) as an example. It might sell for about $475,000 which equates to a monthly mortgage payment of about $2765 over 25 years at 5%. (No down payment for simplicity’s sake.) Throw in $220 for maintenance and $200 for property tax and the total monthly payment is $3185. Ouch!

A quick check of Craigslist shows the same apartment is renting for about $1350. So renting saves you about $1825 per month. Clearly there is an imbalance here. If you were to invest the difference, especially in RRSPs which have a tax advantage, you are going to be ahead.

In general, I favour real estate over renting at the point in which purchasing is less than or equal to the cost of renting.

The one thing that is lacking, which is mentioned in the comments, is the noise factor. If you have a loud neighbor there is a higher chance that you will go crazy. Or if you have a weird schedule, in an apartment or condo you might be restricted from activities such as listening to music loud or watching movies loudly.

I had to go through similar thoughts not too long ago, but my wife and I decided to rent instead of buy at the moment. Because I’m an entrepreneur, the chances of my income fluctuating is very high, so we decided it was best to rent until we can pay a significant portion of a house as a downpayment.

Keep up the great work! Thanks again!

We save $4,000/month by renting. (Yes, I’m completely serious and I have all of the numbers to back this up.)

The value of the house we live in is, in addition, dropping by about $90,000/year.

I’m happy to have my money working for me (gaining interest) instead of against me (paying interest on a depreciating liability.) It doesn’t mean I’ll never buy, but it does mean house prices are going to have to drop a lot more for me to be interested in buying.