Renting or Owning a Home in Canada – What’s Right for You?

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Sooner or later, many newcomers to Canada, face the question: “Should I keep renting a place or should I finally be buying my first home in Canada?” 

Like every situation in life, there are pros and cons to both options. It all comes down to your particular situation and specific needs.

So let’s look at both options.

Pros of renting:

  • Greater flexibility than when you own a house. This is perfect for those who might face sudden changes such as a job relocation.
  • You might be able to afford to rent a place in an area where you cannot afford to buy.
  • It is easier to move out when renting, rather than for the homeowner, as there is no need of finding someone to take over the lease, or to look for a buyer for the property as this is not your responsibility.
  • Lower additional cost. As a tenant, basically all you need is the insurance to cover the contents of the home. When you own, there are many more additional expenses.

Cons of renting:

  • You’re bound to the rules of the lease agreement, which includes limitations to renovate.
  • You cannot make any changes to a rental property unless you have the landlord’s consent.
  • Renting offers no return on investment or wealth creation. The property never legally belongs to the tenant.
  • There is no guarantee that your lease will be renewed after it expires.

Pros of buying a home:

  • Owning provides a long-term benefit of equity and security.
  • Over time, the value appreciates creating potential profit when you decide to sell.
  • A purchased house is your legal property. This means greater freedom. You as do not have to deal with rules established by a landlord.
  • You can alter the property however you choose (renovating, landscaping, décor changes, etc.).
  • As a homeowner who makes the payments on time, your credit profile and credit history will look great.

Cons of buying a home:

  • Regular house maintenance and mortgage repayments are a constant responsibility.
  • Additional homeowner costs include insurance, taxes and maintenance expenses.
  • There is always a risk of not making any profit when you sell your house because of uncontrollable factors like high interest rates or even a recession.
  • Home ownership comes with limited mobility compared to renting, where all you need to do is to give appropriate notice instead of waiting for your home to sell.

Hands On Experience:

Former newcomer from the Ukraine Anna Prokofieva opted to buy. She explains why:

“Personally I was rushing into buying a home in Canada as I believe that it is better to pay money towards my own equity. Don’t get me wrong. I did my share of renting in Canada and didn’t have any bad experiences. However, even renting as an immigrant in Canada, I never enjoyed the lack of freedom and stability.

"Buying a home is going to be your largest investment in life, so you have to consider many things prior to making that decision. I started with evaluating my current financial situation, my current and future needs, the location and the type of housing what would work best for me and estimating my financial responsibilities that come with purchasing a house.  The most important thing for me was to establish credit in Canada from the moment I arrived."


"After I made this decision, I got pre-approved for the mortgage so I knew what I could afford. During the whole process you will need documents confirming:

  • Your finances, such as confirmation of your down payment, bank account number and transit number for payments, list of assets and liabilities and your Pre-Approved Mortgage Certificate, if you have it.
  • Your employment, such as an employment letter from your current employer and confirmation of your income.
  • Information about the house you are buying, such as condo fees and property tax estimates (outlined on the real estate listing), heating costs, your lawyer's name, phone number, postal code and address, full address of the property, which includes postal code and legal description, a copy of the real estate listing, and a copy of the accepted Purchase and Sale Agreement."

For a new immigrant, the biggest difficulty might be the credit history as you may not have a credit history that Canadian banks recognize. You can take the first step before you even arrive in Canada by opening an account before you arrive.  You can learn more about how to do this here.