Rent or Own a Home as a Newcomer 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 buy my first home in Canada?" 

Like every situation in life, both options have pros and cons. It all depends on your particular situation and needs (and on housing affordability).

So, let's look at both options. And perhaps the handy calculator at the bottom of this story can guide you as you decide whether to rent or buy in the Canadian housing market: 

Pros of renting:

  • Greater flexibility than when you own a house. This is perfect for those facing sudden changes such as a job relocation.
  • You can afford to rent a place in an area where you cannot afford to buy.
  • It is easier to move out when renting than for a homeowner, as there is no need to find someone to take over the lease or look for a buyer for the property; this is not your responsibility.
  • Lower additional cost. As a tenant, you only need insurance to cover the home's contents. When you own, there are many more additional expenses.
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Cons of renting:

  • You're bound to the lease agreement's rules, which include renovating limitations.
  • You cannot change a rental property without 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.
  • You're not building equity through home ownership.


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, which means greater freedom. You do not have to deal with rules established by a landlord.
  • You can alter the property (renovating, landscaping, décor changes, etc.).
  • As a homeowner who makes timely payments, your credit profile and credit history will look great.
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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.
  • Homeownership comes with limited mobility compared to renting, where you only need to give appropriate notice instead of waiting for your home to sell.

Research reveals that almost three-quarters of immigrants want to buy a home in Canada within three to five years of arriving. Newcomers are also buying homes in Canada faster than ever. 

Buying a home is an investment

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

"I was rushing into buying a home in Canada as paying money for my equity is better. Don't get me wrong. I did my share of renting in Canada and had decent 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."




Pre-approval for mortgage in Canada

After Prokofieva made the decision to buy, she got pre-approved for the mortgage, so she knew what she could afford. During the process of buying in the Canadian housing market, you will need documents confirming the following:

  • 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 most significant challenge might be the credit history, as you may need 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.

Finally, here's that handy calculator to help newcomers decide whether to buy or rent when they arrive in Canada. 


  • In Canada, renting or buying a home can have pros and cons.
  • Renting offers flexibility and lower upfront costs, but buying can provide security and potential equity.
  • Buying comes with additional responsibilities like mortgage repayments and maintenance costs.
  • Carefully evaluate your financial situation and establish credit before making a decision.


Action Plan for Newcomers to Canada:

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Steve Tustin is the Editor for Rentals for Newcomers and a contributing editor for Prepare for Canada. He is also the former managing editor of and a former senior editor at the Globe and Mail and the Toronto Star.

*Rentals for Newcomers used no AI-generated content in the writing of this story, and all sources are cited and credited where possible.

© Rentals for Newcomers 2024