Rent or Buy?

  • So in the last 12 months i've been doing some pretty hard saving and now i'm in the ballpark for buying my first home. i've started looking at cheap 1 bedroom apartments in the city.

    however i'm still not entirely sure if i want to outright buy a place atm or keep saving while i rent a place.

    What were the main things you guys looked for when you first bought/rented a place? and do you think it's better to rent somewhere cheap while saving? or buy a place outright, save while paying off a mortgage, then sell the place and upgrade to better house/apartment later on?

  • Global Moderator

    @yoshi This is just my opinion, but I would say rent until you really know what you want. Dont rush into buying something just to get a place to stay. Let it take time. I'm still renting but thats a lot due to not being 100% sure where I want to be, both work wise and life wise. If you already got a job that you know you like and you got the savings I would say you could look into places to buy, but dont rush into buying in right away (unless it feels really really right).

  • atm i'm not rushing into anything. just trying to weigh up the pros and cons of both atm.

    in some ways it seems like buying myself a small 1 bedroom apartment could turn out cheaper than renting in the long run. if i buy 200,000-$250,000 property. then i'd only be paying about $870 a month on my mortgage. but if i rent then i'd be paying about $1000 per month just on staying in the room. the big pro in owning an apartment in that respect means not only would it be a tiny bit cheaper than renting a place each month. but that money would also be going towards paying off a place that i can also sell later in the future.

  • When we first moved in together, we rented because we had no other option (ie. we were very poor). Renting is good because it is commitment-free or at least limited to the term of your lease. It's great if you're young and/or are not sure if you want to stay in the neighbourhood/city. It's also really good because any maintenance is not usually the tenant's responsibility so there are no surprise costs that pop up. The major issues we had with renting were: the money was paying somebody else's mortgage, having to move when a landlord sold, not being able to paint/renovate etc, watching the circus that is the Vancouver housing market rapidly rise to a point of pricing us out.

    Since buying our place, I would say I feel much, much more comfortable but that may be heavily based on personality. I feel much more relieved that our family cannot have our house sold by somebody else and also that we can change anything we don't like whenever we want. Beyond the emotional aspect, the money we pay for it is paying our own mortgage as well as building equity and credit. Plus, if an absolute disaster should occur, we have an asset that we can sell or borrow against. The biggest risks I find with owning are 1. that surprise costs that come up (appliances, roof etc) are yours alone to bear and 2. the market and interest rates fluctuate so, in the absolute worst case, it could get to a point where your mortgage is worth more than your home. Now, number 1 will absolutely happen and it really sucks when it does but at least you know that any money you put in will probably improve your standard of living and/or increase/maintain the value of your asset. As for number 2, fluctuations in value and interest will definitely happen but likely not to the point of catastrophe and not overnight so you will have a chance to get out if you really need to. Furthermore, as long as you are staying in the same market, property values tend to fluctuate as markets (areas) so if, when you are looking to upsize, the value of your place has decreased, it's likely that so has the value of the place you are looking to buy.

    As lotias said, we looked around and made sure we found a place we loved in the area we wanted at a price that didn't cripple us. And we were also sure we wanted to stay in Vancouver and knew that, if that changed, selling in Vancouver would likely put us at a plus if we wanted to buy in our other option down the road, as opposed to the reverse (Tokyo was our other option - hopefully that weeb game guy doesn't read that).

    I hope this helps at least somewhat and please let us know if you have any other questions.

  • @yoshi In my opinion, you should look for buying a house. The prices keep on increasing and you might regret later of not buying it. You can sell this one buy another if you feel like.