Real Estate Talk:
Buying vs. renting

Owning a home is one of the best and most secure investments people have

By Joseph Marovitch

September 3, 2025

There are numerous articles discussing homeownership versus renting, and many Canadians are discouraged from purchasing a property for various reasons. Some of those reasons include higher prices, an uncertain market, tariff war, geopolitical conflicts affecting the supply chain of goods and services, and possible recession.

The world has changed, and consumers have a right to be cautiously defensive. All these issues impact our inflation, interest rates, and our personal finances. At the same time, Canada faces a housing shortage, and rents have risen significantly; however, there are still major pros and cons to consider when deciding whether to buy or rent.

For many Canadians, owning a home represents many things. For most homeowners, a house represents their life savings, education for the children, financing for a business, or retirement.

Owning a home affords future opportunities and puts money to work, as opposed to renting. Rent does not work for the renter; it does not grow in value. Rent is money that goes away.

Granted, owning a home is a significant commitment of time, energy, money, and emotion; however, it is also one of the best and most secure investments people have in the long term. A property’s value increases over time if it is purchased in the right location at the right price. A property can be refinanced to borrow against it, acquire a homeowner’s line of credit or a reverse mortgage.

Owning a home affords future opportunities and puts money to work, as opposed to renting. Rent does not benefit the renter; it does not increase in value. Rent is money that goes away.

Each mortgage payment adds to your equity. Each rent payment is money gone from your pocket.

Renting is good until one finds an affordable home or if one is in retirement. If an individual has made enough money over their lifetime, why not sell the house and then rent and travel?

However, there are two out of four phases in life when a property is the investment that determines the future for many people. First, know what the four phases are:

Phase 1 – Childhood through teens – no property required yet
Phase 2 – Adulthood – buy first home
Phase 3 – Parenthood – buy a larger second home
Phase 4 – Kids have moved out, and parents sell the home to buy or rent something smaller

Phase 2 is when children have grown up and moved away from their parents. The grown-up children are starting to work, make money and can now invest in a home.

Phase 3 is when the same children now have families of their own and require a larger home.

Phase 4, where people are downsizing, is when the long-term investment of owning a home comes to fruition. Many people have other forms of income, but a home is the passive money maker that contributes to the children’s future and the parents’ next step in life.

‘With rising interest rates, more homes will come to market, and pricing will be more negotiable and affordable. Eventually, the market will stabilize, and inflation will decrease as well.’

There are risks in purchasing a home, but the risks can be mitigated by doing the following:

• Have a thorough inspection of the property before purchasing
• Check all the expenses of the property
• Choose good locations
• Pay market value, not more or less
• Purchase the property in a living trust

When purchasing in a living trust (a legal arrangement), the trust owns the property; however, the purchaser is designated the trustee. This means the trustee controls everything concerning the property. Purchasing a property in a trust can protect the home from creditors and legal issues. A trust permits the owner to decide how the property will be managed and distributed when the owner passes, and a trust can reduce tax implications for the children who inherit the home. For more information about living trusts, please consult with your accountant or tax lawyer.

The information in these articles is a summary. Should you have questions or comments, please refer to the comments section at the bottom of the page. As well, to view past articles, click here.

State of the market

Many buyers are discouraged from purchasing a property due to political and economic uncertainty. U.S. policy in all areas of life has created an uncertain and erratic world. In using the carrot and stick method and monetization politics instead of diplomacy, several nations have merged, including Russia, Iran, China, India, and North Korea.

The U.S. was the leader of the free world, characterized by inclusion and diplomacy; however, this has changed with the “America First” policy, which has led to the formation of new alliances. The situation makes the future uncertain as a new world order emerges from the vacuum created by the U.S. Over the next few months, with the U.S. mid-term elections approaching, things may improve over time.

Acquire the most advantageous price and terms, purchase in a good location that will permit the property to increase in maximum value, take mortgage protection insurance, and purchase in a Living Trust.

How does this affect our market? Buyers must take every advantage possible when investing in a new property. The purchase process must be precise, surgical and tactical to protect against almost all eventualities. Acquire the most advantageous price and terms, purchase in a good location that will permit the property to increase in maximum value, take mortgage protection insurance, and purchase in a Living Trust. Consult your accountant, real estate lawyer and use a good broker.

Have a great week.

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