To rent or to buy?

It has become a popular topic- should you rent or buy a home? It's a good question, but with no clear answer.

Take a look at your current situation. If you're single- living in a high-priced market like Vancouver or Edmonton and have a job with an average salary, then maybe it's smart to rent for now. However, not all markets are pricey and everyone's situation is unique.

Families with children usually prefer owning. The stability of ownership and providing a good home for the kids becomes a deciding factor. Having two incomes in the household can make mortgage and housing payments more manageable. If commuting isn't a problem, house prices outside a major city center offer more value- bigger houses for lower prices.

Here are a few pros and cons to buying a home;

Pros-

Offers long-term benefits of security, equity and potential growth in personal wealth. Also a home's equity value will appreciate over time- when it comes time to sell, you'll earn a profit.

A house is your legal property, which allows your greater freedom than a rental property. You can alter the property, including decor changes, landscaping and renovations to suit your own needs or style.

You have the option of becoming the Landlord by renting a portion of or the entire house. This allows you to generate income and help pay the mortgage.

Cons-

It's a huge financial responsibility

There's additional costs to owning a home- taxes, insurance and maintenance

You run the risk of not making any profit through resale

You are less mobile than a tenant

Here are a few pros and cons to renting

Pros-

Flexibility. Renting requires no long-term commitment from a tenant, and is the best option if you don't intend on staying in one place for a long time.

As a tenant, there is the possibility of living in an area in which you could not afford to buy

The only insurance you need is to cover your own stuff in the house (content)

Cons-

You are bound by the rules of the lease, which can impact your freedom to use or renovate the property.

Renting offers no wealth creation or return investment

You have no control over annual rent increases

There is no guarantee that a lease will be renewed when it expires