Comparing to owning a home, living in an apartment rental is incredibly easy. Why do the work yourself when you can enjoy the following benefits:
· Dedicated property and maintenance staff to call if anything goes wrong
· No back-breaking snow shoveling, lawn maintenance or pool / sauna care
· One single monthly rent cheque usually pays for everything (instead of several separate bills and fees when you own a house or a condo)
You Get More for Your Money
Believe it or not, you can usually rent an apartment or house for much less than the cost of buying it – especially if you live in a larger city. And if you want to be right downtown, renting is almost always more affordable than owning a condo (and you get a lot more living space, as well, as downtown apartments are usually much larger than downtown condos).
As well, apartment renters do not have to come up with the thousands of dollars in down payments, closing costs and fees for things such as building inspections, legal counsel, land transfer taxes and insurance.
And this does not even factor in the cost of borrowing – in the first five years of ownership, most mortgage payments are applicable only to the interest, not the capital. This is money that you will not get back when you sell your home (and you'll still have all the hassles and extra costs of putting your house on the market).
That Tax Break is Not Guaranteed
Getting a big tax break is supposedly to be one of the greatest advantages of owning a home – but you can not always rely on getting this break. If your annual mortgage interest payment, plus any other discounts you are entitled to, is not greater than your standard tax deductions, you will not receive any tax benefit from owning a house.
If you rent an apartment, however, you'll always receive some form of tax relief, as a large portion of your rent is tax deductible every year.
Renting provides an enormous amount of flexibility. You can pack up and leave immediately at the end of your lease (which can be monthly or yearly, whatever best suits your lifestyle) – there's no waiting to sell and no agonizing about the housing market before you move. For many people, the freedom to live where you want and when you want is a huge benefit that simply can not be overlooked.
For homeowners, the stakes are incredibly high should their finances crumble. When they can not pay the mortgage, the lender has great leverage – the house and all the equity invested in it could be in jeopardy. That's not to say there are not consequences if a tenant can not pay the rent – but the financial devastation that comes with losing your home is far greater than being evicted from your apartment.
In addition, there are several social service programs that are run by all levels of government to help people in need pay their rent so they will not be evicted. Are the banks as lenient or supportive when it comes time to pay the mortgage?
Ultimately, making the decision to either rent an apartment or buy a home involves much more than simply comparing rental rates, mortgage payments, lease lengths and tax breaks. It's a combination of all of the personal circumstances happening in your life – both now and several years down the road.