Actually I don’t know that he wants you to rent, but over at the Globe and Mail he’s got a column that compares owning to renting and it doesn’t make buying at these prices look so hot.
Do not base your thinking about your ability to afford a house strictly on what lenders or real estate agents tell you. They may have useful guidance, but their goal is to sell mortgages and houses. That’s why the affordability measures they use pretend you live a world where there are no claims on your household cash flow other than those related to your home and other debts.
Being able to amass the minimum 5-per-cent down payment on a house does not mean you’re ready to buy, either. In the real world of home ownership, 5 per cent is peanuts. By some estimates, the costs of buying a home – mover, property taxes and utility bill adjustments, legal fees and repeated trips to Canadian Tire or Rona could cost an additional 2 to 4 per cent of the value of your home.
I’m guessing the Globe and Mail doesn’t make as much ad revenue from real estate agents and mortgage brokers as the Vancouver Sun?