REAL ESTATE 101 - To Buy or Rent?

Real Estate Agent with RE/MAX Realty Specialists


You've heard it a million times from friends, family, relatives, colleagues and even people you don't know: "When you rent you're throwing your money away!" Very true.  And the longer you rent, the higher the rent rate becomes and you'll throw more and more of your hard-earned dollars away.

Here's an example.  If you're paying $700 a month for rent and you do so for the next 10 years you will have spent $84,000 and have absolutely nothing to show for it.  And if you paid that much for 25 years - a common mortgage period  - you'll have shelled out $200,000 and still have nothing! If rents went up over that time frame you would have paid much more.  Maybe it's time to consider the benefits of having a home of your own.

Money Drain

With today's low interest rates owning your home is more attractive then ever.  It's now possible that your hard earned money could go directly to paying for your own home rather than paying your landlords mortgage.

Buying your home makes sound financial sense and it's almost impossible to find one good reason why it's not a good move. Beyond having your own place, there are other benefits.


  • Increase in home prices mean increase equity for you - like putting money in a savings account.
  • Buying a home is a very effective way of saving regularly for 25 years.  We all know saving money isn't easy, but each mortgage payment is, in reality, a little bit of money put away for the future.
  • Mortgage insurance is relatively inexpensive and very easy to obtain.  If the home owner dies before the mortgage is paid the insurance pays off the balance of the principal therefore ensuring that your family will be left with a home - and without debt.
  • If you are 30 now and purchase your first home you will be mortgage free by the time you're 55 (or less!)
  • You'll also have a home worth thousands of dollars that you own free and clear and therefore you'll be more financially independent later in life.
  • The value of homes over the past 25 years have continued to increase, and most likely will for the next 25 years.  The home you buy today for $200,000 could conceivably be worth $400,000 or more when your mortgage is paid.  it's a sound investment.
  • Owning your own home allows you to set down roots and get involved in your community.  if there are children in your life, it allows them to make friends in the neighbourhood.  Remember where you met your oldest and dearest friends?
  • Additionally, there is real sense of security and personal pride that comes with owning your home.  Imagine choosing paint colours, or adding a deck, or remodelling a kitchen the way you want, not the way your landlord decides.
  • With many types of investments you have to pay capital gains tax on any money you make.  However, on your family home there are no taxes payable as its value increases.  You keep the money your investment makes.
Simply stated one of the best investments you can make is in a home of your own.  Home prices have traditionally beaten inflation thereby assuring you are in the money.

And, best of all, you really will have a place to call "HOME."


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Remember, the more you know about factors affecting real estate transactions, the wiser your purchase or sale will be!


Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. Carol Faaland-Kronmaier 04/26/2011 12:38 PM
Home Buying
Newfoundland Avalon Region St Johns
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Newfoundland and Labrador Real Estate Blog
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Sandra McCormick
Fort Worth, TX

What a great way to persuade renters to buy a home!! Thank you for saying it so well. 

Dec 02, 2010 02:47 PM #1
Bill Dilny
RE/MAX Realty Specialists - St Johns, NL

Thanks, Sandra

And I'm very lucky to be living in an area where we have suffered no downturn in our market over the past 3-4 years; in fact, our area has been the strongest in Canada!  But in any case, I'm a firm believer that even though the market is good here, I can't stop promoting home ownership as a wise investment in anyone's future.

Dec 03, 2010 12:04 AM #2
Carol Faaland-Kronmaier
Weichert, Realtors; Hillsborough - Hillsborough, NJ
PhD, e-PRO, Manville, Hillsborough, Somerset NJ

Bill, This has been the discussion in my real estate office over the last couple of months. Thank you for saying it so well! Carol

Apr 26, 2011 12:41 PM #3
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