[Bring_Back_Shantz]

Originally Posted by Radley77

Try this rent vs. buy calculator:

http://www.ic.gc.ca/epic/site/oca-bc.../ca01821e.html


Also, here is a rental yield calculation for a two bedroom condo in Calgary:

December 2007 Calgary Condo Price = $304,719
Residential Tax Rate = 0.0054614
Annual Taxes = $1,664
2007 Calgary Two Bedroom Condo Rent =$1089/month
Condominium Fees = ~$150/month
Calgary Rental Yields = (1089*12-150*12-1664)/304719 = 3.15%

That yield is less than many safe investments like savings accounts, long term bonds or GIC's that can earn up to 5.00%.

Rental yields are only marginally above inflation (2%). And if you were to consider that Calgary inflation is likely 3 or 4% you would be looking at a rental property that is actually a loss in wealth.

That is why there is a financial advantage of renting vs. owning even over an extremely long time horizon.

Okay, sure, that's great if you're talking about owning a secondary property for rental purposes, but how exaxtly does that pertain to the rent vs buy arguement?