Originally Posted by you&me
This is the crux of it.
Whoever said renting returns 0% wasn't accounting for the equity component of owning that, as you said, in Calgary for the last 10 years has basically been stranded, non-producing capital.
20% on an average house is about $100k. From an investment standpoint, Calgary real estate would not have been my first choice as a place to park $100k over the last 10 years... It would be worth roughly, um, $100k today (not even going to factor in property taxes and upkeep)... That's horrendous.
I may be biased because we're currently renting while we find the right opportunity to build. Our original intention was to buy, but when we couldn't find the goldilocks home, we started looking at rentals.
At first it felt a little strange to be renting at this stage in life, but I've come to appreciate certain advantages we're experiencing. For one, we're in a slightly nicer (probably ~20% more expensive) home than what we sold, but our monthly nut is a little under 1/2 of what it had been paying; we're well under what an typical mortgage payment would be and there are savings from property taxes and other ownership costs that aren't ours to bear now.
On top of that, the equity freed up from the sale of our last place has been far more productive, which feels nice.
Lots talk of the intangible benefits to owning a home, usually the "security", but unless you're mortgage free, that whole "security" thing seems a little suspect to me. On the flip side, I now feel a certain intangible "freedom" knowing that most every part of our living situation is more, um, liquid now.
Obviously there are compromises to renting which is ultimately why we're still looking to buy - that's what it will take to get us everything we want & need in a home for our family. But we're also ok with our current circumstances and not in a rush, which is an entirely different feeling from when I was a first time home buyer and got out of renting. I'm sure there's a FOMO component to all of this, but with how things are right now, I'm please to sit back and cheery pick an opportunity.
|