How renting vs. buying a home in Hamilton compares with rest of Canada

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Published March 22, 2023 at 11:02 am

The cost difference between renting vs. buying a home in Hamilton is about the same as it is in Vancouver and Toronto.

An analysis from the brokerage firm Zoocasa touches on the renting vs. buying question in 21 metro areas across Canada. It looks at “how much more affordable” the former is. Traditionally, it costs less to rent than to pay a mortgage each month, although the latter helps an individual build credit and equity.

The difference in Hamilton between the former ($2,031 average rent) and the latter ($3,427 average monthly mortgage payment) is just under $1,400. Toronto and Vancouver have around a $1,500 housing choice gap. Mississauga is in the $2,000 range.

Hamilton has the 11th-highest rents, and sixth-highest average mortgage payments. The gap between the two is larger than in other similarly sized Ontario cities.

Ottawa, though, has less than a $400 gap ($2,148 rent, $2,527 mortgage). London-St. Thomas’s is under $500 ($1,943 to $2,406). Kitchener-Waterloo has an $826 difference ($2,129 vs. $2,995).

Zoocasa sourced rent data from Rentals.ca, and home prices from the Canadian Real Estate Association. The mortgage payments were calculated by assuming a 20 per cent down payment at a mortgage rate of 4.69% amortized over 30 years on the average-priced home. Additional costs for each were not considered, such as utilities or property taxes.

Only two areas were found to to have mortgage payments that are less expensive than rents. The average rent in Winnipeg is $1,435, while the monthly mortgage payments for the average home would amount to $1,360 a month. In Quebec City, the mortgage payments each month would total $1,300, just shy of the average monthly rent of $1,355.

Halifax-Dartmouth has only a $2 difference ($1,993 rent, $1,995 mortgage). The gap in Montréal is under $200 ($1,881 vs. $2,077). Generally, renters in Québec enjoy much stronger tenant protections than their counterparts in Ontario.

Zoocasa notes that rental prices have been “on a very slow decline of late.” It also notes that a run of stability in the federal lending rate could lead to more people looking in earnest to buy a home and get out of renting.

“The housing market could see increased activity as we move into the spring, and as the Bank of Canada has not budged on its current lending rate, sideline buyers might finally make their move,” Zoocasa writes.

(Graphics: Zoocasa.)

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