Should you rent or buy a home and what are the long-term costs? On the one hand, you're tired of your landlord. On the other hand, buying a home likely means borrowing a lot of money. As well, when buying a home you must make a down payment, money that could otherwise be invested or put into savings. What should you do?
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Important notice: This calculator assumes that if you rent, you will invest all the money you would have used as a down payment. In addition, the calculator assumes that the money saved from renting relative to owning a home would also be invested. Many (perhaps even most) people may be tempted to spend rather than invest the savings. For those with less than iron self discipline, buying a home could constitute a form of forced savings.
* We wish to thank York University Professor Moshe A. Milevsky, and researchers at the Individual Finance and Insurance Decisions (IFID)Centre, a non-profit corporation, housed at the Fields Institute in Toronto, for developing the content of this calculator.