The Pros and Cons of Homeownership

Reasons to buy rather than rent:

1.) Pride of ownership and freedom... Home ownership frees to you from ties to a landlord to whom you must defer about decorating, painting, renovating, landscaping, which pets are allowed, etc, etc. Most homeowners will tell you the joy that comes with owning your own place - creating that dream kitchen, planting a garden that suits your mindset, adding a fence for the family dog and the list goes on. What would you put on your own list of pros?

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2.) Take advantage of today's low interest rates, government incentives for first time buyers and moderating prices... Interest rates - just ask your parent's or your grandparents what they think about today's rates! Well, they have not always been so low and likely won't always be so low in the future either.

3.) There are a number of government incentives available now for first time buyers...

First-Time Home Buyers' Tax Credit (HBTC) - Announced with the recent federal budget: www.cra-arc.gc.ca/gncy/bdgt/2009/fqhbtc-eng.html

Land Transfer Tax Refund For First-Time Home Buyers - You may qualify for this provincial program: www.rev.gov.on.ca/english/refund/newhome/

Home Renovation Tax Credit - If you do any renovations in 2009, including any painting, basement finishing, adding a deck, change of flooring, etc, you may be eligible to receive the home renovation tax credit: www.budget.gc.ca/2009/pdf/pamphlet-depliant3-eng.pdf

4.) Investment... When you pay rent to a landlord, you are paying his mortgage. When you pay a monthly mortgage payment, a portion goes to home equity and hence toward your own personal net worth. Plus, over a lifetime, real estate has only ever increased in value - you could realize a healthy capital gain (tax free when the house is your principal residence!).

Are There Cons to Homeownership Too?

Maybe... read on.

1.) Financial obligations - consider the savings that may be required to come up with the down payment, the obligation of meeting your regular mortgage payments and the ongoing costs of property tax and maintenance and repair. Are you ready to take this on?

2.) Responsibility - you alone (or you and your partner) are responsible for payments and repairs. Again, are you ready to take that on?