Is it better to buy or rent?
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it → buy → ?
Try our calculator based on 2 decades of historical data
Buying a property is the largest purchase most Canadians will make in their lifetime.
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Canadians → try → lifetime
For many, it’s also their biggest investment.
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it → ’ → many
But strictly financially speaking, are you better off putting down a large down payment and facing higher monthly costs as an owner, or remaining a renter and investing your savings somewhere else?
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you → speak → savings
Who ends up with more money in their pocket at the end of the day?
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Who → end → day
To answer this question, we analyzed over two decades of historical data on property prices, rents, inflation and interest rates across 22 Canadian metropolitan areas, alongside long-term stock market returns.
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we → answer → returns
Using this data, we built an interactive simulator.
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we → use → simulator
Every time it runs, it calculates the monthly expenses and financial gains for three distinct paths: an owner with a fixed-rate mortgage, one with a variable-rate mortgage and a renter.
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it → run → mortgage
Whenever the renter's monthly costs are lower than the homeowner's, those savings are automatically invested in stocks and bonds to compound over time.
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savings → invest → time
The simulator projects these financial paths over a 25-year period across 1,000 unique scenarios.
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simulator → project → scenarios
Some scenarios feature high rents and low interest rates; others simulate average inflation paired with weak stock market returns.
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others → feature → returns
Every outcome represents a possible future based on historical patterns and the options you select.
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you → represent → patterns
Of course, no one can predict the future.
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one → predict → future
This tool provides probabilities, not guarantees, and should not be used for major financial decisions.
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tool → provide → decisions
You can find a more comprehensive version with expanded options and a detailed methodology breakdown at the end of this article.
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You → find → article
Home prices decline, while stocks surge
Our simulator is not perfect.
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simulator → decline → ?
The past is no guarantee of the future, and many macroeconomic factors are bound to change.
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factors → bind → future
Canada’s population is aging, the immigration outlook remains uncertain, an AI bubble could crash stock markets and countless variables continuously reshape the broader economy and housing markets.
uncertain
variables → age → economy
Because comprehensive historical data is limited, our tool is based on the last 25 years, meaning it does not account for Canada's last major housing crash in the early 1990s.
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it → limit → 1990s
Several experts also pointed out that the cost of maintaining a property is often higher than estimated, especially when a roof starts to leak unexpectedly.
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roof → point → property
Furthermore, realistically, few Canadians stay in the exact same home for a quarter-century.
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Canadians → stay → century
A sandwich board is shown on a street on Quebec's unofficial moving day in Montreal on July 1.
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board → show → July
Still, home prices have been declining over the last few years, while interest rates, average property taxes and maintenance costs have increased.
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rates → decline → years
Meanwhile, the stock market has been surging.
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market → surge → ?
An investment made in 2005 would be worth roughly seven times more today, compared to just three times more for a property bought at the same time.
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investment → make → time
Based on this, our calculations reveal a clear trend: If you rent an average studio or one-bedroom apartment and aggressively invest the cash you save by not owning a condo, you have a strong chance of pulling ahead.
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you → base → chance
But as soon as you step up to a two-bedroom apartment or larger, that math changes quickly.
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math → step → apartment
Rent prices swallow up the surplus, making it nearly impossible to save and invest meaningfully.
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it → swallow → surplus
In fact, in many scenarios, the monthly cost of renting eventually eclipses the cost of owning.
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cost → eclipse → cost
A homeowner's largest monthly expense is their mortgage, typically locked in for a five-year term.
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expense → lock → term
Adjusted for inflation, the real value of that payment actually decreases over time.
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value → adjust → time
Average asking rents fall 4.8% in August as trade war adds fresh uncertainty: report
Why N.S. rents are still increasing far faster than we saw historically for decades
Rents, on the other hand, almost always rise, often outpacing general inflation.
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Rents → ask → inflation
Eventually, the lines cross.
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lines → cross → ?
The renter begins paying more per month than the owner, wiping out their monthly savings and halting any new investment contributions.
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renter → begin → contributions
Location, of course, dictates everything.
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Location → dictate → everything
In some regions, owning a condo loses the least amount of money after all cumulative expenses, compared to renting a two bedroom or bigger.
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owning → own → bedroom
Buying and then selling a condo is not a guaranteed profit.
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Buying → buy → condo
Single-family houses or townhouses offer a higher probability of financial return, but they come with a much steeper upfront purchase price.
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they → offer → price
Yet for millions of Canadians, this debate is purely theoretical, and renting is their only option.
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renting → rent → Canadians
Half of all couples in the cities we analyzed do not earn enough to qualify for an average condo in the city they live in — a figure that jumps to two-thirds for a house.
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that → analyze → house
…and 36 more, not listed.
The Aporia
