Rent vs buy calculator for Canadian homes
Short answer
Buying a home beats renting when the equity you build and the home's price growth outweigh the costs you never get back: mortgage interest, property tax, maintenance, strata fees and the costs of buying and selling. Renting wins when those costs are high or your stay is short, because your down payment can grow invested instead.
Compare renting and buying
What your down payment would earn invested
Legal, inspection, transfer tax
Realtor and legal fees
Verdict
After 10 years, renting leaves you about $1,781 ahead.
Is it better to rent or buy a $750,000 home in Canada?
With 20% down and a 4.5% mortgage, owning a $750,000 home costs about $4,707.80 a month in the first year once property tax, maintenance, strata and insurance are added. A comparable rental costs $2,800.
After 10 years the buyer's wealth is about $522,231 and the renter's, with the down payment invested at 5%, is about $524,012. Renting comes out ahead by about $1,781.
What if you only stay five years?
Over five years, renting comes out ahead by about $33,126, because buying and selling costs are spread over fewer years.
What are the unrecoverable costs of owning versus renting?
Over 10 years in the example, the unrecoverable costs of owning add up to about $481,224: interest, property tax, maintenance, strata, insurance and transaction costs.
A renter's unrecoverable cost is the rent itself: about $385,186 over the same 10 years with 3% yearly increases.
How do interest rates affect the decision in 2026?
The Bank of Canada raised its policy rate by 0.25 points to 2.50% on October 28, 2026, its first increase since July 2023 Bank of Canada. Higher rates raise mortgage interest, the largest unrecoverable cost of owning.
How do I compare renting and buying?
- 1
Pick how long you will stay
Transaction costs make buying expensive over short stays, so compare over your realistic time horizon.
- 2
Add up unrecoverable costs of owning
Mortgage interest, property tax, maintenance, strata fees, insurance and buying and selling costs are money you never get back. Principal is not: it becomes equity.
- 3
Count the opportunity cost
Your down payment and closing costs could be invested instead. Include what they would earn.
- 4
Compare wealth at the end
Buyer: home value after selling costs, minus the mortgage still owed. Renter: the investment portfolio. The higher number wins.
Frequently asked questions
How much down payment do I need to buy a home in Canada?
At least 5% of the first $500,000 and 10% of the portion between $500,000 and $1.5 million. Homes priced at $1.5 million or more need 20% down. With less than 20% down you also pay CMHC mortgage insurance.
Is paying rent throwing money away?
No. Owners also pay costs they never get back, such as mortgage interest, property tax, maintenance and the costs of buying and selling. The fair comparison is rent against those costs, plus what your down payment could earn if you invested it instead.
How much is CMHC mortgage insurance?
With less than 20% down, CMHC insurance is 4.00% of the loan with 5–9.99% down, 3.10% with 10–14.99% down and 2.80% with 15–19.99% down, added to your mortgage.
Where do these numbers come from?
Mortgage payments use semi-annual compounding as on Canadian fixed-rate mortgages, and CMHC premiums use the standard schedule CMHC. Home price growth, rent increases and investment returns are your assumptions, not forecasts.