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Renting or Home Ownership: What is Right for You?

If you visit the U.S. for longer periods of time – or are relocating for school or for work – you’ll need to decide whether home ownership or renting is the right option for you.  Be sure you weigh all the pros and cons.

If you think you may be mobile for your job or educational pursuits, renting a property may provide the best short-term solution for your housing needs.  With renting you’ll have:

  • Lower up-front costs.
  • The ability to keep your lease short so you are not tied to a particular location.

Renting does have its draw-backs:

  • Rent payments increase at the end of each lease period causing your expenses to rise.
  • There are generally limitations in your lease as to how much you can personalize your living space.
  • You are subject to the landlord timeline with regard to repairs.
  • There are no U.S. tax benefits when you rent.

Plus, when you rent you lose out on the opportunity to build equity in a home.

Perhaps the largest benefit of home ownership is that ability to build equity.  Consider this:  a rental payment of $1,200 per month for five years equates to $72,000 in rent – funds which could have been applied toward a mortgage, generating equity.   In addition, if you purchase:

  • The interest on your mortgage may be tax deductible in the U.S.1
  • You have the ability to have total control over the property’s interior and exterior, to truly personalize the space and make it your own. 

With today’s low interest rates and wide selection of properties available at competitive prices, now may be the ideal time to make a real estate purchase in the U.S.

There is also that sense of accomplishment that comes with owning a home – whether it’s your primary residence, a long-awaited vacation property in the U.S., or perhaps an investment property for the future. 

If you are considering purchasing a home in the U.S. there are many differences in obtaining a mortgage in the States as compared to Canada.  The process is typically longer to apply for and secure a mortgage in the U.S.  In addition, consider your credit history.  Most financial institutions can only utilize U.S. credit history to underwrite a loan.  If you are a Canadian citizen, it would be to your advantage to seek out a mortgage lender who can also look at your Canadian credit history. 

To learn more about the differences and what to expect when seeking a mortgage loan in the U.S., please read:

Depending on your individual needs, the choice to rent or buy when visiting the U.S. is one that warrants careful consideration.

1 Consult your financial, tax, legal and other professional advisors prior to applying for a U.S. mortgage.