Buy vs rent scenario
Buy vs rent in British Columbia with property transfer tax
British Columbia’s property transfer tax adds to closing costs, while low property tax rates reduce running costs.
After 10 years, buying finishes ahead of renting by about $7,240. On these assumptions buying overtakes renting after about 9.9 years, once selling costs are counted.
Year-by-year results for this scenario
After 10 years, buying finishes ahead of renting by about $7,240. On these assumptions buying overtakes renting after about 9.9 years, once selling costs are counted. The owner's first-month cash cost is $5,511, compared with $3,025 for the renter.
| Year | Home value | Mortgage balance | Buyer net worth | Renter net worth | Buying minus renting |
|---|---|---|---|---|---|
| 1 | $983,250 | $743,064 | $188,030 | $254,653 | −$66,623 |
| 2 | $1,017,664 | $725,357 | $238,905 | $298,628 | −$59,723 |
| 3 | $1,053,282 | $706,844 | $291,748 | $344,403 | −$52,654 |
| 4 | $1,090,147 | $687,489 | $346,638 | $392,059 | −$45,421 |
| 5 | $1,128,302 | $667,253 | $411,161 | $441,684 | −$30,523 |
| 10 | $1,340,069 | $551,392 | $729,894 | $722,653 | $7,240 |
Questions people ask
Does buying beat renting in this scenario?
After 10 years, buying finishes ahead of renting by about $7,240. On these assumptions buying overtakes renting after about 9.9 years, once selling costs are counted.
What changes in this scenario?
British Columbia’s property transfer tax adds to closing costs, while low property tax rates reduce running costs. All other inputs keep the calculator’s default planning values.
Is this a forecast?
No. It is an illustration of how one assumption changes the buy vs rent comparison. Replace the inputs with your own numbers.
Other buy vs rent scenarios
- 5% down, 30-year amortization
- 20% down, ten years
- Five-year stay
- Seven-year stay
- Fifteen-year stay
- Full amortization
- Rates at 6.5%
- Rates at 3.5%
Educational illustration; not advice. See the assumptions.