“I guess you’re right.”
“Look, when you buy your own place, you’ll be making about the same monthly payments. Some of that payment is interest. But some of that money will go to paying down the mortgage. If you’re going to be paying all that money, you might as well be paying yourself. Down the road, you’ll end up paying off the mortgage, and you’ll be left with the house free and clear. If you don’t buy, you could pay rent for years and years and years, and at the end of it all, you’d have nothing left.”
It’s a pretty compelling pitch. That’s why it works so well. While you’ll hear the pitch from many, many people throughout your life, the first people who usually give you the pitch are the people you look to most for advice: your parents, grandparents, aunts and uncles, friends, classmates, and co-workers. Because they’re people you trust, it’s easy to believe them. After all, what they’re telling you sounds good. Soon you might find yourself a member of the cult you didn’t even know existed.
These days, it’s nearly impossible to go a day without talking, reading, or hearing about housing. Every media outlet runs stories about recent house price movements, sensationalizes the unrelenting demand for housing by profiling houses that sold for huge amounts “over asking,” and reports the opinions of economists, investors, and bureaucrats on the subject of whether Canada is experiencing a “housing bubble” or if everything is just fine. Canada’s housing market has even been regularly making the news elsewhere around the world. Stories in foreign papers, magazines, and websites have appeared, mainly focused on how Canada’s housing market managed to avoid the crushing collapse of house prices that took place in the United States between 2006 and 2011, and how by most metrics Canadian housing is now very expensive.
At home in Canada we live it every day, where the unrelenting push to buy housing continues despite what every commentator agrees are high house prices, whether they think it’s a bubble or not. This unwavering commitment to the cause is characteristic of cult-like behaviour and is what makes this kind of groupthink so dangerous. The unconditional support for home ownership seems so absolute that no argument or evidence to the contrary could change the minds of cult members, regardless of how compelling it might be.
The unconditional support for home ownership seems so absolute that no evidence to the contrary could change the minds of cult members, regardless of how compelling it might be.
Not convinced you’re among cult members? Housing is everywhere you look, from stories in the newspaper to items on the evening news, from conversations on the street and in the change room at your rec league to chats at dinner parties and around the office. You can’t avoid it, and it’s even spawned its own entertainment genre.
Have you ever found yourself watching Sell This House? How about Holmes on Homes ?
There are dozens and dozens of shows available in Canada and all around the world dedicated to buying, selling, renovation, repair, construction, and any other aspect of housing.
Property Brothers
Marriage Under Construction
These shows get good ratings. People are fascinated not only by the challenge they face in finding the right place to live, but also with watching others work through the difficulties of figuring out where and how to live.
Fantasy Homes by the Sea
Million Dollar Listing
Housing can be a very personal thing. It’s something every person on the planet has to have, and it can say a lot about who we are.
Flip This House
The Unsellables
The fact that good advice is hard to come by makes it even more entertaining to watch others struggle through these challenges.
Flipping Out
Curb Appeal
The potent combination of the personal nature of housing and the casino-like atmosphere of ever-rising house prices is nearly impossible to resist!
The Real Estate Pros
Property Ladder
Need I go on?
Buy Me
My First Place
Okay, I will.…
Property Virgins
Love It or List It
Have I made my point?
All of the arguments against renting appeal to our inner consumer, who just wants to buy nice things.
You’ve probably heard of several of these, but not all of them. And you’ve probably seen at least an episode or two of a couple of them. Nearly every one of them focuses on some aspect of owning homes: buying, selling, flipping, renovating, or repairing a home someone has bought.
The point is that the cult is alive and well. It wants you to buy a house. And apparently it loves watching TV.
Not only is the cult alive and well, but it is successful. The home ownership rate in Canada is currently at an all-time high. Nearly 70 percent of Canadians own their homes, a number that has been rising consistently since Statistics Canada began tracking it in 1971 and has surged sharply higher over the past twenty-five years, from 63 percent to over 69 percent.
You’re probably not reading this book if you haven’t felt some anxiety about housing. I’ll bet you’ve also felt a lot of pressure to buy a place to live and have had a lot of people tell you renting is a waste of money. You might already own a home. Part of the cult’s promotion of home ownership is convincing people that owning a home is better than the alternative — renting — and that makes for a lot of criticism of renting. In fact, the positive and attractive features of renting are rarely discussed or celebrated.
On the other hand, all of the arguments for owning, and against renting, sound reasonable and appeal to our inner consumer, who just wants to buy nice things. Selling the public on the merits of owning a home plays directly on a number of innate and learned behaviours: a need for shelter, a sense of belonging, competitiveness and pride, and the desire for physical and financial security. But sometimes when a sales pitch sounds a little too good, when it just doesn’t feel right, there may be a problem. Listen to your gut.
Deciding to buy a place is a huge decision, and you shouldn’t buy a place just because everyone else agrees that you should. There is nothing wrong with owning a home. It’s not a bad thing. But taking a hard look at ownership reveals that it’s not all it’s cracked up to be. It’s also not the only choice, and while renting gets a bad rap, it has a lot to offer.
I’m here to tell you that renting is okay. It’s more than okay — it can be amazing! You don’t need to feel bad about living a rental lifestyle. In fact, you can feel proud about it, and I’m going to tell you why. Renting can be a great financial decision, provide enormous lifestyle advantages, and allow you to avoid the crushing financial leverage and anxiety that comes along with huge mortgages.
CHAPTER 3
Repeat After Me: Renting Is Okay!
Renting is a beautiful thing, and don’t let anyone tell you otherwise. The unsung hero of the housing world, renting is beautiful in its simplicity. Pay a fixed amount of money for the right to occupy a space for a fixed amount of time. It’s that simple.
Some of the amazing things about renting are quite easy to see.
Commitment-Lite
Renting can be a casual relationship and one that you can change up with relative ease as your needs change. The length of a lease is typically quite short — usually one year or less, but often as short as thirty days, depending on how long you’ve been renting and what province you live in. That means that if your housing needs change, you won’t have to wait long to move to a new place that accommodates you.
Renting