Compare the total 10-year cost of renting versus buying in Canada.
10-year buying cost vs renting cost
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Total buying cost (10 yr)
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Total renting cost (10 yr)
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CMHC premium
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Your breakdown
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Why the monthly payment is the wrong number to compare
Many Canadians compare only the monthly mortgage payment to monthly rent and declare a winner. That misses most of the cost picture. Buying involves one-time transaction costs at purchase: land transfer tax, legal fees, and potentially CMHC insurance. It involves ongoing costs beyond the mortgage payment: property tax, maintenance at roughly 1 percent of value per year, and home insurance. It also involves opportunity cost: your down payment tied up in equity could be earning investment returns if you rented instead. This calculator adds up all of those costs over 10 years and shows which path actually costs more cash out of pocket, adjusted for the home equity you have built and the investment portfolio you would have accumulated as a renter.
How CMHC and land transfer tax affect the comparison
Two closing costs that dramatically affect the rent versus buy math in Canada are CMHC mortgage default insurance and land transfer tax. If your down payment is below 20 percent, CMHC insurance adds 2.40 to 4.00 percent of the loan to your mortgage balance. On a $700,000 home with $70,000 down (10 percent), the CMHC premium is $28,140, which gets amortized over 25 years and generates extra interest. Land transfer tax on that same $700,000 home in Ontario is roughly $9,475 before any rebate, paid in cash at closing. Together these closing costs can easily exceed $30,000, which must be recovered through appreciation and equity before buying breaks even with renting.
The break-even question: how long must you stay?
The longer you stay in a home, the more the closing costs get averaged over years, and the more equity you accumulate relative to a renter. In high-appreciation markets like Toronto and Vancouver, buyers have historically broken even within 4 to 6 years. In slower markets or during periods of flat prices, the break-even can stretch to 10 years or longer. This calculator uses a fixed 10-year horizon, which is long enough to see whether the purchase makes economic sense for most mid-term buyers. If you expect to move within 3 years, renting almost always wins on total cost even with strong appreciation.