For many people, buying real estate is seen as the superior choice over renting. Yes, it’s a given that there are certain advantages to home ownership – building up equity, having your own property, and increased privacy as your dwelling is disconnected physically from others. However, owning a home is not always a perfect fit for everyone! Upkeep can be expensive, there are a lot of extra responsibilities, and while equity is often expected in today’s market, it’s not a guarantee. If you’ve been mulling over your options recently, here are four considerations to keep in mind when making your decision.
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1. Canada’s new mortgage rules may make it more difficult to qualify for financing.
Since January 1st, 2018, new regulations have been implemented which may result in you having to buy a smaller home. This new mortgage “stress test” has been put in place to determine if mortgagees will be able to handle interest rates that are much higher than their current contract rate.
It is estimated that the rule will likely affect about 100,000 home buyers across BC. This is also not just for those with new mortgages that require mortgage insurance, either – these rules will also affect those who are renewing or refinancing a mortgage as well.
Check out this article on Global News to learn more.
2. Lending interest rates going up means that it is more expensive to obtain a mortgage.
The Bank of Canada announced on January 17th that it would be raising the Canada Interest Rate to 1.25%. This is a substantial increase from 1.0%, where it has been holding steady since September 2017.
source: tradingeconomics.com
By the end of 2018, interest rates are forecasted to hit 1.75%, and 2.25% by 2020. This increased cost of lending means that renting may start to look more attractive.
source: tradingeconomics.com
3. Rental living on Vancouver Island is more affordable than the Lower Mainland.
| Average cost of 1 bedroom in Vancouver: $2,020 Average cost of 1 bedroom in Nanaimo: $800 |
Average salary in Vancouver: $55,349 Average salary in Nanaimo: $43,378 |
On average, renting in Vancouver is 2.5 times more expensive than that in Nanaimo!
In fact, 67% of those currently renting in Vancouver are unsure about whether they will stay in the area over the next five years. The average salary in Vancouver is disproportionate to the cost of housing. CMHC estimates that rental prices will only continue to increase over the next two years, as Vancouver’s population is forecasted to expand by 1.4% during this period.
4. Quality purpose-built rentals by experienced general contractors.
There has been an uptake in the amount of multi-family rental developments in Nanaimo, in response to consumer demand and the age of existing buildings. As well, the influx of people from larger, more expensive metros such as Vancouver and Victoria coming to Nanaimo has created a jump in demand – builders and developers are more than happy to respond! More and more, people are looking to not be tied down by the responsibilities of ownership, but are still want to have a nice place to live.
In 2017, Colliers International reported 16 new purpose-built rentals were set to be constructed in the next few years, increasing the number of units in the city by 800. Among these is Westmark’s very own Apartments at Pacific Station!
Why would you want to rent at Pacific Station? Pacific Station is Nanaimo’s premier mixed-use development, combining commercial space with residential townhomes and apartments. The Apartments at Pacific Station will be the final phase of the development, as all townhomes have long been purchased, and commercial space is nearly sold out! The Townhomes at Pacific Station are also award-winning, being recognized with the Award of Excellence in the 2017 Commercial Building Awards. Pacific Station offers a central location, and the rental building will offer 60 1- & 2-bedroom suites with balconies, stainless steel appliances, and more!
Whether you’re choosing to rent in order to save on interest or housing costs – or new regulations have made the choice for you – renting in Nanaimo is definitely the way to go for some. Not only that, your options for quality rental suites are on the rise, thanks to developers and builders.
Westmark Construction has significant experience in building and construction management on Vancouver Island.
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