Renting versus buying a home, report weighs the costs right now in Mississauga

A new report weighs the costs to own a home versus renting in Mississauga and across the GTA.

The latest real estate numbers put the average price of detached homes in Mississauga at $1,602,425, and the benchmark price at $1,473,000 in June.

And Mississauga places fourth in Canada for highest rents. A one-bedroom place comes in at $2,362 and a two-bedroom unit was at $2,821 in June.

So which is more affordable renting or buying in Mississauga?

A new report from real estate brokerage Zoocasa finds renting is less expensive right now but there are several factors to consider.

Using numbers from the first quarter of 2023 (lower than current numbers), Zoocasa found the average home in Mississauga was $1,112,531, rent for that home would be $2,737, and average mortgage payments would be $5,146.

“It’s vastly more affordable to rent than it is to buy a home, currently,” the report states.

And the recent announcement from the Bank of Canada that key interest rates are increasing to five per cent will increase mortgage payments for many people. Of course, the size of mortgage payments also depends on how much a buyer can afford for a downpayment.

The cost difference isn’t the only factor. Homeowners build up equity, and break away from landlords who may decide to raise rents or evict for renovations. And as homes become less affordable, rents also rise.

“With higher home prices, and, more significantly, a lack of housing supply that is likely to persist for a while, the rental market will benefit from those either priced out or just unable to find a home,” Zoocasa notes.

And Mississauga isn’t alone, the majority of cities in the GTA have average home prices of over $1,000,000. A home at $1,000,000 would set you back $4,626 on monthly mortgage payments.

So, where can people find a better deal?

The most affordable city in terms of mortgage payments in the GTA where data is available is Orangeville, according to Zoocasa. The monthly mortgage payment for a house at the average price is $3,920. Rent in the city is an average of $1,663, just under $2,300 a month cheaper than monthly mortgage payments.

The next most affordable is Oshawa, where mortgage payments would be $3,954 a month on an average home costing $854,822, whereas rent payments would set you back $1,992 a month.

See the full report from Zoocasa here.