How long do I need to stay in a house to break even?
Long enough for the price to recover everything you paid to get in and everything it costs to get out, and that is two numbers rather than a year count. This app prices the first from your own purchase price and municipality. It does not hold the second and does not forecast appreciation, so it will not hand you a break-even year.
Add the cash you never get back on the way in: land transfer tax, doubled inside Toronto, plus legal fees, title insurance, inspection and the sales tax on mortgage insurance. The closing cost tool totals that half against your own price, and it separates the lines set by statute from the ones that are still a quote you have to go and get.
Then add the cost of selling, which is commission plus legal fees. Nothing in this build holds a commission figure, because it is what you agree with a listing brokerage rather than a published rate, so that half of the arithmetic is a number you have to bring.
Appreciation has to cover both before you are ahead of having rented, and this app does not forecast it: any growth rate you use is your assumption and the break-even year moves with it. Run it at a rate you would defend, then run it at zero, because the second one is the case where the entry and exit costs are the whole of your loss, and those years were spent paying interest rather than rent.
The implication is practical: if there is a real chance you move within three years, for a job, a relationship or a growing family, buying is an expensive way to find out.
What it depends on
- your entry costs, which turn on the price and the municipality
- what selling costs you, which you agree with a brokerage
- whatever the property does in price, which nothing here forecasts
Answer it with your own numbers
You will need: purchase price, down payment, municipality.
Price your own entry costsNext questions
Should I buy, or keep renting?
It turns on how long you will stay, because the cost of buying and the cost of selling are each paid once and neither builds equity. This app prices your entry costs from your own price and municipality; what selling costs you depends on what you agree with a brokerage, and no figure here forecasts what the property does in price.
Canada-wide
What is land transfer tax and how much will I pay?
A provincial tax on the purchase price, charged at marginal rates that rise with price and paid by your lawyer on registration. Inside the City of Toronto a second municipal tax applies on top, which at ordinary prices is close to the provincial amount and at high prices is more.
Ontario