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Rent vs Buy: Which is Better in 2024 in Victoria BC

Rent vs Buy: Which is Better in 2024 in Victoria BC
rent vs buy

Victoria, British Columbia is a highly desirable place to live. Dubbed the “Garden City of Canada,” Victoria’s lush, natural beauty, mild climate and lively cultural scene attract visitors and new residents from all over Canada and beyond. 

Because it is so desirable, Victoria is also very expensive. It is expensive to rent here, and it is expensive to buy as well. The housing and rental market has been unsettled throughout Canada over the past few years, but now that we’re into 2024, and past the uncertainties of the pandemic, where does the market stand in Victoria BC? Is it better to rent or to buy a home if you want to live here  — and many do: Victoria’s population grew by about 3% in 2022 and 2023. The answer to that question relies on a number of factors, including: market trends, personal finances, as well as lifestyle preferences. In this article, we’ll take a look at the pros and cons of renting vs buying in Victoria BC through the lens of each of these 3 factors.

1. The Victoria BC Market Trends in 2024

While the Victoria housing market turned sharply down in 2022, we are starting to see a gentle rebound. As well, recent political moves could help make renting more affordable in Victoria, BC.

Renter’s Perspective

Despite various political measures to try to fix the housing affordability crisis in Victoria BC over the past few years, demand has continued to exceed supply. Rent rates have been rising dramatically making them unaffordable for many. At the beginning of 2024 the vacancy rate was 1.6%. At that rate, units have not stayed empty for very long, and there has been no incentive for landlords to offer good rates.

However, recent regulatory changes that abolish short-term vacation rentals, should open up more inventory for long-term rentals. These measures came into effect in May 2024. Presumably, this will eventually help curb the rapid increases in the cost of renting in Victoria BC. As it stands, rental rates in Victoria in 2024 are about 20% higher than the national average, according to the Zumper rental market trends. The average cost of rent (across all bedroom counts) is $2,302.00. with the average price per square foot being $3.74. If you are just entering the rental market, you can expect to be paying more than that. 

Buyer’s Perspective

The Victoria BC housing market is still in a strange place, recovering from all the upsets of the pandemic years and their fall-out. According to the analyst at House Hunt Victoria, so far in 2024, we are in a slight seller’s market, but without the usual price increases that usually correspond to a seller’s market. While sales are alright — not phenomenal, but okay — and inventory still not overly abundant, there has been an increasing number of new listings coming onto the market this spring, and this has kept house prices from rising exorbitantly thus far in 2024. There is some question as to why there’s been an increase in inventory, with some pointing out that a large number of people holding fixed rate mortgages will need to renew in 2024. The higher interest rates could be forcing homeowners to sell. 

From a buyer’s perspective, even though house prices haven’t increased much at all compared to the same time last year and in some cases actually dropping, and even with inventory levels increasing for some buyers, this hasn’t been enough to offset the recent higher interest rates, therefore making the dream of owning a home difficult at this time. For those who can afford it, especially if they can manage a very large down payment, it may be a good time to buy. Unless there is a significant change in interest rates, the trends of this spring — more inventory and slower than normal sales — may tip us into more of a bona fide buyer’s market as the year goes on.

2. Personal Finances and Goals

As the market trends suggest, if you are hoping to move to Victoria BC from elsewhere (other than Vancouver or Toronto, which are both more expensive), your personal finances will play a definitive role in the feasibility of your plans, regardless of whether you plan to buy or to rent.

Personal Finances and Renting in Victoria BC

Only about 30% of your income should go towards rent, and in fact, if you don’t meet this criteria, some landlords will not rent to you. Since incomes in Victoria BC have not kept up with the cost of living, this could be a problem for many on the lower end. The benefits of renting from a financial perspective is that you will have lower initial costs, generally just the security deposit, and as well, you will not be responsible for any maintenance costs.

Personal Finances and Buying a Home in Victoria BC

If you are in a good financial position to purchase a home in Victoria, now might be a good time to buy. Unlike the years prior to 2022 when we were in the midst of a buying and selling frenzy with houses selling within days of being put on the market, now, as a buyer, you will be able to take your time without so much pressure. However, since the market isn’t likely to explode upwards any time soon, expect buying to be more of a long-term investment than it was in the few years prior to 2022.

As to reducing the impact of high interest rates, there are a number of steps you can take, including: working with a broker to find the best mortgage deals and coming up with the largest down payment possible, thereby reducing your final mortgage amount.  

3. Lifestyle Considerations

Without even considering the financial aspect, renting vs buying a home appeals to very different lifestyles or needs. Home ownership offers more stability and freedom to customize your living space to suit your needs. Renting, on the other hand, is great for people who want or need the flexibility to move quickly and easily and who do not want to be burdened with maintenance worries and expenses.

Pros and Cons of Renting vs Buying in Victoria BC in 2024

To sum up, whether renting vs buying a home in Victoria in 2024 is best for you depends on a number of personal considerations as well as market trends. From a financial perspective, if you enjoy stability, and you can afford it, buying might be a good course of action in 2024. However, if you need or value flexibility, renting is the way to go.

Pros of Buying a Home in Victoria in 2024

  • Higher initial costs (compared to renting)
  • House values over the long haul are still increasing albeit at a slower rate
  • Opportunity to build equity
  • Victoria is possibly shifting towards a “buyer’s market” with a large amount of inventory and lower prices
  • There is less pressure now to buy the first acceptable house you find, which means more choices 
  • If you are able to qualify today, you’re facing less competition as many are struggling to do so, due to the current prices & rates. 

Cons of Buying a Home in Victoria in 2024

  • Currently higher interest rates
  • Possibly not a good short-term investment
  • Risky if the market turns downwards
  • You are responsible for upkeep, mortgage, taxes etc.

Pros of Renting in Victoria BC in 2024

  • Lower initial costs compared to buying
  • More flexibility
  • No risk in a downturn
  • Predictable monthly payment, with no added expenditures

Cons of Renting in Victoria BC in 2024

  • No building of equity
  • Very little stability

Try Our Rent vs Buy Calculator To Get a Definitive Comparison

While our discussion in this article has been quite general, when it comes right down to it, you’ll want to compare actual dollars and cents. Auxilium’s Rent vs Buy Calculator is a good place to start. If you’ve decided that owning is the best choice for you, contact our team and we’ll help you to get the best mortgage for your situation.

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