Seven versus three. An investment made in the stock market in 2005 would be worth roughly seven times as much today; a property bought at the same time, roughly three times. That ratio sits at the centre of a simulator built by Nael Shiab at CBC News, which models the oldest question in Canadian personal finance — rent or buy — with more data than the question usually gets.
The mechanics: more than two decades of historical property prices, rents, inflation and interest rates across 22 Canadian metropolitan areas, plus long-term stock market returns. Each run of the simulator tracks three financial paths — an owner with a fixed-rate mortgage, an owner with a variable-rate mortgage, and a renter. Whenever the renter’s monthly costs fall below the owner’s, the savings are automatically invested in stocks and bonds and left to compound. The model runs 1,000 scenarios over a 25-year horizon, sweeping combinations of high rent with low rates, average inflation with weak equity returns, and so on. Costs counted include mortgage payments, insurance, property taxes, maintenance, condo fees, rent and eventual selling fees.
The output is probabilities, not answers, and the limitations are stated plainly. The dataset covers the last 25 years, so it excludes Canada’s last major housing crash in the early 1990s. Experts consulted noted that maintenance is often underestimated until a roof leaks, that few Canadians stay in one home for a quarter-century, and that an aging population, uncertain immigration and a possible AI-driven crash could all break the historical patterns the model is fitted to.
Where the answer flips
The result is not ‘rent beats buy’ or the reverse; it is a function of unit size. Renting an average studio or one-bedroom while aggressively investing the difference leaves the renter with a strong chance of finishing ahead. At two bedrooms and above, the arithmetic reverses: the rent itself consumes the surplus, and there is nothing left to compound.
The crossover is driven by one asymmetry in how the two cost streams behave over 25 years. An owner’s largest payment — the mortgage — is typically locked in for a five-year term, and inflation erodes its real value each year. Rents almost always rise, often outpacing general inflation. Eventually the lines cross: the renter’s monthly outlay exceeds the owner’s, the monthly saving goes to zero, and new investment contributions stop. In many simulated scenarios, renting ends up costing more per month than owning.
Location overrides everything else. In some regions, owning a condo merely loses the least money relative to renting a two-bedroom or larger — buying and selling a condo is not a guaranteed profit. Single-family houses and townhouses carry a higher probability of financial return, but at a much steeper entry price.
The half that can’t play
For half of all couples in the cities analysed, none of this is a live choice: they do not earn enough to qualify for an average condo in their own city. For an average house, the share rises to two-thirds. Single-income households — a growing demographic — fare worse still.
I would argue there are two housing crises in Canada. One is the housing crisis for the middle class, affording a condo in places like Toronto, Vancouver and increasingly in Montreal, especially since the pandemic. But there’s an affordability crisis as well for low-income Canadians, who really need help just finding a place to live.
That was Aled ab Iorwerth, deputy chief economist at the Canada Mortgage and Housing Corporation. The second crisis barely figures in rent-versus-buy arithmetic at all.
A May 2026 Statistics Canada study documents what affordability does to timing: younger Canadians live with their parents longer, and settle careers, families and property purchases later — a pattern the researchers call ‘life-stretching.’ When they do move out, they live alone or with roommates more often than earlier generations. “Timing is everything,” said Jean-Philippe Deschamps-Laporte of Statistics Canada’s Centre for Housing and Income Statistics, who worked on the report. Buying later compresses the compounding window: “Younger generations could face returns that are not what they would have had if they had been born earlier.” His own research shows that graduating into a recession scars lifetime earnings; the same logic applies to housing and equity markets, where the entry price is set by your life stage, not your judgment.
The experts quoted push back on the premise as much as the model. “The most important thing is to do some introspection on how much owning a home will actually improve your life,” said James Macek of the University of Alberta’s business school. Kiana Basiri of Toronto Metropolitan University questioned the default: “We just assume ownership is the best way for people to accumulate wealth over time, but I feel we need more education for people on how they can invest their savings in different ways.” Households that chase affordability to the suburbs, she and others noted, occasionally forget to price the second car against the transit pass. Economist Jean-Pierre Lessard of Aviseo Conseil put the national bias flatly: “We are crazy about property ownership in Canada, but there is no link between a nation’s economic growth and its homeownership rate” — and told a May 2026 conference that an average Quebec City or Montreal household can build more wealth as renters. The number the simulator cannot give back is the decade of compounding lost to a down payment saved too slowly.