Not sure whether you should rent or buy in Kelowna in 2025?

With the housing market in flux and interest rates higher than recent years, choosing between renting and buying is more nuanced than ever.

This post compares the finances, pros, and cons of renting vs owning an apartment/condo in Kelowna, BC in November, 2024.

• 2-bedrooms, 1/2 baths
• 1,000 to 1,200 sq ft
• budget: $500,000 or $3,000/mo

Financial Overview: Monthly Costs of Renting vs a Mortgage

To start, let’s look at the upfront and ongoing financials of renting and buying, based on the current rates for fixed and variable closed-term mortgages.

Cost of Renting a 2-Bedroom Apartment

In November 2024, a 2-bedroom apartment in Kelowna rents for $2,000 to $2,800 per month.

Monthly Rent: $2,300/yr (median price) to $2,800/mo (luxury unit)

Tenant Insurance: ~$400/yr

Total Monthly Cost: $2,340 - $2,840

Remember to budget one month’s rent for the damage/pet deposit.

Looking to rent in Kelowna, British Columbia? Browse our inventory of Kelowna rental properties with condos, townhomes, and single-family homes available.

Cost of Buying a $500,000 Condo

With a 20% down payment of $100,000 (to avoid mortgage insurance), here’s how the monthly mortgage payments break down at today’s rate options (October 31st, 2024):

5-Year Fixed (4.77% APR)
Monthly Mortgage Payment: Approximately $2,136
Property Taxes (est.): $175
Condo Fees (est.): $300
Maintenance (est.): $200
Total Monthly Cost: $2,811+

5-Year Variable (5.38% APR)
Monthly Mortgage Payment: Approximately $2,252
Property Taxes (est.): $175
Condo Fees (est.): $300
Maintenance (est.): $200
Total Monthly Cost: $2,927+

You can also expect to pay around $1,000 to $5,000 for property maintenance each year, including appliance replacements, painting, and minor renovations.

Newer units may need less upfront, but costs rise over time. Utility expenses can add another $1,500 to $3,000.

Buying a $500K condo leads to higher monthly housing costs than renting in this scenario ($2,600/mo vs $2,300/mo), but you build up home equity with each mortgage payment.

Let us know if you’d like a deeper breakdown or need an estimate for a specific condo development!

3 Reasons to Buy

Investment and Equity Building

If you expect the housing market to improve in the long run, buying a home allows you to build equity with each mortgage payment, creating ownership that may grow in value as the property appreciates.

While home prices fell in 2023, Canadian home prices have appreciated by around 6.5% annually over the past few decades, with even higher appreciation rates in cities like Toronto and Vancouver.

Make it Comfortably Yours

When you own a house, you have full control over the property, letting you create useful features like a hobby garage, a vegetable garden, or an outdoor play area.

You also get carte blanche to paint, remodel, and personalize the house however you like, so long as you’re not restricted by homeowner association rules.

Put Down Your Roots

Owning a home often leads to deeper connections with neighbors and your community.

You’re more likely to build friendships and feel like part of the neighborhood, giving you a stronger sense of belonging and a better experience in your community.

3 Reasons to Rent

Flexibility & Mobility

Whether it’s for a new job, school, or a change of scenery, you have the flexibility to pick up and relocate with minimal hassle.

When you move, you’ll never worry about agent fees, closing costs, or capital gains taxes.

Renting can also let you live in desirable neighborhoods or cities where buying would be out of reach, giving you access to better amenities, schools, or jobs without the long-term cost of ownership.

New to the Kelowna area? Check our furnished Kelowna rentals.

Predictable Costs and No Hands-on Repairs

When you rent, your expenses stay stable every month. You won’t have to pay more for property taxes, condo insurance, and most maintenance expenses associated with the rental home

Renters get to avoid unexpected, high-cost repairs like leaky rooftops, broken furnace / HVAC systems, or issues with plumbing.

Homeowners typically budget 1% of a property’s value per year for maintenance and repairs, which you’ll get to save instead.

If you live in a managed apartment, your property manager will take care of routine tasks like snow shoveling and landscaping, so you can keep things simple and focus on what you enjoy.

Low Risk, Low Commitment

When you rent, you get to avoid the 25 or 30-year commitment associated with a new mortgage, 

While you won’t have anything to show if housing prices increase, you won’t have to worry about your home losing value or being stuck with an underwater mortgage in a down market. Renting can feel liberating and give you the ability to save for other goals like education, travel or investment.

Low-risk Investments in Canada

Whether you decide to rent or buy, here are some low-risk investments to consider with moderate interest rates:

• 1-year to 5-year GICs, paying 4%

• 5-year Government of Canada Bonds, paying 3%

• High-Interest Savings Accounts (HISAs), which pay 3.45% to 3.6% for larger balances

These investment options can help you grow your capital with predictable returns, while giving you the option to reinvest or adjust your investments as rates change.

What Income Do I Need to Afford a $500K Mortgage?

Flexibility & Mobility

Your monthly income should be high enough to keep your housing expenses around 30% of your gross monthly income.

If your monthly housing costs total $3,000/mo, to stay at 30% you require a gross monthly income of $10,000 ($3,000 / 30%), which translates to an annual gross income of $120,000.

Is Buying or Renting Right for You?

Ultimately, the decision comes down to lifestyle, future plans, and financial goals.

If you’re committed to staying in one place and view property ownership as a long-term investment, buying might be the right move.

However, if you’re looking for flexibility and prefer lower monthly costs without the responsibility of maintenance, renting and investing your excess budget elsewhere may be more suitable.

Considering a Move? Vantage West Realty Can Help You Buy, Sell, or Rent!

Whether you’re ready to buy your first home or simply want to explore your options, our team has the local knowledge to find you the best possible property to rent or buy.

Contact Vantage West Realty today!

Need to sell your house fast and get out of the housing market?

We can help you list your house quickly, or get you an instant cash offer that puts money in your bank in as few as 7 days.