 So I think this is a really important question for most people today and that question is should you rent or should you buy the home that you're living in? Now like any question in life, there is no black or white answer. So hopefully I just want to kind of shed some light on this topic today and specifically how I want to kind of address this is like I address in all my videos. It all depends on what you want in life and what is the purpose of you buying said property. It's all about attention. Everything comes down to life is what is your attention about this? And so I'm going to be talking about the Toronto market, similar to the New York market, San Francisco market, where property value is extremely high in Toronto specifically for a house in the even greater Toronto area, but the core area of Toronto, you're talking about no under than a million dollars for a piece of shit house. Condos are going for even 800, 900,000 for a shoebox condo that's like 700 square feet. So property value is really important. So there's a couple of things to take into consideration. I want to talk about norms and bell curbs. And if you're looking in Canada, I'm just speaking about Canada, if you're looking at both household income and male income. And if you're looking at across all careers, provinces and territories, the average income of a male is about 45 K, the average household income is between 60 to 70 that's combined household income. And let's say you are a new couple or an individual, doesn't matter, and you're decided that you want to buy a home in Toronto. First question and ask yourself, are you buying a home as a lifestyle choice? Because that's not an investment. You know, I'm more than happy paying whatever I got to pay for a house that I'm engineering my lifestyle to be a certain way. I don't view that as an investment. To me, that's the tax that I'm paying to live the life how I want to live it. If you're thinking, am I going to chop this house in five years? I don't give a fuck to tell you the truth. This is the amount of money I'm willing to spend to engineer my life. However you want to engineer your lifestyle, and if that's your decision, then you're not approaching this from an investment aspect. But let's say how most people are sold a dream is, oh, buy a house. It's the best investment possible. Okay, let's break down some numbers for you based on what I just told you with the 65k average household income with the average male making about 45k. All right, I'm just going to look at my computer over here. Maybe I will put up a picture over here. So let's say you just go outside of Toronto, not even outside, but maybe on the outskirts of Toronto, like Mississauga, et cetera. And let's say you want to buy a house for $900,000. The real estate market in Toronto for the most part is if property value, a house is over a million dollars, for the most part, you have to put 20% down down deposits, as that's $200,000. I don't know about you, but I don't know too many people, working class people, walking around with 200k liquid cash. Most people put down 5%. And so they've eased this a little bit, but if you put down underneath 20%, it's hard to get a mortgage, and then you got to get mortgage insurance, and then the interest rate is high. Here's some numbers here, because remember, most people are buying a house because it's a good investment. And remember, most people aren't making $100k a year. Most people don't have liquid cash. Most people are stretched right now, they're fucking stretched. And they're being sold as dream of buying a house and flip it and make 5x in 10 years, whatever. So let's look at some random numbers here. I just pulled this out. I think it's like from BMO. I don't even know which calculator it is, but some Canadian bank, 900k property. Let's say they put down 7.22. So above 5%. Here, it will make even better, 10%. They put down $90,000 as a down deposit, that's 10% of $900,000. You need mortgage insurance. Anything below 20%, you need insurance. So right away, you got that 25k insurance you got to pay. Then the mortgage on that is $835,000 that you own the bank. Remember, this is liability. And let's say it's a 20-year mortgage. Right now, roughly, there's different. You got fixed and then you got variable mortgages. Let's average it out, 2.61%. It's fucking low. I remember my parents telling me in the early 90s and so late 80s, early 90s, mortgage rates were in the high double digits and so many people lost their property because people couldn't carry the carry. People stretch themselves thin. It's like, if you don't have a buffer of at least 20-30% for what if scenarios, meaning if you're carrying something and something happens to you, let's say you lose your job, or we call it the God Clause, an unforeseen event happens in your life where you lose cash flow to pay for your overhead. And if you don't have a 20% buffer on that, you are fucking foolish to invest in anything. And so at 2.61%, 5-year variable, and obviously, take this as a great assault. I just randomly pulled this from the BMO calculator. There's other ones. I'm actually speaking here for the GTA area. Your mortgage on 10% down on a $900,000 property around Toronto is $4,464 that you owe every single month. You know the movie Goodfellows, where the mob, Henry's mob goes into business with the restaurant. And what do they say? Well, you got a flood, fuck you, pay me. Lightning hits, fuck you, pay me. No matter what, guess what happens? Every single month, the bank wants their money. And no matter what your situation is, well, fuck you, pay me. You own them $4,400. And then if you don't pay, you got interest, a cruise on that, et cetera. So right away, you got a high fucking overhead carry. You got $4,400 every single month you got to carry. And you got the mortgage insurance on top of that. Then you got something called a 1 to 3% principle on your house. So most people forget that, listen, it's a fucking house. Plumbing breaks. Well, guess who's paying? You. Something happens with the shingles. Guess who's paying? You. Oh, shit. Your electricity fucked up. Who's paying? You. Uh-oh. Something's happening with the foundation. Who's paying? You. You. You. You. So it's a good practice. So 1 to 3% of the total value of your house and every year, roughly, that's the maintenance cost. Then let's add some other things to that property tax. That comes out to let's say for something like this might be like, you know, five, you know, maybe $5,000 to $7,000 a year property tax on that. So you have all these other costs, but yet, but yet the average Canadian household income is $65,000. The average male is $45,000. So if you just do basic math is like you just, you don't have the, you don't have the finances to carry this at all whatsoever. And so most people are spreading themselves so thin. They're going in thinking this is a wise investment where it's the biggest liability ever. They just went into debt now at $835,000. They have mortgage mortgage insurance. They have to upkeep their house. They have property taxes. The guy that needed to have to take care of it's like, for me, how is this an investment? This is the biggest liability. God forbid you or your partner or you as an individual, you lose your job. What then? Who's going to pay your mortgage? Nobody. And this is the problem though. Like let's rewind. The problem is the fact that people believe where they live is an investment. It's not. There's nothing wrong with buying houses. I think buying houses for investment is smart if you do it right, especially if it's kind of set up like a bungalow where it's like a duplex where you have a basement in the top and you have double rental. And so the problem is they believe where they live is an investment. No, it's not. I'm a firm believer where you live, that's the cost that you pay for the lifestyle where you're at. It's not an investment, man. Forget that money. If you're in the business of thinking where you live is a proper investment, you're in the wrong business. If you look at real estate investors and I'm not a professional real estate investor, by all means. Take everything with a grain of salt. I'm coming to you just from basic mathematics and how the Toronto market is and just my personal experience buying some properties here and there. I look at this and I'm like, how is this an investment? You're on the line for everything. I would never get myself caught up in this. I have to pay $4,400 every month no matter what and all these unforeseen costs. Insurance, tax, maintenance. How's that an investment? No matter what, you've got to pay back the mortgage. Then somehow you're thinking, oh yeah, my 900K property, someone's going to triple in three years. It might. It might. I don't know. I highly doubt it in three years. It'll take decades for that. But at the end of the day, it's not a wise investment. You're stretched so fucking thin. It's a different story if someone comes to this, a 900K property and they're pulling in half a million dollars a year household income. That's a different story. They have the buffer. They can easily pay the mortgage. There's no problems there. The problem is I'm talking about the general populace where it's 65K average household income. That's what I'm speaking about. Most people aren't making their 100K, 150, they're not making six figure plus salaries and I'm talking for the general public here. My suggestion for them is rent because rent offers you flexibility, offers you sometimes better tax incentives. So if you have your own business, you can claim your office there. You can claim a bunch of stuff for your rent there as a home office and offers you flexibility. You don't have to worry about maintenance. You don't have to worry about property tax. You find a better location so you can pick up leave tomorrow. There's so much more benefits when it comes to rent as opposed to investing where you live. For me, it's like, okay, let's say you have some money, 20, 30K. There's a couple of options. I'm a firm believer in you do not want to stress yourself. You do not want to put everything on the line and if one dial moves extra, you're fucked. That's horrible position to be in. You need to have ... Warren Buffett has two simple rules. Rule number one, don't lose money. Rule number two, refer to rule number one, don't lose money. And so when you put yourself in positions of, hey, what if this happens? If you put in yourself in positions of variability, meaning man, there's a lot of things that could go wrong and if one thing goes wrong, we're fucked, well, guess what? You're going to end up like in 2008 United States, you're going to end up how Canada was in the early 90s. And that's horrible. And we're going to see this again, man. People are foolish, man. They're overstretching themselves thin that I think there's a study not long ago to show that people only have 400 bucks saving, $400 in saving. And so this is why they can't inflate interest rates right now in Canada. They're pushing them down and they're slowly trying to put them up, but they can't. This is why the Fed United States is trying to reduce interest rates and more QE, quantitative easing. People are stretching themselves thin. So my advice is if you got 20K on the side, what I like personally, I like REITs, real estate investment trusts. One, they're liquid. You can lock them up and tax is great because you get them as a dividend. So it's a lower tax bracket. So you can put your money in, you can have upside on real estate. You can join a bunch of different REITs out there. I won't tell you which REITs. You can do your own research. I'm not a stock portfolio manager or anything, but I think REITs are fantastic, statistically shown to get you greater than 5% yield per year based on what REIT you want to invest in. And number two, I'm a firm believer. And if you actually want to invest in real estate, do it as a real estate investor. Don't own where you live. Actually go as a real estate investor. I love duplexes and triplexes. I love the fact that you can find a good duplex. I'll give you an example around Toronto Kitchen and Waterloo. It's a university town. A lot of students, a lot of these students have big, fat ass government checks, OSAP, guaranteed checks for their tuition. And guess what? They need places to live. And guess what? A lot of these duplexes don't need too much upkeep because it's crazy fucking students. So you don't have to fancy it up. So you have guaranteed money from the government coming to these students that pay you automatically. Get yourself a duplex or even a triplex. Top floor duplex can pay for your mortgage. Bottom floor duplex can pay for taxes. A little bit comes out of your pocket maybe for maintenance, right? But the whole point is you're not on the line. It's not your liability for the mortgage. Yeah, you put down the down deposit on that duplex, but your tenants are paying for your mortgage. Your tenants are paying for your property tax. You're not paying for it. You're not on the line for it. And guess what? People always need to rent. So that's a big mental shift. It's not about should you invest in real estate. I think everyone should invest in real estate. I'm just a firm believer. I don't think so where you live should be your investment. If you're thinking that your home is investment, that's a wrong way of looking things. Do the same exercise I did. Pull up one of these mortgage calculators. Look at the income that you're making after taxes. Look at the property tax of the property you want to buy. Look at how much you're spreading yourself. If you don't have yourself a 20% buffer, forget the deal, man. That's a horrible, horrible deal. Like I said at the beginning of the video, I'm a firm believer where you live, like if you're actually going to buy property and live, that's the lifestyle choice, man. That's not an investment, man. Like I said, I'm more than happy to pay what I want to pay to live wherever I want to live. That's the luxury tax that I'm paying for that location and for that property so me and my family can live a certain way that we want to live. But let's flip that around. You got your 20K. Think as an investor. Do not have liabilities. That's the biggest thing. Half people pay for your mortgage. It's simple as that. I hope you guys enjoyed this video. Listen, I'm not a real estate specialist by any means. I'm just trying to use simple fucking logic over here. If you have any questions for me, leave a comment below this video and I'll talk to you soon. Peace. Oh yeah, by the way, comment, like, share. Always interested to hear what you got to say. Peace.