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Rent to Own a Home in Spruce Grove, Alberta

3/11/24
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4
 min read
Rent to Own a Home in Spruce Grove, Alberta
Summary
If you're a considering to move and buy a home in Spruce Grove, Alberta, but the homebuying process can be challenging due to lack of Canadian credit and down payment. That's where Requity Homes comes in - their rent to own program can help you achieve your dream of homeownership
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Rent to Own a Home in Spruce Grove, Alberta

Spruce Grove, a flourishing community that offers a blend of small-town charm and contemporary convenience, is tucked away in the scenic heart of Alberta. This city, which has a population of over 35,000 people, offers a friendly environment to both individuals and families. Spruce Grove is the perfect spot to call home thanks to its excellent position in the Edmonton Metropolitan Region, which provides a distinctive combination of opportunities, a strong sense of community, and simple access to urban amenities.

The economy in Spruce Grove is both broad and strong. The city offers citizens a variety of work options with a focus on sectors including healthcare, education, technology, and retail. The citizens' access to employment opportunities is improved by its proximity to Edmonton, making it a popular choice for individuals looking for a job.

Spruce Grove's affordability is one of its best qualities. This friendly city's cost of living is about 7% less than the national average, with housing costs playing a large part in this cost advantage. Spruce Grove is a desirable option for people and families wishing to plant roots without breaking the bank because of its affordability.

There are several warm neighborhoods here, each with a distinctive personality. You'll find a community that fits your lifestyle, whether you're drawn to the convenience of Harvest Ridge, the scenic beauty of Greenbury, or the family-friendly vibe of Broxton Park.

Spruce Grove places a high value on education and offers a variety of schools to the local population. The city's proximity to Edmonton ensures easy access to post-secondary institutions and additional educational opportunities.

Real Estate Trends in Spruce Grove, Alberta

The real estate market in Spruce Grove has experienced consistent growth, drawing people and companies. According to recent data, the average home price has risen from 2022 to 2023 at an annual growth rate of about 26.1%, indicating the market's strength.

The housing supply is still evenly distributed and provides buyers with a wide selection of homes. Due to the city's diverse industry and close proximity to Edmonton, the real estate market has shown to be resilient.

There is still a high level of demand and competition, and houses frequently receive several offers. Rent-to-own options offer a another route to homeownership, which is perfect for people who are having trouble getting a mortgage.

Local real estate experts provide insightful information on neighborhoods, market patterns, and rent-to-own possibilities. Understanding these trends is essential for navigating Spruce Grove's dynamic market, whether you're a newbie or a resident thinking about buying a house.

Renting vs Rent-to-Own

The benefits and drawbacks of traditional renting versus rent-to-own arrangements must be carefully considered while evaluating your housing alternatives in Spruce Grove. Let's contrast the two choices, taking into account the price of renting a three-bedroom property and renting to buy a three-bedroom house.

Traditional Renting

  • Monthly Rent: Renting a 3-bedroom property in Spruce Grove typically involves paying a fixed monthly rent to the landlord or property management company. As of 2023, the typical rent for a three-bedroom house will be roughly $2,200 per month by 2023, depending on amenities, location, and property type.

  • Upfront Costs: Renters frequently need to pay an initial security deposit, which is typically the equivalent of  one month's rent.  This deposit is typically refundable upon the end of the lease if the property is in good condition.

  • Renting Flexibility: Traditional renting provides flexibility, as tenants can choose the lease term that suits their needs, whether it's a short-term or long-term rental agreement. However, renting does not build equity or contribute to future homeownership and faces the risk of eviction.

Rent-to-Own

  • Monthly Payments: Just like with traditional renting, rent-to-own agreements need you to make regular monthly payments. But often, a percentage of your monthly payment goes toward the house's future buyback purchase.

  • Option Fee: Rent-to-own contracts frequently call for a down payment, also known as an option fee, which can be anywhere between 2% and 5% of the property's purchase price. By paying this fee, you guarantee that you will eventually be able to buy the property at the agreed-upon price.

  • Building Equity: One key benefit of rent-to-own is the forced savings for your future down payment that is accomplished by setting aside a percentage of each month's rent payments. This enables you to gradually increase your equity while occupying the property.

  • Property Appreciation: If the property appreciates in value during the rent-to-own period, you may benefit from potential equity growth when you decide to purchase it.

Let's consider a hypothetical scenario for better comparison:

Traditional Renting: Assume you rent a 3-bedroom home for $2,500 per month. Over a three-year lease, your total rental expenses would amount to $90,000 ($2,500 x 36 months).

Rent-to-Own: In a rent-to-own agreement, you pay an upfront option fee of 2% of the property's purchase price, which totals $8,000 on a $400,000 home. Over the same three-year period, your total expenses would include the option fee and monthly payments, which might add up to $139,004, where $23,156 is the cumulative savings that goes towards your down payment.

While the upfront costs in a rent-to-own agreement may be higher, it offers the advantage of building equity and potentially benefiting from property appreciation. As of August 2023, Spruce Grove properties have increased by 26.1% from the previous year. Rent-to-own contracts give families the flexibility to lock in buyback prices, potentially saving thousands. However, it's essential to carefully consider your financial situation, long-term goals, and the specific terms of the rent-to-own agreement before making a decision.

Ultimately, the choice between traditional renting and rent-to-own depends on your individual circumstances and homeownership goals. 

If you're ready to take the next step towards homeownership, Requity Homes might be the best option to help get you and your family into homeownership sooner than you could have ever imagined,  get pre-qualified and start your homeownership journey today >

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