Jon, I am afraid I don't agree with the above paragraph. Property taxes and maintenance are certainly not the only expenses left after mortgage is paid off. The opportunity cost of money tied up in home equity can easily make home ownership more costly than renting.We all need a place to live and if you’re renting you’re still paying a mortgage: your landlord’s mortgage! Eventually, he or she has built up equity with your rent payments: you get to live there month by month but have nothing to show for it. In fact, the landlord will likely increase the rent each year to keep up with inflation.
Once you own a home and pay if off, your property taxes and maintenance expenses should come in at less than half what you’re paying out in rent. Of course, condos may also charge monthly maintenance fees.
The fastest route to a paid-for home is putting up a large down payment rather than take on the higher debt of a low-ratio mortgage. Once the emergency fund is established, keep maximizing contributions to the TFSA in order to accumulate a down payment for first home, preferably putting up 25% down payment.
For example, say I got $250,000 cash right now. I can either invest it in the stock market or I can buy a house using cash. With the stock market, I get dividends and capital gain. With the house, I get rent saved and home value appreciation. Therefore, home ownership should be evaluated just like a stock purchase. Let's say my monthly rent is $1500, that's $18,000 yearly. Property tax should be $2500 and maintenance is usually estimated as 1-2% of the home value, that's another $2500. The net rent saved is $13000, or 5.2% yield, which is good, but not spectacular considering that home appreciation are historically much slower than capital gain. In certain cities (like Toronto), the yield is probably even lower due to the unfavorable rent/price ratio.
Another issue with home ownership is living above one's need. Because home purchase is such a major investment, people tends to leave rooms for growth. For example, they will usually budget for future children, inlaw visitings, etc...., which means a couple can live in a 3-4 bedroom home unnecessarily. Thus causes significant drains on a family's finances.
I still think home ownership is not a bad investment, especially considering the favourable tax treatments. However, I don't think it's necessarily helpful for the road to financial independence.