The smart renter’s guide to how to save for a house in Canada
Saving for a house while renting can feel like an uphill battle. With monthly rent, utilities, and everyday expenses taking up a large portion of your income, setting aside money for a down payment (or even an investment property) might seem out of reach. Here’s the good news—regardless if you’re planning to buy your first home or invest in real estate, it’s absolutely possible to grow your savings while renting. The key is having a clear financial strategy and making smart money decisions that help you cut costs and maximize your savings over time.
In this guide, we’ll share practical, proven strategies to help you save money while renting—without sacrificing your quality of life. Between smart budgeting techniques and expense-cutting hacks, we’ll show you how to make your money work harder, so you can move closer to owning a home or expanding your investment portfolio.
Build a strong financial strategy
Before jumping into cost-cutting measures, it’s important to lay the foundation for a solid financial plan. A strong strategy makes sure you’re saving efficiently and making the most of your income while renting.
1. Set a clear savings goal
Start by determining how much you need for a down payment. In Canada, this depends on the home’s price:
🏡 5% for homes under $500,000
🏡 10% for homes between $500,000 and $999,999
🏡 20% for homes $1M+ (since mortgage insurance isn’t available)
Beyond the down payment, factor in closing costs, property taxes, and emergency savings to avoid surprises down the road. Online mortgage calculators can be helpful in setting a realistic savings target.
If you’re buying as an investment, research rental yields and expected returns to ensure your savings goal aligns with your long-term financial plans.
2. Create a realistic budget
A detailed budget is the secret to balancing rent, living expenses, and savings. The 50/30/20 rule is a great starting point:
50% – Essentials (rent, utilities, groceries)
30% – Wants (entertainment, dining out)
20% – Savings & debt repayment
Adjust these percentages based on your income and goals—if saving for a home is a priority, try shifting more towards the savings category.
3. Minimize debt and boost your credit score
A strong credit score helps you qualify for better mortgage rates when you’re ready to buy. To improve yours:
✅ Pay off high-interest debts first (like credit cards)
✅ Make bill payments on time to build a positive credit history
✅ Keep credit utilization low (ideally below 30% of your limit)
If you’re planning to buy an investment property, a good credit score can also help you secure financing with better terms.
Smart ways to save money while renting
Now that you have a solid financial strategy in place, it’s time to focus on practical ways to cut costs and maximize savings. Whether you’re aiming for homeownership or planning to invest in real estate, these strategies will help you build your savings faster.
Set up a dedicated house savings fund
Keeping your home savings separate from your everyday spending makes it easier to track progress and avoid dipping into it for non-essential expenses. Consider opening a high-interest savings account (HISA) or a tax-free savings account (TFSA) to grow your savings faster. Setting up automatic transfers to your savings fund every payday can make saving effortless. Even a small amount—like $100 biweekly—can add up significantly over time.
Track your expenses and cut unnecessary costs
Small daily expenses can add up quickly, making it harder to save. Take a close look at your spending and identify areas where you can cut back without sacrificing quality of life.
Some easy ways to reduce spending include:
- Cooking at home more often instead of dining out.
- Canceling unused subscriptions like streaming services or gym memberships.
- Switching to budget-friendly alternatives for groceries and utilities.
- Using budgeting apps like Mint, YNAB, or PocketGuard to track expenses.
By making small, consistent changes, you can redirect more money toward your savings goal.
Lower your rent or housing costs
If rent is taking up too much of your income, explore new ways to reduce it:
- Negotiate a lower rate with your landlord, especially if you’re a long-term tenant.
- Look for a more affordable rental in the same area or a nearby suburb.
- Get a roommate to share expenses and cut your rent in half.
- Check if landlords offer discounted rent in exchange for minor property management duties.
Even a small reduction in monthly rent can add up to thousands in savings over a year.
Be smart with household expenses
With the rising cost of living, many renters are feeling the pinch. But while some expenses are unavoidable, there are still ways to reduce household bills and free up more money for savings.
- Rethink your utility usage – Small changes, like turning off lights when leaving a room, using energy-efficient bulbs, and running appliances during off-peak hours, can lower your electricity bill.
- Be mindful of heating and water use – Sealing drafts, lowering the thermostat by a degree or two, and taking shorter showers can lead to noticeable savings.
- Cut down on internet and phone costs – Many people overpay for services they don’t fully use. Reviewing your plan and switching to a better deal can save hundreds per year.
By making a few adjustments, you can reduce overall expenses without sacrificing comfort, helping you attain your home ownership or investment goals faster.
Final thoughts
Saving for a house while renting isn’t easy, especially with the rising cost of living across Canada. Many renters feel like homeownership or property investment is out of reach, but we’re here to tell you that it’s still possible. If you’ve ever thought you’d never be able to afford a home, think again.
To get there, it’s all about small, strategic steps that build up over time. If you cut back where you can and stay committed to your savings goals, you’ll be surprised at how quickly things can change.
At Canopy Mgmt, we understand the challenges of juggling rent and long-term financial goals—especially in Canada’s ever-changing housing market—because we see them every day. But we also see success stories—renters who never thought they could own a home, now holding their keys. With the right approach, you can get there, too.
If you’re ready to start your journey, we’re here to help.
Contact us to learn how to save for a house
