Home buyers may have big aspirations and bank balances but they are still coming up short when it comes to making bids.
While most home buyers expect to pay the big price tags in urban markets, their level of market expectation is still far removed from reality.
According to the latest Bank of Montreal Fall Home-Buying report, four in 10 potential homebuyers can expect to pay a whopping $83,556 (21 per cent) more than what they had initially planned.
Naturally, buyers in tight urban markets have to pay the higher price. A majority of those surveyed from Toronto planned to spend about $630,000, have to increase that figure by an average of $100,000 to get their desired property.
Buyers, however, have become more accepting of the fact that they will have to pay top dollar with eight in ten of those surveyed saying they now have a better understanding of current prices. They are also changing their buying strategy to suit their strategy.
“By shifting toward semis and townhomes and away from detached and condos, buyers appear to want their cake and eat it too - a backyard for the kids to play in, but also something that won't break the budget, notably in Vancouver and Toronto," said Sal Guatieri, Senior Economist, BMO Capital Markets.
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