A recent study on homebuyer searches shows that the average Canadian home-seeker is searching for homes that are way below average in terms of pricing, with expectations not matching up with the reality of the turbulent housing market.
After analyzing 5 million searches conducted this year on the real estate marketplace Point2Homes.com, the study found that the price range most searched for by homebuyers was between $200,000 and $300,000, less than half the latest national average home price of $640,000.
Tim Hill, a real estate advisor at RE/MAX who works in the Lower Mainland, said a detached house for the price of $200,000 to $300,000 does not exist.
Results of the study point to a profile of the average Canadian home-seeker that is between 25 and 34 years old, looking for a house of 1,000 to 2,000 square feet, priced between $200,000 and $300,000 and ideally with a garage and a waterview, says Alexandra Ciuntu, a co-author of the study.
She says that many home-seekers are looking for a “unicorn of a home.”
“That’s despite the fact that a reasonably priced 2,000-square-feet waterfront home in major Canadian cities is the definition of wishful thinking,” she said.
“Regardless of budget, it’s in the buyer’s nature to explore more economical alternatives before setting a realistic limit. For instance, first-time homebuyers trying to get a foot on the property ladder are thought more prone to weigh in cheaper options before reaching such a momentous decision for the first time in their life.”
Many homebuyers may also be looking for homes priced below the national average because they are hoping for a cooldown, as well as taking the pulse of the market, Ciuntu says.
“The more recent declining home prices don’t necessarily mean they can look forward to cheaper options, with some experts believing the cooldown might not improve housing affordability and could end up hurting the economy,” she said.
The majority of home-seekers in 2022, 62 per cent, prioritized searches for a detached house, compared with 14 per cent of searches aimed at condos.
Ciuntu says this is indicative of the post-pandemic need for space which has been a driving factor in the market the last couple years.
Though the majority of B.C. home-seekers are looking for a house, data shows that unlike other provinces, there is still substantial interest in other property types. Among the cities analyzed, Burnaby was the exception, with 60 per cent of home-seekers looking for condos. Richmond and Surrey also saw higher than average numbers, with 47 and 39.5 per cent, respectively, of home-seekers favouring condos in their searches.
“Burnaby is an expensive city. I would agree that especially first time buyers are purchasing condos there. I know my transactions in Burnaby have been primarily condos, especially on the purchase side,” Hill said
The farther away you are from urban centres like Vancouver, the more likely it is that you will be looking for a detached house rather than a condo, according to Hill.
