First-time home buyers squeezed out of London market

With house prices soaring in London, Ont., like in so many other cities across Canada, first-time home buyers say finding a house to purchase has been a nightmare,and some are calling it quits on the hunt.

The average house price in London skyrocketed to $607,000 in January, with the median price landing at $560,000, according to the most recentreport from London St. Thomas Association of Realtors. The report also highlights that the number of houses available to buy has been declining.

Ahmed Bakare, an IT project manager,moved to London from Johannesburg three years ago, looking for a better life. Today, he and his wife want to buy a town home or a single detached house for themselves and their three-year-old son.

So far, they've put offers on seven houses. In every case, they offered at least $55,000 over asking.

"It's a nightmare," said Bakare.

Bakaremoved to London because it wasmore affordable than Toronto. What he and his wife, who is studying social work at WesternUniversity, didn't anticipate was just how expensive London would be.

"This was one of the main reasons why I chose London as my home city. I didn't figure that the housing market was going to be as competitive as it is right now," he said.

"The bidding war has been going crazy," said Bakare who lost his most recent bid on a town house even though he offered $60,000 above the asking price. That house sold for $585,000, or$185,000 over asking, he said.

Bakare said he'll continue making offers, and hope for the best.

Health care project manager Dawn Gosneyis also looking to buy her first home with her husband, a firefighter, and theirtoddler. They've been on the hunt since they moved back to London a few years ago, and have been through about 30 houses, though they've not made any offers.

"We had the goal of purchasing a house in 2021. And we mistakenly were hoping that this year was going to be an easier year to buy, and it's looking like it's going to be the opposite," Gosney said.

Gosney and her husband have been looking in different neighbourhoods for both condos or semi-detached houses, andslowly began ditching must-haves such a big yard, a garage, or two bathrooms.

"We just never got to the point where we loved aplace enough and felt that what thehouse was listed at and knowing how much we'd have to go over for, was worth it," she said.

A few weeks ago,Gosney and her husband decided to abandon the house hunt and will keep renting for a few more years.They'removing a bigger town house next month.

"We feel really good about it."

"We felt by having to offer $100,000or more over-asking for a house that'salready over-priced for what it was probably worth, just wasn't going to be a prudent financial decision, especially if there is any kind of an economic shift due to the pandemic recovery and whether there's ever a correction in the housing market," Gosney said.