Buying and selling homes has become very expensive, thanks to elevated house prices

A decade ago, Joe Bladek’s clients typically put down deposits of between $1,000 and $5,000 when making an offer on a new home. Today, the Barrie, Ont.-based mortgage broker said, those deposits are more commonly in the range of $5,000 to $10,000 – and recently, he worked on an offer where the buyer put down a $50,000 deposit and had to ask family for help to scrounge up the funds.

“A lot of clients don’t realize that deposits are quite large these days,” Mr. Bladek said. It’s partly owing to the higher cost of homes themselves, since deposits are typically between 1 to 10 per cent of the sale price. But it’s also a holdover from the pandemic bidding wars, when buyers sought to compete with firm offers. And while deposits come from the down payment, buyers need to have the money on hand.