Getaway envy
Cottage sales expected to pick up speed
A wicked winter followed by a soggy spring may have put a damper on cottage sales for the second year in a row, but there is hope on the horizon: sunshine.
With school out and summer vacations about to kick into full gear, realtors who specialize in recreational properties say they are finally seeing a return to the lake. They expect to see the delayed season for sales simply extend into the late fall this year, just like it did last — assuming summer is finally here to stay.
“As I’ve been telling my sellers, ‘Nobody buys an air conditioner in winter; they buy when it’s hot,’ ” says Parry Sound, Ont., realtor Jim Marshall.
“Weather has a huge impact on this industry. We didn’t really get any traction until almost Canada Day, but I’ve done five deals in the last week and a half.”
Some regions of the country are now seeing “a rush of activity as buyers make up for lost time,” said Royal LePage in its recent Recreational Property Report for 2015.
The only notable exceptions when it comes to discretionary cottage sales, it says, are Alberta, some eastern border areas of B.C. and Newfoundland, “where a depressed energy sector has reduced activity levels and put downward pressure on prices.”
“In a roundabout way, the fall in oil prices is supporting the recreational property market this year,” Royal LePage president Phil Soper says.
“Cheaper gasoline makes the prospect of a weekend commute to the lake a more affordable proposition. And cheap oil means a lower Canadian dollar, which has more people looking at Muskoka, (Quebec’s) Tremblant and the B.C. interior, and fewer casting covetous glances at Florida and Arizona,” he adds.
The dollar is having an impact on the sun-and-sand sector in another way, notes major real-estate chain Re/Max in its annual Recreational Property Report.
“Canadians are choosing to stay in Canada where their dollar will go further,” the report states.
“Some are selling U.S. properties that appreciated in recent years to take advantage of the exchange rate.”
While conditions obviously vary across the country and the province — Muskoka, for instance, has seen a dramatic uptick in demand for properties $2 millionplus, largely from the growing ranks of the world’s wealthy — cottages remain a bellwether, of sorts, of a region’s economic health.
Price growth has been largely flat since the 2008 recession.
Marshall says much of his office’s business in the Parry Sound—Muskoka area used to come from families living in the GTA.
Now, he believes, many are so tapped out by escalating house prices that more cottage-country demand is coming for “peripheral people”: young families and retiring baby boomers who have homes in more affordable areas of Ontario such as Milton, Hamilton, Georgetown and Orangeville.
Supply remains in line with demand, says Rick Laferriere, a realtor who specializes in Lake Simcoe, where there are now 68 properties for sale and there have been 30 sales since the beginning of 2015. That’s in line with the 64 waterfront properties that sold in 2014, at a median price of about $815,000.
“The distance factor is key: to be 45 minutes from Toronto,” says Laferriere. “I think we’re going to do more than last year in numbers based on what I’m seeing now. It’s run, run, run.”
Much of the demand is for “big family cottages” that can be used year-round and as workplaces away from the city.
“Some American buyers are back with the dollar being the way it is.”
Veteran realtor Anita Latner anticipates there could be some pickup in sales in her Muskoka Lakes area as uncertainty in Greece plays its way out in jittery stock markets.
“I’m seeing more people buying cottages to rent or flip or commercial properties as long-term investments. Muskoka is secure; as secure as you can get.
“I think there will always be demand. Buying a cottage isn’t about age, it’s about who has money.”