Warmer Weather Spurs Rise in Recreational Property Sales Across Canada
2014 Recreational Property Report from Royal LePage confirms pent-up demand following harsh winter and delayed spring
Toronto, ON, June 5, 2014 – After a slow start to the year, sales activity in Canada’s recreational property market is beginning to pick up, according to the 2014 Royal LePage Recreational Report released today. A long and severe winter delayed the traditional spring buying season, but the arrival of waterfront-friendly weather has increased interest, is generating higher inventory levels and is driving sales activity.
The Royal LePage Recreational Property Report compiles information from a cross-Canada survey of brokers and agents who specialize in the recreational real estate market. Advisors across the country are reporting a significant increase in buyer interest and are anticipating the return of a healthy market for the remainder of the spring and summer. In many areas, snow remained well into the spring, hampering efforts to open and list summer properties, but sellers and buyers returned following the Victoria Day long weekend.
“In the middle of the last decade, we saw record levels of sales activity in the recreational property market, driven largely by the retirement dreams of our Boomer generation. The subsequent economic downturn dampened demand in the sector,” observed Phil Soper, president and chief executive of Royal LePage Real Estate Services. “Post-recession, our research found that incremental sales were driven largely by low interest rates and investors. With the 2014 market, we are seeing a return to primarily lifestyle-driven demand for cottages, cabins and chalets. Canadians continue to seek the opportunity to escape to a weekend retreat.”
“Economic factors such as a stable job market, inexpensive mortgage financing and steadily improving consumer confidence remain supportive for purchasers considering recreational properties,” continued Soper. “Many Canadians dream of owning a country retreat to get away from the pressures of life in the city and the daily grind. The pursuit of a place to gather with family and friends is a notion that seems to be more attractive now than ever.”
“Sharp rises in the price of recreational properties in U.S. regions favoured by Canadians, such as Arizona, Florida and California, coupled with a lower Canadian dollar relative to the American currency, is beginning to impact our domestic recreational market,” concluded Soper. “People who were previously wooed by bargain shopping for real estate south of the border are finding the real deals are now at home.”
According to the report, most regions in Canada are anticipating strong levels of buying this year despite the delay caused by the extended winter. The higher-priced end of the market, predominantly consisting of waterfront properties, is seeing healthy price growth in Ontario, Manitoba and Saskatchewan. At the lower end of the price range, there are particularly good deals on in-land properties in Prince Edward Island, New Brunswick, Nova Scotia and some interior regions of British Columbia.
In the most recent past, lower interest rates created a demand for cottages as investments, but that appears to be shifting back to more traditional values of owning a recreational property as a long-term lifestyle option. In Newfoundland, for example, there is an increasing trend of families purchasing summer cottages over traveling off the island for vacation. However, in the west in Alberta’s Gleniffer Lake and Pine Lake regions and the East Kootenays of British Columbia, properties are still popular purchases by groups of friends and families for shared-use or investments. Additionally, while properties on or near ski resorts and hills are seen as great places to both invest and enjoy, with owners often generating rental revenue, buyers in the west tend to keep their lakefront homes for their own use.
With so many options in recreational properties across Canada that include access to lakes, rivers, oceans and tidal waters, real estate professionals recommend that buyers carefully consider the specific type of property they pursue. For example, the nature of water they locate near, and the method of access can greatly influence pricing and availability, as well as the water-related activities that are possible when visiting. As well, some agents noted that even though most people begin their property search making proximity to their primary residence a top must-have, once buyers weigh questions of affordability and find their dream location, distance becomes a relatively less-important factor.
The Royal LePage Recreational Report is an annual market analysis of recreational property prices, trends and activity in selected leisure markets across the country.
The chart below shows the typical price range for standard in-land and waterfront properties across Canada in 2014.
2014 Recreational Property Price Summary
AVERAGE PRICE RANGE 2014
|Prince Edward Island
$140,000 – $175,000
$200,000 – $350,000
$30,000 – $180,000
$175,000 – $400,000
$100,000 – $1,000,000
$80,000 – $2,450,000
$100,000 – $400,000
$200,000 – $550,000
$149,000 – $1,500,000
$100,000 – $1,000,000
$129,400 – $800,500
About Royal LePage
Serving Canadians since 1913, Royal LePage is the country’s leading provider of services to real estate brokerages, with a network of over 15,000 real estate professionals in over 600 locations nationwide. Royal LePage is the only Canadian real estate company to have its own charitable foundation, the Royal LePage Shelter Foundation, dedicated to supporting women’s and children’s shelters and educational programs aimed at ending domestic violence. Royal LePage is a Brookfield Real Estate Services Inc. company, a TSX-listed corporation trading under the symbol TSX:BRE.
For more information, visit www.royallepage.ca.
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