Think about what you want and be open to a wider range of possibilities.

Whether you are searching for a cabin, a cottage, or a camp, an affordable one is the holy grail of waterfront properties. Yet what’s affordable for one buyer may be beyond the budget of another. You may be prepared to pay more if the property has a beach or other kid-friendly waterfront; someone else may value the deep, cold water—and great fishing—of a lake on the Canadian Shield. A third cottager may care less about being right on the water than being close to a town or other attractions.

When it’s time to search for your dream cottage, keep in mind that a few general tenets hold true:

  1. Cottages close to larger cities—say, within one-and-a-half-hours’ drive—will cost more than more remote ones.
  2. A cottage in move-in condition will cost more than a fixer-upper.
  3. You will pay less for a water-access cottage (i.e., where you have to take a boat to get there) than one with road access (with one exception; see #4).
  4. A private island will be more expensive than a lot on a shared island. It may even be priced higher than an equivalent road-access property in the same area.
  5. Winterized cottages command higher prices than seasonal places.
  6. Cottages on rivers are typically less expensive than those on lakes.
  7. You will pay less for a cottage on a backlot (i.e., one or two streets away from the water) than for a waterfront property nearby.

What happens if you’ve considered all the options and you’re still short of cash? The good news is that numerous strategies exist for getting around the high cottage price tag. You will find them here, including ways to share a cottage with family members—or your best buds—and still remain on good terms.

Buy a fixer-upper

A renovation may be a cheaper option, but keep an eye on your costs.

You love the location. But the cottage needs some work. Maybe a reno will get you what you want? “You have to understand the extent of the renovation you’re planning,” says architect Christopher McCormack of McCormack Architects in Toronto. “If you’re significantly altering the building and it’s not of great emotional or historical value, you might be better off taking it down.”

And while you might think that a reno will save you big money, that isn’t necessarily so. “Renos typically have a cost factor of 1.5 times the cost of new construction,” says McCormack. If you’re renovating 40 per cent of your building, that will still work out to be cheaper than a new build. But if you’re renovating 80 per cent of your cottage, knocking it down and starting over could be more cost-effective and efficient. How do you know if it’s time for the wrecking ball? “If you’re converting an older cottage to a four-season home, and you’re going to be gutting it, putting in new windows, siding, and insulation, the only part of that building you’re saving is the cheapest part of it,” says Andrew Waddell, a contractor and the owner of Waddell Custom Homes in Apsley, Ont. “You’d be better off starting from scratch.” Still, there are disposal costs involved in tearing a structure down, and they can add up quickly, especially if the cottage is water access and barging is required—something you’ll want to factor into your decision.

So when should you opt to renovate? If you love the existing cottage and the changes you want to make are limited—say, a kitchen and bathroom redo, rather than a full-structure rebuild—renovating makes sense, says McCormack. Environmental factors may also come into play—it’s kinder to the planet to reuse than to build new—as can a remote location, where it may be easier to bring in what’s needed to renovate than it is to transport in what you’d need to rebuild.

Of course, in cottage country, there can be another significant advantage to renovating: existing structures may be grandfathered under newer building codes, meaning that your cottage or boathouse may be closer to the water or bigger than you’d be allowed to build if you were building new. Still, there may be restrictions. You may have to add onto the back of the cottage—away from the water—or face limits on adding to the width of the building or to its height with a second storey. Septic-field regulations may also limit the number of bedrooms or bathrooms you can add. (One suggestion from contractor Waddell: consider upgrading your septic system if you’re doing a reno anyway.)

While an escape from the burbs is what draws many cottagers to the country, make sure you play by cottage country’s reno and building rules to ensure that you maximize your enjoyment and minimize headaches now and in the future. —Kim Pittaway

Share a cottage

Pool your resources with family or friends to get into the market, but remember that every relationship has its compromises.

You can’t afford a cottage, and your friend (or brother or sister or whoever) is in the same boat. The solution couldn’t be more obvious, right? Go into it together, with your money and their money adding up to a bigger deposit and turning that potential cottage into a reality. This sounds like a win-win deal, until the morning after, when you realize that a shared purchase means shared responsibility, and that a bigger deposit could end up leading to bigger headaches down the road.

Nonetheless, more and more people are opting for sharing as a way to get into the cottage real estate market. It may seem obvious, but you really have to consider, before you get too far involved, who it is you’re joining forces with. It may be all laughs and giggles when you have dinner with your good pals once a month, but owning a property with them is an entirely different matter. How are they with finances: bills, mortgage payments, etc.? Are they handy when the inevitable small fix-it tasks come up? Are you certain you can spend a lot of time with them, or are you prepared to tell them that you want to keep your time at the cottage separate from theirs? And are you in agreement about these and countless other matters?

Before you even begin to look for a cottage with another party, you must first explore all the issues that may come up between co-owners. That’s where a sharing agreement comes into play. It’s in everyone’s best interests to agree beforehand on how to use the cottage, on divvying up duties and responsibilities, and on general practices. You can get as detailed as you want with your agreement, and remember to ask as many “what if” questions as you can think of (“what if one of us dies?”, “what if one of us remarries?”, “what if one of us gets transferred across the country?”, etc.).

For more on how to draft a sharing document, read this article by Peter Lillico, a lawyer who specializes in sharing agreements and succession plans. —Blair Eveleigh

Buy a fractional

Owning just a part of a cottage may give you more flexibility, but consider the restrictions.

Here’s how fractional ownership works: a development company or resort builds the cottage. The ownership is divided into shares. You buy a share, which gives you a deed to the property and access to it for a certain number of weeks per year. In Canada, each cottage is commonly divided into 10 shares, which means each share you buy entitles you to five weeks: one fixed week in the summer, and the other four spread throughout the year. Nine other owners also get their own five weeks and the leftover two weeks are for property maintenance. You pay an annual maintenance fee for cleaning and upkeep (indoors and out), utilities (electricity and phone), property taxes, insurance, and the services of a property manager. Fractional cottages are mainly found in British Columbia and Ontario, but you’ll also find them in Alberta, Manitoba, Nova Scotia, and Newfoundland and Labrador.

So, what are the pros and cons of owning a fractional?

It’s cheaper. Each share is usually under $150,000, some as low as $40,000, making it much more accessible to buyers, especially in premium areas.

It comes with perks. Some include access to resort-type amenities, such as a pool, boats, golf carts, a spa, and a fitness centre.

You own it. Unlike some timeshares where you buy the use of a property, your shares come with a deed and you own the actual real estate. “The fractional owner’s interest can be freely bought, sold, bequeathed, gifted, and foreclosed on, all without affecting the other owners,” says Jon Zwickel, the president and CEO of the Canadian Vacation Ownership Association, the industry group for vacation ownership like timeshares and fractionals. It may also be possible to exchange weeks with other owners—at your property, at another development, or even internationally.

It’s no-maintenance. Just show up with your clothes, food, beer, books, and board games.

And it’s low commitment. “We didn’t want to feel tied down,” says one owner, referring to the pressure many cottagers feel to use a property at every opportunity. “We would have felt guilty if it was lying empty most of the year.”

On the other hand…

It’s structured. Want to take an extra-long weekend, or spend your birthday at the cottage? The bottom line is you can’t use the place whenever you want.

It’s not mortgage friendly. “Financing can be very difficult. Traditional lenders have convinced themselves that the asset is risky because of the shared ownership,” notes Zwickel. “Many people finance through a personal line of credit.” Also, remember that the annual fees can easily go up, depending on maintenance issues, property tax increases, utility costs, and the like.

It’s not your place once you leave. You have to clear out your stuff at the end of your week, as you would with a rental property. (Some developments have storage lockers.) You can even be fined if it takes the housekeeping crew longer than a designated time to clean up.

It comes with rules. Read the homeowners’ association bylaws before you buy. There will be restrictions on smoking. Some fractionals are pet-free. No redecorating, no repainting, and no marking the kids’ heights on the door frame.

If you decide a fractional is the right option for you, you still have to do your due diligence. Use a real estate lawyer who has experience in this field, have a title search done, and have a clear understanding of the paperwork. —Bonnie Schiedel

Province-hop

A faraway place may be the solution for you, but factor in travel costs and the time commitment.

When it comes to buying out of province, realtors are noticing the trend. “I deal with a lot of people who are either selling their big home in Alberta or their family farm in Ontario, and are looking to buy here and still have a nest egg to retire on,” says Gabe Routhier of Tradewinds Realty in Hubbards, N.S. Some are buying traditional homes to use as recreational properties—“Out here, really every property can be used as a recreational property, because you’re near the ocean,” he says—while others are purchasing actual cottages.

If you are province-hopping, you may want to keep your home address under your hat so that sellers don’t assume that you’ve got bags of out-of-province loot in the trunk of your car. As well, don’t assume that every property is a bargain just because it would be more expensive closer to home: take the time to research areas and prices so that your offer is in line with local property values. —Kim Pittaway

Buy at a tax sale

Do your homework before you try this option; you can get a deal, but watch out for pitfalls.

There’s a way to nab yourself some waterfront property for cheap, though cheap don’t come easy. When an owner falls behind on property taxes, a municipality can eventually sell the property to recoup the debt, often at well below market price. The rules and frequency of these sales—usually posted on the municipality’s website—vary from province to province and municipality to municipality. Generally, on the tax sale date, interested buyers submit a “bid” or “tender” and the highest bid wins. The winner must leave a deposit in cash or certified funds and has anywhere from a few days to a couple of weeks to pay the balance, or risk losing the deposit.

That’s the theory, anyway. In practice, the property list usually dwindles by the sale date, as owners face the music and pay their back taxes. It’s not uncommon for a list to drop from 300 properties to 11 in the four-month notice period. Other pitfalls: neither the bureaucrats nor potential buyers can gain access to inspect the property before the sale. Even after the sale, in Nova Scotia, for example (similar rules may apply in other parts of the country), if taxes have been in arrears for less than six years, the original property owner has six months to pay the outstanding taxes and redeem the property. (Winning tax sale bidders do get their money back plus interest.) And, if there are tenants in the premises, evicting them is not allowed. Sometimes, if it’s a “redeemable” property (that is, the owner still has the option of paying off the outstanding taxes), the owner can occupy the property until the closing date—so you can’t be sure what condition it will be in if and when it does close. “It’s very rare that tax sales complete,”  says Ozzie Jurock, a Vancouver-based real estate advisor. “But as long as you go in knowing this, and you have patience to play the game, there are deals to be had. —Josey Vogels

Look in fall

Shopping in fall has its advantages, but remember that this trend has caught on, and you’ll be competing against many other bargain hunters.

Fall can be a good time to buy. “The season’s over and the seller might be more motivated to unload the cottage because they don’t want to carry it through the winter,” says Christine Martysiewicz of Re/Max Ontario-Atlantic Canada. But is the price low enough to compensate for the fact that you’ll be paying for those costs for those first six to eight months, when you likely won’t get much use from the property? “If there’s a lot of available product in the area, you have the luxury of saying ‘We’ll wait until spring, and if it’s still there, we’ll buy it. If not, there will be other properties to consider,’ ” says Martysiewicz.

There are reasons besides price to look in fall, though, says Haliburton broker Anthony vanLieshout of Royal LePage Lakes of Haliburton. “I’ve always felt that fall’s the best time to buy,” he says. Many of the lakes in his area are reservoir lakes, where water levels drop two to nine feet in the fall. “You’ll get to see the shoreline at its most visible, and see what the low water level is like. And with the foliage coming off the trees, you’ll see the cottage’s privacy level when it’s at its worst.”

Land O’ Lakes broker Chris Winney of Royal LePage ProAlliance Realty tips towards spring. “It’s wet,” she says. “In my experience, water is one of the worst enemies of a cottage, and in spring, you’ll get a good sense of how dry the cottage stays.” You’ll also see how water-laden the ground itself gets.

And what about winter bargain hunters? “I get nervous when people buy in winter,” says Winney. “You can’t see the shoreline, and unless you or the agent knows the property or has good photos of the shoreline, it’s hard to know what you’re getting. —Kim Pittaway

Illustrations by Ray Fenwick