While the cottage real estate market was hot over the summer, literally and figuratively, it’s expected to cool down in the coming fall months, according to Re/Max’s 2022 Fall Real Estate Market Outlook. But you can still expect a strong market, says Rick Laferriere, a Re/Max sales representative based in Barrie, Ont.
What buyers and sellers can expect for the fall 2022 cottage real estate market
Based on his observations, Laferriere notes that there are many buyers, but not enough properties. He estimates there’s been a 30 per cent drop in the number of available properties compared to the summer.
This means that for those looking to sell their cottages, Laferriere says you’re in a strong position to do so. Besides, spring and fall are prime months for selling; while owners typically devote other months to preparing their cottages for sale or rent. He recommends sellers work with a local real estate company familiar with the area’s values and prices. “If you overprice something in today’s market, it won’t sell.” Even if you’re not ready to sell this year, Laferriere recommends owners take photos of their cottages now against the fall foliage, rather than waiting until the winter months when their lawns are covered in ice or snow.
In May, Re/Max forecasted average cabin and cottage prices in recreational markets would rise by 20 per cent for the remainder of the year. The report found around 40 per cent of Canadians living in recreational markets, such as the Kawarthas and Southern Georgian Bay, are drawn to its affordable pricing. But the recreational market in other parts of Ontario could look different depending on how high interest rates go. (The Bank of Canada has one more policy rate announcement left in 2022 on December 7.)
The Muskoka cottage market is still hot, Peterborough cools off
There were two cottage-country areas of note in the fall Re/Max report: Muskoka remains an outlier and affordability has taken a hit in Peterborough. Muskoka region is still expected to experience a five per cent increase in average prices this fall. Over in Peterborough, interest rate hikes and mortgage stress tests may have finally put a damper on the market. The area is expected to see a seven per cent decrease in average sale price for residential and waterfront properties in the next few months.
Will cottage prices go down in Ontario?
If you’re in the market for a cottage, Laferriere says patience is key. With inventory low and prices high, it’ll take time to find a property that is in your price range and one that you actually like. According to Laferriere, a cottage on Lake Simcoe, Ont., costs an average of $1.9 million. “There hasn’t been much change in that price.” Even a waterfront condo in the Lake Simcoe area can cost an average of $790,000.
On the other hand, prices for cottages in areas with weeds or the water nearby is silty have dropped by about 20 per cent from the summer. “Don’t settle for something just because that’s what’s available on the market,” he adds.
Ultimately, the availability of properties can lead to major swings in the recreational market. Laferriere says availability can shift a buyer’s market to a seller’s market or a seller’s market to a buyer’s market.
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