The Muskoka region may finally be starting to stabilize after several years of high-demand and high-prices. Canadian Real Estate Association (CREA) data shows that the Lakelands region, which includes Muskoka, saw a 4.3 per cent year-over-year increase in listings in May 2023, when compared to May 2022.
This also translates to sales. CREA data shows that Lakelands saw a 6.1 per cent year-over-year increase in residential non-waterfront sales and a 0.7 per cent year-over-year increase in waterfront properties sales for May 2023.
Non-waterfront sales posted their “first year-over-year increase in exactly two years,” according to a Lakelands Association of Realtors press release.
Lakes of Muskoka Royal LePage real estate broker Susan Benson confirms the growing listings and sales in Muskoka real estate.
“The non-waterfront residential market is in a balanced market, while waterfront has moved into a buyers’ market,” she says. “The full effects of the latest interest rate hike have yet to be felt, but those rate hikes historically impact non-waterfront buyers more.”
Despite non-waterfront’s sales increasing, CREA reports a 6.1 per cent year-over-year median price decline. The May 2023 median price of a non-waterfront property was $695,000, whereas last year, the median price in May was $750,000.
Yet despite waterfront properties selling less, CREA reports a sales tag increase. Waterfront properties are going for a median price of $1,085,000 in May of this year, a 6.6 per cent year-over-year increase.
But Benson has seen a “significant number of price corrections” in June for waterfront properties. She’s starting to hear from buyers about why there was a flat growth of waterfront properties in May: buyers won’t purchase cottages for more than peak spring 2022 prices. That 6.6 per cent year-over-year increase in waterfront properties’ prices has deterred buyers, hence the need for the price corrections.
With rate hikes increasing mortgages, a recent release from CREA suggests that homeowners are hesitant to leave behind their fixed-rate mortgages and sell their homes. Yet CREA is reporting a 1.4 per cent year-over-year increase in home transactions in May. It may be small, but it’s the “first national year-over-year sales increase in almost two years (since June 2021).”
Like CREA, Benson remains optimistic for the future of the Muskoka real estate market.
“We anticipate a growing supply of listings into the fall,” Benson says. “And that prices will remain considerably higher than pre-pandemic levels, though in better alignment with current market conditions than spring listings have been.”