If you haven’t achieved your dreams of owning one home, you’ll definitely have to postpone your plans to own a second one as prices on recreational properties continue to soar.
In 2021, the price of recreational properties like cottages and trailers climbed by a whopping 34.6%, and now, according to the 2022 Royal LePage Recreation Property report, they’ll be increasing another 13.0%.
Demand far outstrips supply for recreational housing, which continues to be the main impetus behind the increases.
“Demand for recreational properties continues to vastly outstrip inventory in many cottage regions across the country. Waterfront and mountain-top locations near cities are limited by nature, even in a vast land like Canada, forcing buyers into multiple-offer scenarios,” President and CEO of Royal LePage Phil Soper said in a press release.
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Of the 151 Royal LePage recreational realtors surveyed for the report, 84% said that they are working with fewer available properties this year. Half of them said they had significantly fewer properties on the market.
Soper said that the COVID-19 pandemic encouraged people to look for larger properties or properties with more outdoor space.
“The desire for homes with more space, both indoors and out, is a trend that I believe will long outlive the pandemic,” he said. “Many Canadians, especially those with the option to continue working remotely, are prioritizing their desired lifestyle when considering where they want to live.”
Most recreational properties in Ontario are going for above asking. With the projected 13.0% rise in prices, Royal LePage is forecasting an average recreational property price of $737,890 in Ontario.
“Prior to the pandemic, an entry-level property in Muskoka would have cost about $400,000. Today, the same property would not go for less than six to seven hundred thousand, and you won’t find many listings like this today. Inventory is at an all-time low,” John O’Rourke, a broker with Royal LePage Lakes of Muskoka, said in a statement.
He added that more and more people are using those properties permanently as they stick with remote work. Most buyers in the Muskoka region come from the GTA and Golden Horseshoe areas.