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Affordability factors into greater demand for recreational property in markets across the country this year, says RE/MAX
Sales of recreational product up in 70 per cent of Canadian markets examined.
Canadian
recreational property markets have been reinvigorated, with softer
values, increased selection, and a rebound in consumer confidence
contributing to an upswing in sales in 2012, according to a report
released today by RE/MAX.
Jun. 18, 2012
The RE/MAX Recreational Property Report, highlighting trends and
developments in 33 markets nationally, found that sales were ahead of
last year’s levels in 70 per cent of communities examined, while six per
cent were on par with 2011 figures. Greater affordability has been a
major impetus, in large part due to rising inventory levels and low
interest rates. Downward trending in starting prices was reported in 49
per cent of markets, while 33 per cent experienced no change. Nineteen
per cent posted an uptick in starting values year-over-year.*
“Recovery is still in its early stages, but there are subtle
differences on the recreational property front this year,” says Michael
Polzler, Executive Vice President, RE/MAX Ontario-Atlantic Canada. “The
gains are more widespread, affecting more markets and regions.
Affordability has provided some serious stimulus, but renewed consumer
confidence is the true driver. Buyers will simply not move forward if
any doubts exist—economic or otherwise. So the demonstration of
confidence we see today bodes well for the future.”
Inventory levels have climbed in virtually all centres, with some
shortages noted at entry-level price points. Activity is exceptionally
healthy for recreational properties under the $400,000 threshold, while
demand for luxury product over $1 million has also seen renewed interest
in several markets, particularly as values have moved more in line with
current conditions. The mild winter weather also brought purchasers out
earlier in the year in many parts of the country.
“While buyers are still cautious, they’re motivated,” says Elton Ash,
Regional Executive Vice President, RE/MAX of Western Canada. “Current
market conditions have placed them firmly in the driver’s seat. While
the more favourable climate has factored in, activity has also been
fuelled by pent-up demand that’s been building since 2008, when many
began waiting it out on the sidelines. Opportunity does exist. Canadians
love a good deal, and there’s no question that there are still some to
be had in recreational property markets across the country.”
The report found that the changing mix of purchasers has also had an
undeniable impact on the current momentum, particularly in Western
Canada. Activity among the baby boomer demographic over 60 has softened,
compared with years past. Enticing prices in the southern U.S. have
played a considerable role in rerouting purchases, but some retirees are
returning to their own backyard, as prices north of the border have
edged downward. Younger families and first-time buyers have stepped in
to fill the void in most markets.
Starter waterfront product (three-bedroom, winterized), priced under
$350,000, is now offered in 53.5 per cent of all recreational markets,
while 58 per cent of recreational centres offer entry-level properties
under $400,000—an improvement over 2011. Value markets were identified
as Atlantic Canada, the Laurentians and Eastern Townships in Quebec,
more than half of Ontario—inclusive of the coveted Muskokas—as well as
Lake Winnipeg, Canmore, Harrison Lake and Comox Valley/Mt. Washington in
Western Canada.
The mindset of this year’s buyer pool falls firmly into two
camps—those willing to compromise, buying back-row properties off the
water (happening in larger numbers—reflective of more young families
active at the entry-level), and those who are steadfast in their search
for the ideal location. While turnkey product is always the preference,
it’s rarely a deal breaker, as renovation activity abounds. Teardowns
and custom-builds are occurring where possible, but older, rustic
cottages and/or vacant waterfront lots, are becoming increasingly
scarce.
“The good news is that there is something for everyone,
regardless of budget, in Canadian recreational property markets,” says
Sylvain Dansereau, Executive Vice President, RE/MAX Québec. “The
challenge in the current climate is balancing expectations with market
realities—both on the part of the vendor and the purchaser. Yet, deals
are coming together, and the start to the season has been encouraging.
We’ve had false starts in the past, but this has the hallmarks of a
market with promising momentum.”
RE/MAX is Canada’s leading real estate organization with nearly
18,900 sales associates situated throughout its more than 720
independently-owned and operated offices in Canada. The RE/MAX network,
now in its 38th year, is a global real estate system operating in 87
countries, with close to 6,300 independently-owned offices and over
87,700 member sales associates. RE/MAX realtors lead the industry in
professional designations, experience and production while providing
real estate services in residential, commercial, referral, and asset
management. For more information, visit: www.remax.ca.
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For more information:
Christine Martysiewicz
RE/MAX Ontario-Atlantic Canada
905.542.2400 |
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