Buyers looking for permanent homes outside of unaffordable big cities are driving up demand for recreational properties from coast to coast. Prices are anticipated to rise up to 20 per cent in those markets over the course of 2022, according to new data from RE/MAX Canada realtors and brokers.
This migration trend is likely to continue this year. A Leger survey conducted on behalf of RE/MAX Canada found that 24 per cent of Canadians who live in a large urban city would like to purchase a recreational property within the next two years.
Most residents who already live in these leisurely places intend to stay and are happy with their quality of life. In the survey, people said they appreciate the low-density feel and love the affordability factor and access to water and outdoor activities. But 54 per cent are concerned over the growing population and what that means for community charm and liveability, with 41 per cent also worried about future affordability.
“Throughout the pandemic, we saw a shift in consumer behaviour, where in many cases liveability and affordability trumped all other factors,” said Christopher Alexander, president of RE/MAX Canada. “Yet, many recreational properties, whether as a primary or secondary residence, afford buyers the best of both worlds, compelling Canadians to settle in these areas for the long term. This is putting upward pressure on these markets.”
Young couples and families, retirees, out-of-town buyers and investors are driving these sales. According to the brokers and agents surveyed, waterfront properties with open space living and large acreage are in greatest demand.
“Historically, recreational properties are held within and passed down through families, which has been a strong contributor to low inventory in those markets,” says Elton Ash, executive vice president, RE/MAX Canada. “With the prospect of declining affordability for many homebuyers across the country, more and more Canadians are choosing to live in recreational areas because of the relative affordability they offer.
“In many cases, this has resulted in heightened demand for homes in regions that were already experiencing low supply, and could soon be facing more acute challenges of a growing population.”
Markets such as Kenora/Lake-Of-The-Woods and Greater Sudbury/Manitoulin Island experienced exponential year-over-year price appreciation of 339.72 per cent and 116.73 per cent, respectively. These areas are expected to remain accessible for many looking to enter the housing market.
Here’s a look at what brokers and agents are seeing in their local markets and what they see on the horizon of 2022.
Atlantic Canada
Out-of-province buyers are expected to keep snapping up recreational properties in Atlantic Canada. As governments encourage local migration to the area, new immigrants will join the market.
Markets sitting in seller’s territory are Truro, NS, Charlottetown, PEI, Summerside, PEI, St. John’s, NL, Moncton, NB and Halifax, NS. Only Sydney is a buyer’s market. This trend can be attributed to the supply-demand imbalance that brokers expect to continue through the remainder of 2022. Average recreational property price increases are expected to increase highest in Truro and Halifax.
Out-of-province buyers are settling into the area for the long-term and are leading market activity in Atlantic Canada among other stakeholders, with waterfront properties being most sought after by consumers.
Between January and March of 2022, year-over-year average residential sale prices have increased by 46 per cent in Truro; 22 per cent in Sydney; 18 per cent in Charlottetown; 20 per cent in Summerside; 38 per cent in Moncton; and 26 per cent in Halifax, NS. The only region that experienced a decrease in year-over-year average residential price was St. John’s, which declined by approximately seven per cent.
Ontario
Residential sale prices in recreational markets are expected to grow by 10 per cent in Windsor-Essex; five per cent in Kenora and Lake-Of-The-Woods; five per cent in Greater Sudbury and Manitoulin Island; nine per cent in Southern Georgian Bay; 18 per cent in Muskoka; and eight per cent in Rideau Lakes.
Orillia is expected to cool slightly, with a 10-per-cent decline anticipated through the end of 2022, compared to the 34.5-per-cent price growth experienced in the first quarter of the year.
Ontario recreational market activity is coming from out-of-province buyers, singles, millennials, retirees, families and young couples.
Investors are also showing particular interest in waterfront properties. Brokers in Windsor-Essex, Peterborough & Kawartha Lakes, Southern Georgian Bay and Orillia are reporting them as primary players in their regions. Despite accelerated buying activity in the wake of the pandemic – particularly by Southern Ontarians – some markets such as Kenora/Lake-Of-The-Woods are expected to regain balance in the remainder of 2022, as Canadians return to the office and activity wanes in some markets.
Western Canada
Western Canada’s recreational markets are all skewed toward sellers, including British Columbia’s Tofino, Ucluelet, Whistler and Penticton/South Okanagan regions, as well as Canmore, Alberta.
Demand in these areas has continued to thrive. Recreational properties for sale In Whistler and Canmore are receiving multiple offers amidst dismal inventory.
Canadians as shifting attitudes and high gas prices are prompting many to vacation closer to home. Average sale prices are estimated to increase by five per cent in Tofino, Ucluelet, Penticton/South Okanagan and Canmore in the remainder of 2022.
The full report, Cabin and Cottage Trends Across Canada (2022), can be found here.
