The Cottage Country Boom
The overall Canadian real estate market was hot again in May and June, with sales activity up 256% year-over-year and prices gaining 2.4% from the previous month.
Even more shocking are the trends transpiring within the Ontario cottage country real estate market including Muskoka and Muskoka Lakes. During the pandemic, the number of people leaving major urban centres in favour of more rural communities has seriously changed the game. A blend of historically low interest rates, limited inventory and strengthening demand for homes in rural communities has put pressure on these markets.
So… you may be asking, what does the Ontario cottage country real estate market actually look like today in popular hotspots such as Kawartha Lakes or Muskoka? Here is a snapshot of the real estate activity unfolding in the Ontario cottage country markets, as reported by the CREA:
Kawartha Lakes (April / YoY)
Residential Sales: +273.7%
Single-Family Benchmark Price: +50.5% to $591,200
Muskoka (April / YoY)
Residential Sales: +240.5%
Median Price: +52.9% to $625,000
Haliburton (April / YoY)
Residential Sales: +237.5%
Median Price: +77.4% to $510,000
Why Is This Happening?
At first, it might be perplexing. Why would the broader Ontario real estate market be booming in an economic downturn, while tens of thousands are out of work?
The experts suggests a few of the main reasons are:
- Families from large cities are using the massive profits from their houses or condos as leverage in bidding wars to prop up prices and secure the property in rural areas.
- Record-low rates allows homebuyers to borrow more, giving them more purchasing power and more options.
- The sudden influx of homebuyers flooding the market dried up housing stocks, and supply has yet to catch up.
Now What?
Even with vaccinations broadening and Ontario’s Re-opening plan headed into Phase 3, it’s expected that the majority of Canadian housing markets will sit in seller’s market territory well into 2021. This is great news if you already own a home or cottage in Muskoka and are considering selling it, you stand to make a substantial return on your investment with the right guidance. Connect with us to understand exactly how you can maximize your position in this high-demand market.
On the other hand, if you have your sights set on buying a home or cottage this year, it is still possible! We have been starting to see a new trend in the last few weeks regarding the residential real estate market. Buyers are backing off due to frustration and inventory is on the rise making it more of a balanced market than it's been in quite some time. Sellers are starting to reduce their prices in order to re-engage buyers.
Whether you are a buyer or a seller, if you have questions about this booming cottage country real estate market we encourage you to contact us, we would be happy to help you!
- Dolf and Anzie Witlox
Dolf - 705.787.6196
Anzie - 705.571.0587
Statistics from: www.blog.remax.ca
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