The median price of recreational vacation homes in Canada has increased since the pandemic. Canadians are looking to spend more time outside and on the cottage. Nationwide lakefront properties are selling like well, water. There’s an exodus of people from Toronto and its increasingly costly housing market and moving to the surrounding suburbs, with property prices spiking to record highs in recent months.
With lakefront properties for single-family property sales in the median price sitting at $1 million dollars, all waterfront properties also saw a significant price difference nationwide and experts are likewise expecting cottage prices to increase by around 20 per cent overall, leaving few eligible markets in the province within the ideal budget of most people.
Strong buyer demand has been buoyed by low interest rates, a diminished supply of homes on the market and reluctance among homeowners to sell during a pandemic. Houses in the recreational regions of Ontario and Atlantic Canada are forecast to see the highest price appreciation in the country this year, set to increase 17 per cent, while prices in Quebec and British Columbia are forecast to increase 15 per cent and 13 per cent, respectively. According to a survey of Royal LePage recreational real estate professionals across the country, 91 per cent said that their market has less inventory than typical for their respective regions, including 72 per cent that reported significantly less inventory available.
But buyer demand has driven housing prices up considerably and now a new law Canada is proposing a 1% tax on underutilized or vacant real estate owned by foreigners, thereby potentially foisting thousands of dollars of annual costs on Americans and other foreigners who own properties north of the border that they haven’t been able to visit for more than a year because of the Covid-19 pandemic.
The tax, which would be implemented in 2022 if adopted as part of the Canadian budget for that year, is aimed largely at foreign investors who have been snapping up condos in Toronto and other booming Canadian cities. But cottage owners from the Buffalo area and others who own property in Canada are worried they will end up paying much more to own homes they can’t even use at this point.
Websites such as Dale Mundi help buyers find properties in the Toronto area, such as this sprawling waterfront home situated one hour away from Ottawa just sold for more than 1 million dollars over asking price. It did come equipped with some bougie perks amid its rather simple farmhouse style, including an indoor spa pool and a full inground swimming pool outside.
With five bedrooms and four bathrooms plus a bunkie, garage and barn on 20 acres with 1,500 square feet of waterfront, the $1,495,000 price tag may have been a bit of an undervaluation, even for a nearly 200-year-old house in the middle of nowhere.
