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Press Release: RE/MAX Ontario-Atlantic Canada; RE/MAX of Western Canada
May 18, 2004
MISSISSAUGA, ON -- The threat of higher interest rates has shifted recreational property purchasers into overdrive
in major Canadian centres, according to the RE/MAX Recreational Property Report released today. For a copy of the
Recreational Property Report 2004, please navigate to http://files.newswire.ca/348/REMAX.pdf
Spurred by historically low interest rates, investment potential and family lifestyle, Canadians, Americans, and
Europeans are entering the market for recreational properties "like never before." However, in virtually
every market surveyed by RE/MAX of Western Canada and RE/MAX Ontario-Atlantic Canada, limited inventory levels
have translated into serious upward pressure on recreational property values.
"The level of demand we are experiencing is unprecedented," says Elton Ash, Vice President, Regional
Director, RE/MAX of Western Canada. "Finding the ideal property may prove to be a challenge in 2004. Waterfront
listings, in particular, have become a scarce yet highly sought-after commodity. Nonetheless, buyers remain grounded
in their search for the perfect property, refusing to pay more than fair market value. There have been some isolated
instances in which properties have sold for an inflated amount, but that has been the exception, rather than the
rule."
Demand is expected to outpace supply across the country this year, despite an anticipated influx of listings in
the weeks ahead. Out of 49 markets surveyed, 83 per cent reported a severe lack of inventory, especially in affordable
price ranges. Baby boomers once again lead the charge for recreational properties, driving activity in the vast
majority of Canadian markets. The youngest boomers are buying with their young families in mind while the oldest,
who are now approaching 58 years of age, are securing future positions-with plans for retirement being front and
centre.
Of all types of recreational property, the greatest price increases have occurred for quality waterfront properties.
Only 32 per cent of markets surveyed offer waterfront properties priced at $200,000 or less. Only one market, Newfoundland
East, offered properties under $100,000. By far the most expensive waterfront markets were found in Salt Spring
Island, Vernon, Muskoka, Penticton and the Sunshine Coast--where starting prices exceeded $500,000--and Wasaga
Beach.
"The waterfront is becoming an exclusive retreat for affluent purchasers," says Michael Polzler, Executive
Vice President, RE/MAX Ontario- Atlantic Canada. "Purchasers of more modest means will have to compromise
to realize their goal of ownership. For some, that will mean traveling longer and further to their ultimate destination.
For others, expectations may have to be pared down to include smaller lakes, rivers, channels, islands, leased-land,
fractional ownership, and back lot properties."
Affordability and limited inventory levels have created increased demand for less traditional recreational properties.
In many markets, farms and acreage sales are on the upswing. Also growing in popularity are leased-land properties.
In many cases, purchasers are permitted to tear down and build on the land, with leases of up to 99 years.
Condominium sales and prices are also increasing across the country. Providing a mix of entry-level and luxury
product to suit every budget, these properties often boast waterfront or water views. The only exception is Mt.
Tremblant, Quebec, where condominium sales are at a standstill due to a significant oversupply of product. Prices
may experience some softening this year as a result.
2004 is expected to be the strongest on record in many recreational property markets surveyed. Prices are expected
to continue the upward momentum from coast to coast. In most markets, vendors can expect top dollar, quick sales,
and in some cases, multiple offer situations--if the property is priced at fair market value.
Highlights - Locals are competing with recreational property purchasers for residential homes, driving up prices across the board. A shortage of available waterfront and back lot properties has placed upward pressure on rural residential markets -- creating an affordability issue for local purchasers. - Canadian residential real estate represents great value to American and European purchasers, particularly in Muskoka, Banff/Canmore, Sun Peaks, and the Okanagan Valley, Newfoundland, Shediac Bay, and Summerside. Given current property values in prime international recreational destinations such as Cape Cod, Nantucket, the Hamptons, Aspen, and Vail, many of these Canadian markets are undervalued. - The challenge facing Realtors(R) is coming up with available product. While some sales associates are canvassing cottage country for additional listings, others have turned to the land registry for leads. Purchasers are doing their part by placing their names on waiting lists. - Tear down and renovation activity continues unabated. With location, location, location coveted, and waterfront in short supply, many purchasers are buying property with little concern for the existing structure. In many areas, land often outpaces the value of the existing cottage/home. As a result, seasonal properties are virtually disappearing from the landscape in some markets. - Several markets still offer an affordable selection of recreational product, with a three-bedroom winterized waterfront property starting under $150,000. Those markets included: St. John's, Trinity and Bonavista, NF ($69,000); Interlake Region, MB ($100,000); Pembroke, ON ($110,000); Summerside, PEI ($125,000 +); Kingston, ON ($140,000); Elliot Lake, ON and West of Edmonton, AB at $150,000 respectively.
RE/MAX is Canada's leading real estate organization with over 12,500 sales associates in more than 600 independently-owned
offices. The RE/MAX franchise network, now in its 31st year of consecutive growth, is a global real estate system
operating in 47 countries. More than 4,850 independently-owned offices engage 90,400 member sales associates who
lead the industry in professional designations, experience and production while providing real estate services
in residential, commercial, referral, relocation and asset management. For more information, visit: www.remax.ca.
STARTING PRICES FOR RECREATIONAL PROPERTIES(x) ------------------------------------------------------------------------- Market 2002 2003 2004 ------------------------------------------------------------------------- Newfoundland - St.John's, Trinity, Bonavista N/A N/A $69,000 ------------------------------------------------------------------------- Corner Brook, Springdale N/A N/A $400,000 ------------------------------------------------------------------------- ------------------------------------------------------------------------- New Brunswick - Shediac Bay(xx) $150,000 $150,000 - $225,000 - $155,000 $300,000 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Prince Edward Island - South Shore, North Shore(xx) $60,000 - $80,000 - $200,000 $70,000 $150,000 ------------------------------------------------------------------------- Summerside (xx) N/A N/A $125,000+ ------------------------------------------------------------------------- ------------------------------------------------------------------------- Nova Scotia - South Shore, Lunenberg County(xx) $130,000 - $175,000 - $175,000 - $150,000 $250,000 $250,000 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Quebec - Mt. Tremblant $300,000 $300,000 $350,000 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Ontario - Lake Huron: Grand Bend $250,000 $270,000 $350,000 ------------------------------------------------------------------------- Sauble Beach $175,000 $225,000 $250,000 ------------------------------------------------------------------------- Bruce Peninsula $100,000 $175,000+ $275,000+ ------------------------------------------------------------------------- Parry Sound $130,000 $140,000 $150,000 - $160,000 ------------------------------------------------------------------------- Elliott Lake N/A N/A $150,000 ------------------------------------------------------------------------- Muskoka: Bracebridge, Gravenhurst $200,000 $200,000 - $350,000 $260,000 ------------------------------------------------------------------------- Port Carling, Bala $450,000 $450,000 $500,000 - $550,000 ------------------------------------------------------------------------- Huntsville, Lake of Bays $200,000 $200,000 - $250,000 - $400,000 $400,000 ------------------------------------------------------------------------- Haliburton $160,000 - $160,000 - $200,000 $200,000 $200,000 ------------------------------------------------------------------------- Bancroft $130,000 $150,000 - $220,000 $200,000 ------------------------------------------------------------------------- Flesherton $150,000 $180,000 - $250,000 $190,000 ------------------------------------------------------------------------- Georgian Bay: Midland $225,000 $275,000 - $275,000 - $300,000 $300,000 ------------------------------------------------------------------------- Honey Harbour, $250,000 $300,000 - $300,000 Port Severn $350,000 ------------------------------------------------------------------------- Collingwood $385,000 $385,000 $400,000 + ------------------------------------------------------------------------- Wasaga Beach $320,000 $350,000 $500,000 ------------------------------------------------------------------------- Orillia, Lake Couchiching $225,000 $275,000 $300,000 ------------------------------------------------------------------------- Lake Simcoe: Innisfil to Oro $290,000 - $320,000 - $390,000 - $320,000 $340,000 $450,000 ------------------------------------------------------------------------- Jackson's Point $225,000 $265,000 $280,000 and Area ------------------------------------------------------------------------- Beaverton $225,000 $250,000 - $300,000 $300,000 ------------------------------------------------------------------------- East Kawarthas - Chemong, Pigeon, $175,000 $180,000 $250,000 Stoney, Jacks, and Buckhorn Lake ------------------------------------------------------------------------- West Kawarthas - Balsam, Sturgeon, $250,000 - $250,000 - $220,000 Shadow Lake System, $300,000 $300,000 Head Lake, Four Mile Lake, and Burnt River ------------------------------------------------------------------------- Prince Edward County N/A N/A $200,000 ------------------------------------------------------------------------- Kingston $100,000 $130,000 $140,000 ------------------------------------------------------------------------- Perth $180,000 $180,000 - $160,000 - $260,000 $260,000 ------------------------------------------------------------------------- Pembroke $90,000 $93,000 $110,000 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Manitoba - Winnipeg and Area $125,000 $170,000 $300,000 - $400,000 ------------------------------------------------------------------------- Interlake Region N/A N/A $100,000 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Saskatchewan - Prince Albert N/A N/A $200,000 (Northcentral Saskatchewan) ------------------------------------------------------------------------- North Battleford N/A N/A $200,000 - (Northwest Saskatchewan) $300,000 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Alberta - West of Edmonton N/A N/A $150,000 ------------------------------------------------------------------------- Lakeland Region N/A N/A $165,000 ------------------------------------------------------------------------- Sylvan Lake, Pigeon Lake $400,000 $400,000 $430,000 ------------------------------------------------------------------------ Banff/Canmore $220,000 $300,000 $300,000 ------------------------------------------------------------------------- ------------------------------------------------------------------------- British Columbia - Salt Spring $600,000 - $1,000,000 $700,000 - Island(xx) $700,000 $1,000,000 ------------------------------------------------------------------------- Ucluelet $155,000 $159,000 $450,000 - $500,000 ------------------------------------------------------------------------- Tofino $240,000 $230,000 $450,000 ------------------------------------------------------------------------- Comox Valley $170,000 $180,000 $350,000 - $400,000 ------------------------------------------------------------------------- Okanagan Valley - Kelowna N/A N/A $350,000 ------------------------------------------------------------------------- Vernon N/A N/A $550,000+ ------------------------------------------------------------------------- Penticton N/A N/A $500,000+ ------------------------------------------------------------------------- Thompson Valley - Shuswap Lake - Salmon Arm, Sorrento, Sicamous $250,000 $250,000 $450,000 ------------------------------------------------------------------------- Sun Peaks $199,000 - $225,000 - $250,000 - $385,000 $425,000 $500,000 ------------------------------------------------------------------------- Fraser Valley - Harrison Lake N/A N/A $350,000 ------------------------------------------------------------------------- Cariboo - Interlakes Area N/A N/A $180,000 ------------------------------------------------------------------------- Sunshine Coast N/A N/A $500,000+ ------------------------------------------------------------------------- ------------------------------------------------------------------------- (x) Starting price for a three-bedroom winterized recreational property on a standard-sized waterfront lot (xx)Oceanfront Property
For further information
Christine Martysiewicz, RE/MAX Ontario-Atlantic Canada, (905) 542-2400
Eva Blay or Charlene Quenneville, Point Blank Communications, (416) 781-3911
Amber Piché, RE/MAX of Western Canada, (250) 860-3628
Source: RE/MAX Ontario-Atlantic Canada; RE/MAX of Western Canada