Canada’s recreational real estate market remains strong with healthy single-digit growth expected for 2018.
The likely exception to this positive outlook is British Columbia where the new speculation tax could dampen demand for secondary residences, especially among Albertans who could look elsewhere.
Royal Le Page has just released its forecast for the recreational homes market and expects average prices nationwide to rise 5.8% year-over-year to $467,764.
"Driven by the strength of the nation's economy, Canada's recreational real estate market is set to experience another strong year," said Phil Soper, president and CEO, Royal LePage. "While home values and sales activity in Canada's largest urban markets have softened, demand for recreational properties remains robust in most regions. The search for that perfect summer getaway continues unabated."
Regional variations for prices
The cottage season will not bring the same benefits to all regions with several factors in play.
Prices for example will diverge across Canada with strong growth in Ontario (rising 10.4% y-o-y to $535,885) and Alberta (up 8.9% y-o-y to $770,100); while prices are forecast to decline in Atlantic Canada (by 7.5% to $228,654) and British Columbia (by 2.8% to $531,333). Manitoba dips but essentially remains flat with a 0.9% decline to $230,833 over the same period.
The shift in focus of Albertans who want to avoid BC’s extra tax could see price rises in Alberta’s own markets such as Canmore, and west of Calgary in the Rocky Mountains.
|
Provincial Pricing Chart |
|||
|
Region |
2017 |
2018* |
Year-Over-Year % Change |
|
Canada |
$442,239 |
$467,764 |
5.8% |
|
British Columbia |
$546,444 |
$531,333 |
-2.8% |
|
Alberta |
$706,950 |
$770,100 |
8.9% |
|
Saskatchewan |
$302,500 |
$304,750 |
0.7% |
|
Manitoba |
$232 917 |
$230 833 |
-0.9% |
|
Ontario |
$485,551 |
$535,885 |
10.4% |
|
Quebec |
$282,405 |
$290,271 |
2.8% |
|
Atlantic Canada |
$247,229 |
$228,754 |
-7.5% |
Inventory to increase
Royal Le Page is also forecasting a rise in inventory, again depending on the region.
Ontario will be the exception to a national trend for rising inventory while BC will see a strong increase as the speculation tax prompts secondary home owners who live outside the region to sell.
"With Canada's fastest growing economy, British Columbia's vast and varied recreational regions might be expected to lead the country," continued Soper. "That will not be the case in the near-term as new taxes aimed specifically at recreational property owners are expected to weaken markets across the province, driving would-be purchasers to invest elsewhere.”
