Is it (finally) a buyer’s market in cottage country?

While the situation presents a challenge to sellers, it’s an opportunity for those looking to buy their first vacation home. Cottage inventory is high, prices are dropping and mortgage rates have slowly but steadily come back down. We spoke to realtors Megan McLeod and Rebecca Campol of Sotheby’s International Realty Canada in Port Carling, Ont., to learn more and get tips on buying your first cottage in Canada.

Back to work—and away from the cottage

First, how did we get here? It’s a mix of pandemic and politics, according to McLeod. “January was a totally different market than February,” she says, noting that the recreational property market came to “a screeching halt” shortly after President Trump was sworn in. “Buyers were putting the brakes on, hesitating. And as soon as buyers lose confidence because the stock market isn’t performing well or interest rates are going up, it affects real estate.”

While buyers and sellers alike were in a holding pattern earlier this year, things quickly shifted again in the spring. “After the Canadian election [April 28], there was a bit more certainty. You started to see sellers listing their properties, buyers arriving.” Now, there’s plenty of inventory on the market—plus, a lot of highly motivated sellers.

It wasn’t just economic conditions that affected the markets. Many pandemic-era buyers had plans to work from their cottage for some or even all of the year, but were then called back to the office. Others assumed they’d be able to consistently rent out their cottages at inflated rates (some cottage owners were getting as much as $10,000 per week in rent during the pandemic, whereas the same property might get $3,000 per week today). When rental fees dropped back down, maintaining a recreational property became less appealing to some new owners and in certain cases, unaffordable. 

Investing in recreational property

There are plenty of cottages on the market across Canada, which is good news for first-time buyers. With more inventory to choose from, there are fewer bidding wars and less pressure on buyers. “You can do your due diligence,” Campol says. “You have more time to shop around and do inspections.” 

Whether you’re looking for a family vacation home or an investment property, there are certain characteristics to look for if you want your cottage to appreciate in value. Privacy is a huge factor, McLeod and Campol agree, and a low-maintenance property is always a good idea. This doesn’t just mean the landscape around the building, but the materials used on the structure itself. “Construction and labour costs have gone up, so low-maintenance is extremely attractive now and in future,” McLeod says.

A large property with water access will always be in demand, and upgrades like aluminum and glass decks don’t hurt. During the pandemic, many buyers wanted to be close to town with access to a reliable Internet connection and strong mobile phone reception. Also, avoid stairs if you can—a flatter, gently sloping property is more valuable than something on a steep hill with a long staircase to the dock. Your family may be young and agile now, but between guests, grandparents and good old aging, “someone’s knees won’t be able to handle it,” McLeod says.

The best bang for your buck—on any budget

Very few cottages come at bargain prices, but there are deals to be found if you know where to look. The specifics will vary by province and region but generally speaking, smaller lakes come with smaller price tags. In Ontario, locations like Lake Joseph, Lake Rosseau and Muskoka Lakes will always be in high demand, McLeod says, but they come at a very high price point. However, there are lower prices to be found on smaller, lesser-known lakes in the same geographic area. “Look at smaller lakes in Muskoka. Look at Haliburton and the Kawarthas,” McLeod suggests. “You can still get that true cottaging experience—a great cottage on a lake at a good price.”