Muskoka Waterfront Marketplace
Across Ontario Lakelands Real Estate Board (Muskoka, Haliburton and Orillia), 2015 results were ahead of 2014 performance in price and marginally lower in the number of properties sold. Average price across the board increased 7% while the number of waterfront properties sold declined 1.6%. Both Orillia and Haliburton had increases in the number of properties sold while the District of Muskokanumber was down by 7.4%. As far as average prices go, Muskoka and Haliburton prices rose by 10.4% while Orillia’s declined by 2.1%.
Muskoka Big 3
In Muskoka, the story continues to reflect changing ‘buy’ patterns. Prices achieved on the smaller lakes rose, while the number of sales declined. On the Big 3 (Joseph, Rosseau and Muskoka) the number of sales reached a 9 year high and average price achieved was a record at $1,546,231, a 2.8% increase over 2014. Within the broad price range of sales on the Big 3, we see variation each year. Two years ago, sales over $2 million increased by more than two thirds from 2013 and properties under $1 million increased by 14%. This past year told a different story. Sales over $2 million declined by 14.9% while the number of properties sold between $1 and $2 million increased by 66%. The number of properties sold less than $1 million declined by 4%. Anecdotally, properties above $2 million tend to be major renovations or new builds. People in that range, are buying property that requires little immediate maintenance or updating. They are paying for work that has already been done. With the increase of sales in the below $2 million range, there may be an increase in renovations as people buy properties to enlarge or update.
Some of the leading builders of high end property comment that acquiring land to develop for their select builds is becoming increasingly difficult. More and more, developers are buying existing cottages, tearing down and rebuilding. Good quality vacant land is hard to come by.
The total number of properties sold on the large lakes was ahead of the peak year of 2007 by 3. In total, on the Big 3, 47% of all waterfront property that came to market in 2015 sold. There were 416 listings of which 194 sold at an average of 94% of the listing price at the time of sale.
In 2014 (the last peak year) there were 26 island sales or 13% of total units sold on the Big 3. In 2015, 28 island properties sold on Lakes Joseph, Rosseau and Muskoka. The range of prices was large from a low of $250,000 to a high of $10,500,000. The enticement for purchasers is land value and privacy. Island property is significantly less costly than mainland. The trade-off is convenience. More people want to be able to drive to their cottage property rather than have all that boat access implies. Market value reflects convenience in this case. Performance characteristics of island property are different from mainland as well. 34% of island listings sold in 2014 vs. 52% for mainland. For the intrepid islander, however, island cottaging offers adventure, privacy and a relationship with the water not found on the mainland. The Rosskoka Team was fortunate to represent 2 of the top 5 high value island properties sold last year, both of which sold quickly.
Lake of Bays
Lake of Bays (LOB) waterfront property market in 2015 settled back to more sustainable level in terms of price. The average sale of $921,152 declined from $1,083,397 in 2014 which represented a peak not likely to be seen again for a while. That said, 2015 showed a healthy increase over the previous high year of 2013. 2014 was an anomalous year in that a couple of very high value properties sold skewing the mix.
Relative to Lakes Rosseau and Joseph, LOB is smaller and travel times from the city are generally longer by half an hour or more. The number of transactions over the last 10 years has averaged 40 per year, with the highest being 53 in 2007. Numbers that are very close to Lakes Rosseau and Joseph by comparison. However the adage of “the bigger the lake, the more expensive the land” holds true. LOB averages around $4000 per linear foot while the other two lakes are more than 25% higher.
In 2015 there were 3 sales on LOB north of $2 million, one of them being on Bigwin Island with all that it has to offer with golf and fine dining. The actual number of sales on LOB in 2015 was below the 10 year average by 15%.
If extra travel time is not an issue from the Golden Horseshoe, the lake is excellent value. Combined with protected waters, high water quality and beautiful Pre-Cambrian Shield scenery, boating to golf, shopping and restaurants is what gives this lake and the Big 3 of Muskoka an almost unique cottage experience. Like the Big 3, LOB has families who have cottaged along its shores for generations. LOB is a cherished home for many.
Days on Market
The average days on market (DOM) for properties that sold was less than 60. Overall, the number was slightly shorter than 2014. Typically island and small lake properties take longer to sell than larger lake mainland properties by 15% or more.
The Crystal Ball
Throughout the winter we receive inquiries about property for sale and from others who wish to sell in the coming season. Over the last decade or more, we have learned that our level of winter busy-ness is a good indicator of what to expect when the snow and ice departs. This year our winter has been especially busy. The inquiries for spring are more numerous than since before 2008. We expect a strong year in 2016.
A Factor that might support this is the value of our dollar. People are prepared to invest in Canada from outside. Discretionary Canadian dollars don’t go as far internationally either. Historically sales to out of country buyers have accounted for 10+ percent of the year. We expect that percentage to rise in 2016. Another factor is the volatility of equity markets. Muskoka values are steady in light of the stock market. Relative to the housing market as well, our high and lows are not as extreme. We believe more properties will sell in 2016 than in 2015 as Muskoka is a good place for capital to reside. …and a good place to enjoy it too!
This year, Rosskoka is celebrating our 12th year in Muskoka real estate. More than ever, people count. Relationships matter. Business is transacted through referral and introduction. Every year our business has grown through referrals from existing clients who were happy with our service. Thank you!
Our goal is to make the selling and buying process stress-free and to provide researched, expert insight about the marketplace. We know that buying and selling takes time – whether it’s finding the ‘right’ place or deciding to list a property that’s been in the family for generations. Cottages are special places. If you have questions about the marketplace in general or activity on your lake, we can provide real estate data for every lake in Muskoka-Haliburton. Interested in an Opinion of Value of your cottage in this market? Want to know what’s available? Looking for a lifetime cottage or a property to invest in? Please contact us!
Ross, Peter & Lucy
ps Fifteen properties came o market between December 15th and January 15th. Click here to check them out.