July 1st - 2011

ON THE MARKETS: Buyers bullish on recreational properties

Warmer weather often turns people’s thoughts to getting away from it all, and a recent survey reveals that many Ontarians love their cottages.

Warmer weather often turns people’s thoughts to getting away from it all, and a recent survey reveals that many Ontarians love their cottages.

Ontario residents rated the three most important attributes of a recreational property as four-season use (47 per cent), quiet (45 per cent) and rental potential (26 per cent), according to a 2011 Royal LePage report. A strengthening economy and an expected rise in interest rates prompted 46 per cent of prospective recreational property buyers to want to buy before a potential rate increase. Sixty-one per cent of those polled said they are likely to buy a cottage on a lake in the next two years, higher than the national average of 57 per cent.

On the national front, an overwhelming majority of Canadians believe a vacation home is a good long-term investment, the poll shows. Overall, 89 per cent of respondents agree that recreational properties are a good investment, including 91 per cent of Ontarians, 92 per cent of Albertans, 87 per cent of B.C. residents and 81 per cent of Quebeckers.

When asked to compare recreational properties to the stock market in terms of providing a better financial return, 50 per cent chose recreational properties while only 29 per cent chose the stock market, with 21 per cent undecided.

“Canadians’ confidence in recreational property mirrors what we’ve been seeing in Canada’s urban centres,” says Phil Soper, president and chief executive of Royal LePage Real Estate Services. “Canada’s traditionally buoyant recreational property market appears to have found its groove once more.”

If sacrifices are needed to buy a recreational property, 35 per cent responded that they were most likely to reduce personal spending to do so. The two least-favoured strategies were to drive as far as necessary and to make the recreational property a primary residence, both at 13 per cent.

More than half (51 per cent) of those polled said they are or will rent out their property to offset costs. However, 32 per cent will be selective, renting only to referrals or people they know.

The survey was part of the 2011 Royal LePage Recreational Property Report, an annual analysis of prices, trends and activity in selected markets. Visit www.royallepage.ca and click on the small Media Room heading at the top and then click on the news release, “Canadians confident in the investment potential of recreational properties” dated May 20.

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For more information contact

Ontario Real Estate Association

Jean-Adrien Delicano

Manager, Media Relations

JeanAdrienD@orea.com

416-445-9910 ext. 246