Source – thechronicleherald.ca
- “…Strong demand for cottage country properties and a dwindling supply will drive up prices in Atlantic Canada in 2021…There’s cottages going for sale and selling in a day, and multiple offers and all this sort of crazy stuff, which we hadn’t seen in years,” he said”
Atlantic Canada cottage country prices set to go up in 2021
By Andrew Robinson
Published: March 23, 2021
Royal LePage forecasts 17 per cent jump in the aggregate price
ST. JOHN’S, N.L. —
Strong demand for cottage country properties and a dwindling supply will drive up prices in Atlantic Canada in 2021.
Royal LePage’s spring survey on recreational properties is forecasting a 17-per-cent increase over the 2020 aggregate price of $193,984 for recreational homes in Atlantic Canada. That raises the 2021 forecasted price to $226,961 for 2021.
Mount Pearl-based Royal LePage sales representative Glenn Larkin said there are a lot of factors at play. As was the case in 2020, there’s a shortage of recreational properties available on the market. That ties into the COVID-19 pandemic, as owners are more inclined to hold on to these homes at the moment, he said.
“People who used to trade in a scattered summer place— buy one, get a bigger one—(but) because they can’t find another one, they’re not putting theirs (up) for sale,” Larkin said. “And people are saying, ‘Well, I love my cottage. It is my cottage, and I’ll stay in it and I’m going to enjoy it, because we can’t go to Florida. We can’t go to South Carolina. We can’t go to Arizona.”
Costly building supplies
On the demand side, interest rates are among the best Larkin has witnessed in his 32 years as a realtor. Buying rather than building is more attractive at the moment, too, because construction costs have risen substantially. Larkin recently saw a two-by-four piece of lumber at Home Depot for $7.50.
“They used to be two dollars,” he said. “A shed costs almost $3,000 more to build. So, you can imagine what a house or cottage would cost extra. We’re in numbers of $20,000 to $30,000 more to build new as opposed to purchase a resale.”
Larkin doubts many people will travel for vacations in 2021, even as more of them get vaccinated. Some of this money saved can go into buying a summer place.
“There’s cottages going for sale and selling in a day, and multiple offers and all this sort of crazy stuff, which we hadn’t seen in years,” he said.
Larkin said there’s also interest carrying over from last year in the Newfoundland and Labrador market as the province is seen as a safer place to live during the pandemic.
Locally, Larkin suggests the recent launch of HGTV Canada’s new series “Rock Solid Builds” is generating interest in the picturesque Conception Bay North community of Brigus.
“You’ve got built up demand, shortage of property, interest rates are great—put it all in the mix and you’re getting good prices for cottages.”
Last year, the Atlantic region trended above the national average in a couple of categories for recreational properties. Waterfront property prices increased 18.8 per cent in 2020, rising from $214,896 in 2019 to $255,222. The average increase nationally was 9.8 per cent. Standard condominiums in Atlantic Canada jumped in price from $215,471 in 2019 to $260,297 in 2020—a 20.8 per cent increase that was double the national rate.