For years, the Canadian real estate market has been dominated by a handful of cities, such as Toronto, Vancouver and Montreal. Everyone wanted to live in these red-hot markets – and for a good reason. These urban centres have everything you would want, from arts and entertainment to a diverse range of amenities. Then, of course, the coronavirus pandemic happened, and it turned everything upside down, including the dominant trends within the Canadian real estate market.
Who would have predicted at the start of 2020 that big city dwellers would be fleeing these metropolises to live in rural areas? This is one of the trends unfolding in the fallout of the COVID-19 public health crisis. With more Canadian businesses embracing work-from-home policies, many people are taking advantage of the opportunity to relocate to cottage country. As such, small cottage country towns are becoming attractive destinations for homebuyers.
Whether you are ready to pack up and leave your city-living days behind, or you’re looking for your next big investment opportunity, here’s what you need to know about some of the hottest markets in Canadian cottage country.
Canadian Real Estate: The Hottest Markets Across Cottage Country
#1 Kawartha Lakes, Ontario
The Kawartha Lakes has long been a getaway target for Torontonians since it is roughly a 90-minute drive from the heart of the city. The region is mostly known for its cottage vacations, but it offers a diverse array of activities and sights, including horseback riding, boating, hiking trails, golf, and so much more. Plus, you can access the Trans Canada Trail and Ferris Provincial Park. Now that the pandemic has altered buying trends, Kawartha is turning into an all-season home for many city dwellers.
According to the Kawartha Lakes Real Estate Association (KLREA), residential home sales surged 39.5 per cent in July. Home prices rose 3.8 per cent to a record high of $480,164. Since Kawartha is becoming a top destination for homeowners in the Greater Toronto Area (GTA), there has been a surge in demand, but supply has been unable to keep up, which has turned the municipality into a seller’s market.
#2 Muskoka Lakes, Ontario
Like the Kawarthas, Muskoka is at the top of the list of most popular cottage country destinations. And, like the Kawarthas, Muskoka provides so much more than an idyllic getaway. From Gravenhurst to Bracebridge, you can relish in great seasonal festivals, hiking, wineries, and art galleries, all year long.
The Lakelands Association of REALTORS® reported a 29.8-per-cent jump in non-waterfront residential sales and a 64.2-per-cent spike in waterfront sales in July. Prices within Muskoka have also popped: 15.5 per cent for non-waterfront properties ($385,250) and 21.5 per cent for waterfront housing ($675,000). The housing supply in Muskoka remains low, but the demand continues to rise, resulting in a seller’s market.
#3 Gulf Islands, British Columbia
If you desire to be on the west coast, consider the Gulf Islands in British Columbia. This has long been a much-desired cottage destination, mainly for its five major islands (Pender, Galiano, Mayne, Salt Spring and Saturna). Although the Gulf Islands are appealing due to the fact that you can choose to disconnect, or you can still stay connected to the outside world with frequent B.C. Ferries, water taxis and private boats.
The Gulf Islands have been steadily rising for several years now, and real estate agents in British Columbia say that the region could attract even more interest in the months to come. Over the last year, prices have risen as much as 41.61 per cent. Since 2015, prices have gone up as much as 132.7 per cent!
#4 Eastern Townships, Quebec
For years, people have rented cottages for their chalet-style getaways in Eastern Townships. The Quebec region has 89 municipalities, including Magog, Sherbrooke and Coaticook. In addition to being surrounded by nature, the southeastern Quebec region has plenty of gourmet wine facilities, spas, golf courses, and winter sports, as well as more than a dozen national and regional parks that can be enjoyed year-round.
Data from the Quebec Professional Association of Real Estate Brokers suggest transactions climbed as much as 20 per cent in this region. Prices above the $500,000 level are also the new norm, and experts forecast that prices will continue to go up amid more Montrealers fleeing to the suburbs.
#5 Frontenac County, Ontario
Frontenac County is a three-hour drive from Toronto, sandwiched between Kingston and Ottawa. It would be easy to surmise that Frontenac is attracting mostly Torontonians, but the urban flight trend is bringing people from large cities across Ontario. The main problem is that affordable all-season cottages do not stay on the market long, especially those priced below $500,000.
In July, Kingston and its surrounding areas witnessed a new sales record, rising 35.8 per cent from the same period last year, says Kingston and Area Real Estate Association (KAREA). The average price of homes sold was an astounding $458,026, which was up 15.2 per cent from July 2019.
Earlier this spring, many cottage country mayors discouraged urbanites from leaving their big cities to come to these small towns for fear of spreading the highly infectious respiratory illness. But these warnings might not have been enough for city dwellers searching for vacation homes or all-season cottages. As people from the nation’s largest cities seek less densely populated communities, cottage country destinations nationwide can anticipate a massive boom – and this could last all year long for many of these rural regions. For realtors within these small communities, perhaps the fiercely competitive bidding wars commonplace in Toronto and Vancouver’s real estate transactions, will become the new norm in 2021. Stranger things – like for example, a global pandemic and killer hornets – have happened.
Cape Breton University to honour physician and real estate tycoon – TheChronicleHerald.ca
SYDNEY, N.S. —
An oncologist and a real estate mogul will be this year’s recipients of honourary degrees from Cape Breton University.
Dr. Ronald MacCormick, oncologist, and Louis J. Maroun, real estate, will be presented with their honourary degrees during the university’s fall convocation set for Nov. 7.
“Both Dr. MacCormick and Louis J. Maroun have represented our island in their respective careers and they have impacted thousands of Cape Bretoners; one in life-saving cancer care and one in international business and philanthropy,” said David Dingwall, university president and vice-chancellor.
MacCormick is the chief medical oncologist at the Cape Breton Cancer Centre.
He completed his medical training at Dalhousie University and his specialty training at the Princess Margaret Hospital in Toronto. His highly-reputable medical practice and his role in developing the state-of-the-art regional cancer center has impacted patients from across Cape Breton Island and parts of mainland Nova Scotia.
“Although I was not born in Cape Breton, both my parents are from here and I have spent the vast majority of my career here and raised a family here. My connections to Cape Breton Island and the people I care for are deep and I am a proud promoter of Cape Breton,” said MacCormick.
Maroun was born and raised in Sydney and holds a bachelor of arts degree from the University of New Brunswick and is a Fellow of the Royal Institution of Chartered Surveyors.
Considered one of the most prolific executives in national and international real estate transactions, Maroun first began his career in real estate in 1982 after seven years with the Nova Scotia provincial government.
He has built a highly-notable career and has been dedicated to his philanthropic work with such charitable organizations as the Cape Breton Regional Hospital Foundation, the Canadian MS Society, Casting for Recovery Canada and Cape Breton University’s Shannon School of Business.
“I credit my Cape Breton roots with giving me the drive, ingenuity and determination to succeed in my business career. It also taught me the value of caring for each other during adverse times, which led to my desire to give back to my community,” said Maroun.
Cape Breton University has been awarding honorary degrees since 1989.
The fall convocation will be celebrated through a virtual platform and to view the ceremony, visit www.CBUConovcation2020.ca.
The Niagara Real Estate Trends You Need to See – RE/MAX News
How could the Niagara real estate market be better off today than it was a year ago? It’s just one more thing to add to the growing list of unprecedented phenomena dotting the 2020 timeline. The Canadian economy may be feeling the sting of pandemic-related business closures and job loses, but the housing sector is booming from coast to coast. Every segment of the industry, from the condominium market to the luxury niche, is performing well through the COVID-19 pandemic. Niagara is no exception.
Even before the coronavirus public health crisis, Niagara had been an attractive place to plant roots. Big-city dwellers may have also wanted an excuse to migrate to the southeastern region, but work and the amenities of major metropolitan cities prevented the move. With changing consumer trends and societal shifts unfolding today, many families now have their eyes set upon this municipality that blends suburban charm with city culture.
So, just how strong has the Niagara real estate market been in recent months? Several trends are emerging across the region, from declining inventories to ballooning demand. Niagara could be one of the hottest markets in Ontario real estate heading into 2021.
The Niagara Region Real Estate Trends You Need to See
According to the Niagara Association of Realtors’ (NAR) latest data, residential home sales activity surged at an annualized rate of 37.2 per cent in August, totalling 978 units. Prices also experienced double-digit gains in August, rising 15.3 per cent to $482,600 from the same time a year ago.
The other important development was the average days it took to sell a home – which was 35 days in August 2020, down from 43 days in August of 2019.
Terri McCallum, President of NAR, attributed the robust growth to steady inventory levels and multiple offers on listed properties.
Despite the steady increase in property values, Niagara remains one of Ontario’s most affordable markets, according to the 2020 RE/MAX Housing Affordability Report. For a long time, a large chunk of demand for Niagara real estate had been driven by retirees. However, with more professionals working from home, remote workers have been elevating demand and taking advantage before housing prices increase even further.
But how much more is the Niagara real estate market expected to grow? The RE/MAX Fall Market Outlook Report estimated that Niagara real estate could increase as much as six per cent in the remainder of 2020, which is roughly in line with broader Ontario real estate market performance in the final quarter of the year.
What Is Driving the Niagara Real Estate Market?
Niagara is another community benefiting from the growing trend of families leaving major urban centres and planting roots in small towns. Whether it is due to fears over hyper-dense cities or employers introducing work-from-home policies, people are choosing to live in areas other than Toronto and Hamilton. This allows them to save money on housing and enjoy more square footage for their dollars.
Like nearly every other market in Canada, Niagara is seeing a flood of homebuyers amid historically low interest rates. At the height of the coronavirus pandemic, the Bank of Canada (BoC) slashed interest rates to nearly zero per cent. Further, the Bank lowered the conventional five-year mortgage rate to below five per cent. Put simply, borrowing has never been cheaper, so homebuyers are taking advantage of this accommodative monetary policy and jumping into the market or upgrading their living space.
The lure of the Niagara region is undeniable; it is not hard to see why it remains a favourable destination for tourists and residents alike. Beyond hosting one of the seven natural wonders of the world, Niagara’s rich cultural community and natural sights offer enough to keep you busy year-round:
- The city boasts 101 wineries that churn out delicious Chardonnays, Gamays and Pinot Noirs.
- The region’s long summers and moderate winters are perfect for enjoying the 42 conservation areas, like Ball’s Falls.
- Farms and farmers’ markets offer up some of the best produce in the province.
- The many different festivals, including the Grape and Wine Festival, the Niagara Jazz Festival, and, of course, the Shaw Festival have historically been well-attended by tourists and local residents.
Is Niagara part of the near-term cash injection from impetuous borrowers who have decided to flee the Greater Toronto and Hamilton Area following the height of the pandemic? Or is the Niagara Region’s booming housing market part of a long-term trend? Indeed, Niagara’s trends are consistent with so many municipalities within the southeastern part of Ontario, many of which are projected to keep expanding for many years to come. Based upon its strong appeal and sound market fundamentals, the Niagara real estate market has more room for growth as we edge towards 2021.
Canadian Real Estate Is Becoming More Bubbly According To The US Federal Reserve – Better Dwelling
The world’s largest central bank is seeing the warning signals for Canadian real estate get brighter. US Federal Reserve (US Fed) updated their exuberance indicators for Q2 2020. Their measures for Canada show recent acceleration over the past two quarters. There was a brief period in the data where it appears Canada almost came back to reality. In the first quarter of this year though, buyer’s became more exuberant.
Exuberance Is Not A Fundamental
First, let’s quickly run through the concept of exuberance. Exuberance is the state of being excited. When used in economics, it means emotion and excitement is the driving mechanism. If a buyer is said to exuberant, they are buying not based on any fundamental reason – but rather their emotional reasoning. In other words, they’re paying more based strictly on the fact they think they should be paying more. Not because any fundamental basis is driving the valuation higher.
Exuberance doesn’t mean markets can’t or won’t go higher. Markets driven by an emotional state are more vulnerable to correction though. If buyers aren’t using fundamentals, then a sudden change in emotion means they need to discover the actual price floor. That’s sometimes a ways down.
Canadian Real Estate Becomes More Exuberant
Canada is seeing exuberance accelerate over the past few quarters. The indicator reached 1.89 in Q2 2020, up from 1.56 during the same quarter last year. The market has seen two consecutive quarters of acceleration.
Canadian Real Estate Buyer Exuberance
An index of exuberance Canadian real estate buyers are demonstrating, in relation to pricing fundamentals.
Source: Federal Reserve Bank of Dallas, Better Dwelling.
Canadian real estate has been consistently in this level for years, but not as many as some people want you to think. It first breached the critical threshold in Q1 2015, and hasn’t fallen below that level since. There’s been a few periods where it almost has, which have been followed by policy moves to prop up the market. Technically the market has only been exuberant for half a decade. Although that may feel like forever, it’s not really that long.
The Federal Reserve warns this indicator doesn’t tell us when we’ll see a correction, just the likelihood of one. After 5 quarters above the critical threshold, the Reserve believes markets will require a correction. The longer this trend persists, the further detached the market is from fundamentals. This means a larger correction will be required, whether in terms of falling prices or inflation that kills the real value.
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