According to the most recent statistics from the Canadian Regional Real Estate Board (CREA), Ontario’s cottage country saw a notable drop in year-over-year sales in the month of December.
According to CREA, residential non-waterfront (properties more likely to be year-round homes, as opposed to cottages) sales activity recorded through the MLS System for the Lakelands Region totalled 190 units in December 2022 -- down a sharp 38.3% from the same period in 2021. Furthermore, residential non-waterfront sales came in 29.1% below the five-year average, and 26.4% below the 10-year average for the month of December.
Annually, residential non-waterfront sales totalled 4,634 units throughout 2022 -- a 34.4% decline from 2021.
Meanwhile, just 25 waterfront properties -- more commonly used as summer homes and cottages -- sold in the Lakelands Region in the month of December. This marks a 51% drop from the same period in 2021. Waterfront sales were 46.6% below the five-year average and 48.6% below the 10-year average for December. Annually, waterfront sales totalled 1,170 units over 2022, a notable drop from 45.9% in 2021.
According to Ross Halloran, Broker and Senior VP Sales for Halloran & Associates, Sotheby’s International Realty Canada, some of these figures should be taken with a grain of salt.
“I would only say that the December 2022 results over December 2021's are misleading, as they are an anomaly, and one should not infer any ‘aha insights’ from this one-month period in isolation,” he explains.
“The real sales insights are revealed in the year-to-date (YTD) numbers to end off December 2022. While most 2022 sales statistics are lower than YTD December 2021 (i.e. 2022 waterfront unit sales were down 45.9% from 2021 -- the lowest level since the financial crisis of 2008), on the positive side, we also see that the 2022 median price of a waterfront property increased 9.4% over 2021.”
This reflects continuing buyer demand and low inventory levels, Halloran explains.
He points out other interesting CREA research findings include how December 2022 listing inventory increased to 3.8 months, up from 1.8 months last December -- something he says paves the way for potentially a stronger spring 2023 market.
“Median days on market rose to a nominal 15 days in December of 2022, versus 11 days in December 2021, reflecting continuing strong buyer demand leading into winter/spring of 2023,” Halloran says. “Sales-to-list price ratio jumped from an all-time high in 2021 of 107% of listings, down to 2020[-like] levels of 99.1%, which is the second-highest ratio on record and again reflects strong buyer demand for limited listing inventory.”
So, there’s room for optimism for those looking to sell in the Lakelands Region.
“Overall, with the 2022 correction squarely in our rear view mirror, combined with buyer adaptation to higher interest rates and increases in listing inventory, these market conditions seem to be in place to support a traditionally strong spring waterfront market in central and northern Ontario," says Halloran.
READ: Summer Plans? How to Hunt for a Cottage During the Winter Season
In the meantime, prices in cottage country have definitely cooled in the wake of their red-hot pandemic-inspired flurry of activity. The median price for residential non-waterfront property sales in December 2022 was $682,000, a small drop of 2.8% from December 2021. The median price for waterfront property sales in December 2022 was $780,000, a substantial decline of 18.4% from December 2021.
Whether the demand in cottage country heats up with the thawing of the ground will remain to be seen.
This article was produced in partnership with STOREYS Custom Studio.
