With the warming spring sun, Muskoka has become a buyer’s market.
Those looking to secure a piece of Muskoka’s pristine paradise have more options this year. According to the most recent stats for the Lakelands North cottage country region from the Canadian Real Estate Association (CREA), the number of active listings in the region increased by over 50%, year-over-year (y-o-y), in May.
In May 2023, the region saw 508 active listings. In 2024, this figure had climbed to 766, representing a notable 50.8% increase.
May-over-May, there’s less flurry on the market compared to 2023 (and definitely since the red-hot summers of the pandemic). In May 2024, the average days on the market was 26.5, a 11.5 day jump from a 15-day average in May 2023, when the Muskoka market was described as "balanced."
The year-to-date figures are perhaps most indicative of the current market conditions, which suggest an emerging buyer’s market in Muskoka, according to Maryrose Coleman of Halloran & Associates, Sotheby's International Realty Canada. Coleman, who specializes in cottage country, says the region is seeing a gradual shift into a buyer’s market territory this year.
There were only 268 year-to-date sales transactions up to the end of May of 2024 — a 15% increase over the same year-to-date period ending May 2023, when there were 232 sales. But more inventory is the name of the game for 2024. There were 1,107 new waterfront listings in the region, up 47.8% (or 749) y-o-y through to the end of last month.
Red muskoka chairs on a dock at at sunrise in the fogstoreys.com
The Lakelands North region saw 7.7 months of inventory in May of 2024, a figure significantly higher than the five months of inventory in May of 2023, highlights Coleman. Furthermore, year-to-date months of inventory, up to the end of May 2024, increased to 8.6 months versus last year's 6.1.
In addition to higher levels of property inventory, sales prices are dropping. Average sales price of $1,583,529 in May of 2024 was down slightly (-1.4%) from last year. The median price for a waterfront property was also down (-13.5% to $967,500) compared to May of 2023.
When it comes to the year-to-date figures, this year's average sales price of $1,331,533 was down 6.7%, compared to year-to-date figures from May 2023. The year-to-date median price of a waterfront property, $951,000, was down only slightly ( -1.7%) y-o-y.
“Property inventory and days on market increases, combined with average and median sales prices dropping, seem to confirm what we all suspected over the last six months, which is that the seller's market is over for the time being,” Coleman says. “We have now moved from a balanced market in the last two quarters of 2023 to a buyer's market over the first five months of 2024, with 8.6 months of inventory available.”
For context, a seller’s market is defined as zero to four months of inventory or properties available for sale. A balanced market is just that; a balance between inventory and buyers, which translates to four to six months of inventory. Finally, a buyer’s market sees six months or more of inventory for sale, which means that to clear existing inventory would take six months or longer. This all translates into lots of choice for Muskoka buyers, says Coleman.
“That being said, lingering questions about interest rates, geopolitical instability, and inflation concerns seem to show that, while there has been an increase in year-to-date sales transaction volumes and more properties are actually selling, anecdotally, buyers lack a sense of urgency to jump at a ‘for sale’ property,” says Coleman. “When offering on a property, they have resumed the practice of consistently offering below list price, in mostly solo-offer scenarios, and are including traditional finance, home and septic inspections, seller's warrants, and other contingencies.”
The cottaging season of 2024 has brought some notable market trends, says Coleman. “One current market trend that is undeniable is that properly priced, well-staged, and desirable waterfront properties between $1M and $3M enjoy strong buyer demand,” says Coleman. “These properties are typically sold turn-key, with all the furnishings, and will sell slightly below list price within three weeks on the market.”
Moving up in price, Coleman says that waterfront properties priced in the $4M to $8M range are currently selling at a reasonable pace. “But to convert to a firm sale, again the key is price,” she says. “These properties are also located on the popular lakes and have the desired features such as a level lot, preferred exposure, easy accessibility from the city, and privacy.”
According to Coleman, the super luxury waterfront market (sprawling estates in the $10M to $25M price range) is taking it easy at the moment. “It’s quite slow right now, with all of the affluent, all-cash buyers holding out for only the best of the best: premium lake estates with all bucket-list items ticked, and mostly restricted to the coveted addresses of the Big 3 Muskoka Lakes (Rosseau, Joseph, and Muskoka),” says Coleman.
To recap, with 8.6 months of available inventory, we have now firmly shifted into a buyer's marker territory in Muskoka.
“Buyers are able to wait patiently for the right property to come along,” says Coleman. “For sellers, as always, preparing the property for the market by doing any essential repairs, staging, and pricing at market value are key. If they're overpriced, properties will sit. Ultimately the market speaks, and well-priced, well-marketed properties will sell.”
