Ontario is in the throes of what could be called a seller’s dilemma. The issue being, home costs are at record-breaking highs, but to cash in on your property’s value typically means entering the uncertain (and ultra-competitive) buyer’s market. 

There’s one caveat here, however, and it’s exclusive to those with a second (or third) property. Indeed, cottage-owners swim in the benefit of being able to cash in on their getaway’s equity without being forced to turn around and spend a hefty sum on another abode. And for those who have been on the fence – whether the hesitation stems from market uncertainty, sentimentality, or concerns about where summer days will be spent – one cottage country brokerage offers a unique opportunity.

“We really believe now's the time, especially with looming higher interest rates, that people can seriously consider unlocking equity,” says Ross Halloran, Broker and Senior Vice President, Sales at Halloran & Associates, Sotheby's International Realty Canada.  

“‘Unlock Equity’ is really a call to arms for those people who've been standing on the sidelines, wondering if they should sell or not.”

READ: Ontario’s Cottage Country Real Estate Sees Record-Low Levels of Supply

Halloran & Associates’ Unlock Equity offering presents cottage owners with a new approach to the sale of their place. It’s one that, through a tight-knit relationship with Muskoka District Rentals, connects sellers to the right buyers. 

“Let's say you have a legacy property that you’ve had for years, and you love it -- your family loves the cottage. But [you’re] getting more and more interested in the fact that [this cottage’s] value has appreciated dramatically, especially over the pandemic,” Halloran explains. “We work with both buyers and sellers. Our team has a track record of establishing new values for properties, because [as a] luxury brokerage, we have a lot of tools in our toolkit that allow us to do that.”

But on the buyer’s side, Halloran says, a common thread is presenting; about eight out of 10 buyers want to be able to rent their cottage out when they’re not using it. This is a practice that used to be more stigmatized, but in recent years, has become increasingly popular. Renting out doesn’t just offset the cost of ownership, after all: this extra income can be used to pay taxes, fuel and electrical costs, and take action on deferred maintenance. Halloran explains, “[it’s] just smart business; smart cottage ownership.” 

With this in mind, Unlock Equity -- alongside another Halloran & Associates program dubbed “List it and Lease it” -- can actually free sellers from needing to say a permanent goodbye to their cottage home away from home.

Maryrose [Coleman] and I founded Muskoka District Rentals, which is one of the leading full service rental agencies. So we're in a unique position to be able to pair up potential buyers with cottages, both as top agents for Sotheby’s, but also having this knowledge of the rental market and [knowing] what something might fetch for in the rental market,” Halloran explains. “In the summer, how much it would rent out for per week.” 

Equity11857 South Bay Shore Road East, Douro, ON (Halloran & Associates)

Essentially, Halloran’s team works alongside Muskoka District Rentals to pinpoint buyers who are interested in renting out their property post-purchase. Through their unique position of viewing properties from both a resale and rental perspective, Halloran & Associates informs buyers about realistic rental charges, and can facilitate a connection between the buyer and seller that allows those sellers to rent out the home post-sale, if they choose.

"We can help them negotiate a lease arrangement after they've sold it to the new buyers -- we'll say: 'these folks know the cottage, they've cared for it.' They'd be a perfect candidate to rent it when [the new buyers are] not using it, [and they] can earn income. And the win for the seller is that they divested the property, they've unlocked their equity, they get their payout, but they still have that access."

Or, Halloran explains, sellers keen on exploring a new lake will have a "war chest" for renting at their disposal, all while knowing they sold their cottage before interest rates hiked any further -- potentially cooling the market.

Whichever way they choose to use their unlocked equity, Halloran says, sellers "get to have their cake and eat it, too."

This article was produced in partnership with STOREYS Custom Studio.