Muskoka Real Estate Market Update – January to October 2014
Blog by Susan Brown | January 1st, 2014
The recreational resale market started relatively slowly in the spring of 2014. Although weather conditions were not as extreme this year as last, they were severe enough that they negatively impacted the early market. However as the year progressed the number of available properties for sale increased and with an increase in inventory, sales also increased. By the end of October, sales of recreational properties had exceeded reported sales for the same period in 2013. This marks the second consecutive year in which sales have exceeded the number of reported sales from the year before.
The Muskoka Haliburton Orillia Association of Realtors have reported the following market data. Overall the number of recreational properties available for sale increased by almost 11 percent, from 1150 in 2013 to 1273 this year. This follows on the heals of a 9 percent increase from 2012 to 2013. Similar increases are evident in the various recreational cottage districts that Chestnut Park agents work with buyers and sellers.
On the Muskoka Lakes there were 385 active listings at the end of October compared to 335 in 2013, an increase of almost 15 percent. In 2012 there were only 277. Compared to 2012 available recreational inventory has increased by almost 40 percent. Similar increases were evident in both Lake of Bays and the Haliburton Highlands.
On Lake of Bays there were 138 properties available for sale at the end of October. In 2013 there were 117, an increase of 18 percent. In the Halibuton Highlands the increase of available properties is not quite as dramatic. This year there were 285 available properties, last year there were 275.
Over the last three years sales have followed the available inventory. As the number of available properties for sale has increased there has been a corresponding increase in reported sales. In 2014 overall recreational property sales totaled 830, a 13 percent increase compared to the 732 sales reported to the end of October 2013. The Muskoka Lakes reported 253 sales, a 19 percent increase compared to the 212 reported sales in 2013.
Interestingly both the Lake of Bays and Haliburton Highands markets produced results that were inconsistent with the overall market and the other recreational trading areas. Notwithstanding the increase in active listings both of these markets have remained static for the past three years. One explanation is price-point. The average sale price in this market is considerably lower than the properties available on Muskoka’s big lakes, Rosseau, Joe, and Lake Muskoka. Average sale prices in Muskoka’s big lakes have drifted downward since their pinnical in 2007, in some cases by as much as 25 percent. That downward drift appears to have stabilized. Buyers’ expectations are now closer aligned to that of Sellers, which in combination with increased choice, resulted in increased sales, including a large number of higher-end ($3 Million plus) sales.
Chestnut Park’s agents were responsible for a record in recreational property sales. At the end of October our property sales by volume had increased by over 16 percent over last year. The value of real estate sold increased dramatically by 34 percent to $220,853,434, the highest volume of sales in the history of the firm. The previous best year was 2007, when $201,080,000 in dollar volume of recreational property sales was achieved. In the Port Carling market place, the Chestnut Park office out sold our nearest competitor office by 114 percent.
Looking beyond 2014, and barring any unforeseen shocks to the economy – the recent meltdown of the stock market was disconcerting – 2015 should be a year similar to 2014. Assuming inventory levels remain high, anticipate an increase in sales volume by about 3 to 5 percent. As always it is fundamental that Sellers price their properties realistically. Any undue exuberance in pricing will result in properties lagging on the market, often beyond one season. As recent analysis of the Muskoka resale market disclosed that properties sold substantially below their original list price, in some cases as low as 25 percent. In addition, it took months, and in some instances two or more selling season before these properties sold.
Feature image credit to MuskokaBlog.com
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