Muskoka Cottage Real Estate Market – Should I Wait to Buy My Cottage or Not?
The Canadian real estate market has seen an unparalleled surge throughout the COVID-19 pandemic. Homeowners around the country suddenly found themselves stuck at home with plenty of time on their hands, causing many to upgrade their home to better suit their lifestyle, seek out that cottage property that always seemed to elude them, or even explore the world of real estate investing. No matter what the cause, it’s undeniable that the pandemic’s impact on the housing market in Canada has been felt everywhere – even here in cottage country.
The sale price of Muskoka cottages, like properties everywhere, have increased during the pandemic, and are poised to continue growing over the next year. The still hot housing and recreational property markets has led to many potential buyers wondering whether or not they should take the plunge and invest in the surging Muskoka cottage real estate market, or if they’d be better off waiting it out. The answer to these hesitations is further complicated by low inventory and the fact that even experts aren’t sure what’s going to happen to the market once restrictions are relaxed throughout Canada and the rest of the world.
The state of the Muskoka cottage market in 2021
With cities everywhere experiencing red hot real estate markets that are only now just beginning to cool slightly, the Muskoka cottage real estate market is still feeling the heat. Muskoka’s real estate market has been affected by people migrating from the city and those looking to purchase a second home or cottage. In fact, Royal LePage recently reported that home prices in the Ontario recreational property market increased 19.4% from 2019 to 2020, and that prices are expected to continue to climb through 2021 – possibly as high as 17% in Ontario.
The market as a whole has experienced record high demand for real estate, with low inventory across the board which has resulted in tense bidding wars in markets where such a thing rarely ever occurred. Some real estate agents are reporting that they’re witnessing up to 10 offers on every listing. Cottages in particular are quite sparse in terms of inventory, meaning buyers looking to purchase a Muskoka cottage have limited options. While most years would see little activity during the winter months, 2021 started with an unprecedented amount of activity, once again showing the consistent sense of urgency felt by many home and cottage buyers.
Should you buy a Muskoka cottage now or wait it out?
While experts are suggesting that the Ontario real estate market is finally beginning to cool after months of growth, the high demand and low inventory being seen throughout cottage country is reason to believe that the market will remain hot in Muskoka for the foreseeable future – at least until things return to normal and the housing market as a whole begins to stabilize. With low inventory, consistently low interest rates and many buyers facing the dreaded fear of missing out, now might be the time for buyers to jump into the Muskoka cottage market if it makes financial sense for them to do so.
The inventory scarcity means that if you see your dream cottage on the market, it might be a while before another perfect property is listed. If you decide to buy a Muskoka cottage, be prepared to be met with plenty of competition – other buyers will be ready to swoop in at a moment’s notice with a higher or more aggressive bid. If you’re looking to take advantage of interest rates and secure the cottage of your dreams, and aren’t scared off by the very real possibility of being involved in a bidding war, then now’s the time to get in.
On the other side of the argument, the unknowns about what the rest of the year may look like are enough to make even the most confident buyer a little gun shy. If the market returns to “normal” quicker than expected due to COVID-19 restrictions being relaxed at the end of the summer season, demand may ease up and inventory could return to its normal level.
The truth is that nobody can predict what’s going to happen, though experts continue to suggest that a return to normalcy for the Ontario real estate market will likely take quite some time. If a cottage is in your future but isn’t necessarily something you need now, waiting out the market could save money and the headaches that could stem from bidding wars and aggressive buyers, but may mean that you lose out on the possibility of the low interest rates currently being offered by lenders.
With so much happening in the real estate market and the situation changing almost daily, it’s highly recommended that you speak to a real estate professional and mortgage specialist before making any big decisions about a purchase.
If you’re buying a cottage, chances are very good that it’s going to need some new windows. In a hot market, sellers don’t tend to do the renovations they normally would to increase a property’s sale price. Muskoka Window & Door Centre is cottage country’s preferred supplier of high performance doors and windows. Our expert team has years of experience in door and window installation, working with the biggest and best names in the industry. For years, we’ve worked with Muskoka cottage owners, builders and architects to help create unforgettable views that can be enjoyed for years to come. To find out more about the window and door products and installation services offered by Muskoka Window & Door Centre, get in touch with us today.