Cottage by Alex
Royal LePage released results of a nationwide survey projecting the approach of Canadians towards investing in recreational property. A vast majority (89 per cent) of Canadians who either bought or plan to purchase a vacation home in the next two years consider purchasing a recreational property to be a wise and long-term investment.
Better Than Stock Market
Moreover, the survey shows that 50 per cent of actual owners and prospective buyers think that recreational properties provide a larger financial return than investing in the stock market. Only 29 per cent regard the stock market as being more profitable, and 21 per cent were indecisive.
According to the figures, a 57 per cent majority of voters expressed that their will to buy a vacation home wouldn’t be affected by the expected interest rates hype. Most of these respondents (70 per cent) were older than 55.
More than a third of the voters (35 per cent) answered that tightening their belts during the year is the most probable financial and lifestyle sacrifice to help to buy a recreational property. The two least popular methods (chosen only by 13 per cent of respondents) were to drive as far as necessary and to turn the recreational property into a primary residence.
It’s worth mentioning that 51 per cent of those questioned responded that they either are or plan to be renting out their ownership. However, 32 per cent of respondents say that they would be cautious when renting their property and would only rent their vacation home to someone who has been recommended by an acquaintance.
Reasons for Purchasing
Phil Soper, president and chief executive of Royal LePage Real Estate Services, says that offering recreational property as rentals is a common strategy of young people and that it “may allow younger families to acquire a cottage earlier in their lives than they would otherwise, and others may be able to buy in a region that would have been out of their reach, price-wise." He continues, "The purchase motivation for most is not financial planning. It remains lifestyle driven – satisfying the needs and wants of their family.“ According to 92 per cent of the respondents, having a vacation home is “a great way to bring family together.“
The Royal LePage figures also show that the national average recreational property price range is between $100,000 and $1,000,000. The average price range in Ontario is $150,000 – $750,000. Year-round usability, quiet, and rental potential are the three most appreciated aspects of recreational properties polled by Ontarians.