Re/Max Canada’s recently released Cottage Trends Report for 2023 reveals that Generation X is now leading recreational property transactions, driving activity in 91 per cent of the surveyed recreational regions. 

 

Gen X drives recreational property transactions in Canada

 

The report notes that historically, retirees have been the major force behind the recreational property market, including both Baby Boomers and Gen X. 

However, following record-setting activity in 2022, demand tapered in the year’s second half and through the first quarter of 2023, leading to more balanced conditions in 50 per cent of the regions. 

The report predicts that consumer confidence will increase in tandem with the temperature into “cottage season” and throughout the remainder of the year. Average residential sale prices are expected to rise by 0.9 per cent.

 

Passing down properties to family is a key motivator for recreational property buyers

 

According to a Leger survey conducted on behalf of Re/Max Canada, 51 per cent of Canadians who own or plan to own a recreational property, including 47 per cent of Gen Xers, pointed to the opportunity to pass down a recreational property to family as a key motivator to buy one.

The survey found that 42 per cent of current recreational property owners are holding onto their properties in the hopes of passing them down to family members, while 56 per cent have or plan to put their property in their beneficiary’s name while they are alive. 

Three-quarters of recreational property owners feel confident that with proper succession planning, they will be able to seamlessly pass down their property to family members.

 

Quality of life and affordable prices are top priorities for recreational property buyers

 

The report notes that as Canada continues to experience affordability challenges, 36 per cent of Canadians who own or plan to own a recreational property, including 45 per cent of Gen Xers, are attracted to recreational markets for the liveability they offer compared to larger city centers, a figure that is higher among prospective buyers, at 55 per cent. 

The top five “must-haves” among Canadians for recreational properties include:

• An affordable purchase price.
• Proximity to water or waterfront.
• Reasonable maintenance costs.
• Proximity to needed amenities and all-season access to emergency services.

 

According to Elton Ash, executive vice president of Re/Max Canada, the quality of life that recreational markets offer is another appealing factor of recreational property ownership, and as the lines between recreational and residential properties become increasingly blurred in a trend that emerged during the pandemic, quality of life has become even more important. 

Ash adds, “As the warmer weather approaches and economic conditions begin to stabilize, buyer confidence is returning to recreational markets.” 

 

Regional trends in Canadian recreational markets

 

Re/Max Canada brokers and agents provided an analysis of their local market activity for the first quarter of 2023, as well as an outlook for the remainder of the year. 

The report reveals that retirees, families, and couples are the top three consumer segments leading activity in the market, at 82 per cent, 68 per cent, and 55 per cent, respectively. Waterfront properties, at 77 per cent, and access to recreational activities, at 59 per cent, like skiing and water sports, are the most sought-after features of recreational markets.

 

Western Canada

 

The report notes that regions in Western Canada have either transitioned to balanced or remained favouring sellers. Specifically, Albertan cottage markets, such as Canmore and Sylvan Lake and surrounding areas, and Whistler, B.C., skew towards sellers, due to demand outpacing supply. 

Meanwhile, in British Columbia, both Tofino and Ucluelet can attribute balanced conditions to buyers becoming more reserved and releasing pressure on demand. Adhering to the prevailing national trend, Gen X and more specifically families, couples, and retirees propel demand in Western Canada.

 

Ontario

 

Despite most regions favouring sellers last year, following interest rate hikes and ongoing economic uncertainty, 67 per cent of recreational markets in Ontario are now in balanced conditions. 

Muskoka, Haliburton and Greater Sudbury, Windsor-Essex, Manitoulin & French River, ON are the outliers that still favour sellers.

Demand remains strong, particularly from Gen X buyers and families, who are attracted to the region’s natural beauty, recreational activities, and family-friendly atmosphere.

In Muskoka, the average residential sale price is expected to rise by 2.0 per cent in 2023, and 4.0 per cent in the Kawartha Lakes region.

 

Atlantic Canada

 

The recreational property market in Atlantic Canada remains highly favourable for sellers due to the limited inventory available in most regions. 

Despite a decrease in the number of sales year-over-year in most cottage markets in the Atlantic, the report indicates that many regions including Sydney & Cape Breton, N.S.; St. John’s, Nfld.; Charlottetown Area, P.E.I and Annapolis Valley, N.S. experienced modest year-over-year sale price appreciation, ranging from 3.5 per cent to 15.3 per cent.

One of the primary factors contributing to the sustained appeal of these markets for buyers outside of the region is the relatively lower price point in comparison to Ontario and Western Canada. 

Additionally, the report suggests that out-of-province buyers, including retirees, couples, and families, continue to be drawn to the region. The Gen X demographic is also a significant driver of demand in the Atlantic recreational property market.

To view the full regional data table from Re/Max Canada, click here.