Making sense of the real estate market isn’t easy. It’s impacted by so many outside factors that long term predictions are difficult.
The threat of tariffs, inflation, interest rates, and other elements have caused a bit of trepidation in certain market sectors so far this year.
Combined with people changing their travel patterns, many weddings and other gatherings finally taking place after being delayed, and the warmer weather taking a bit longer to arrive, the cottage country real estate market started slowly.
Experienced brokers like Bob Clarke of Royal LePage Lakes of Muskoka Clarke Muskoka Realty can offer the insight necessary to navigate the market during seemingly uncertain times.
There are still deals being made, provided the property is listed with an honest value and the realtors are willing to put in the work.
“The reality is that you have to work twice as hard, but the good news is that I have active buyers and they’re shopping,” explains Bob. “And they’re qualified buyers, they’re ready to go.”
“I would say we’re somewhere between a balanced market and buyer’s market,” he adds. “It’s actually a lot more comfortable for everyone. Our buyers now can get home inspections, we can do the homework on the property, and we’re not in this frenzy.”
Due diligence
The homework includes vital concerns like the age of a septic system, potential bylaw issues when renovating or adding, whether aging structures have issues that need to be addressed, and more. There are also factors that less experienced agents might forget to check, such as whether there are still old furnace oil tanks buried on the property.
“We want to make sure to do our due diligence and ensure our clients are getting the best value for their money,” says Bob. “If there are properties that check all their boxes and don’t have huge barriers, then we can evaluate if the listing price lines up with an accurate value for the home or cottage.”
If the price is right
One thing Bob has noticed since the pandemic frenzy subsided in mid-2022 is that many properties are still being listed much higher than their true value.
The Clarke Muskoka Realty team looks at several factors when evaluating a good price for their clients (both buyers and sellers).
What is the lot worth? What’s the value of the building? How much do accessory buildings like bunkies add to the value? What was the price of other sales on that lake – or similar properties on other lakes?
“There are a number of properties on the market that are either overpriced or there’s too much work to do on them,” he says. “When we get into a tough market, people try to ‘buy listings’, so they put the number too high, and then the property sits on the market too long.”
Local knowledge is key
Bob says when choosing to buy or sell a property in Muskoka, particularly on the water, it’s important to carefully consider who to work with. The real estate market in cottage country is extremely different than that of a city.
Going with someone from the local area who understands all the nuances of shoreline setbacks, road allowances, and other similar rules and regulations will save time, money, and stress.
That doesn’t even include the fact that one body of water can be in three different municipalities, each with its own set of rules.
Bob says he has encountered many situations over the years where an underinformed agent from outside the region has run into issues that they didn’t know how to solve.
Factors to consider include the timing of sun exposure, topography, water depth and quality, what changes you’re allowed to make to the property, what changes might be coming on neighbouring properties, shoreline setback requirements, and so much more.
Aging buyers or those with aging family members are going to be wondering how they can ensure full enjoyment of the property, including creating easy access to the water.
There’s also the complicating factor of the many roads that are owned by the property owners and unmaintained by the town or township. Understanding what you own and don’t own, including your responsibilities, is a vital piece of information when buying a home or cottage.
“It’s not because we want to keep all the business; it’s because these are complicated transactions,” he explains. “If I’m doing condo deals in downtown Toronto, I want a realtor from that area who knows the ins and outs. The same idea applies in Muskoka. You need to use an experienced, local representative who understands all the complexities.”
TEXT CHRIS OCCHIUZZI
