Who doesn’t dream of a home-away-from-home vacation property on a picturesque lakeside somewhere?
A recent survey shows that sales of recreational property are on the rise across country and the prices are expected to appreciate by nearly six per cent this year, particularly in Alberta and British Columbia. Alberta is leading the way on recreational property purchases, reaching prices of $535,885 on average.
Retirees and baby-boomers are the ones driving up vacation property purchases, flocking to lakes and streams, the seaside and mountaintops, with an eye towards retirement or a secondary home to raise children.
However, a spike down in the recreational property purchases was reported due to the newly introduced speculation taxes in British Columbia.
The tax targets property purchased by those who live primarily outside of the province and second homes, causing many existing homeowners to sell their secondary homes to avoid the steep fees. For instance, although there was an increase in sales in BC, the prices actually decreased by 2.8 per cent to just over $53,000 on average across the province.
The speculation tax also encouraged Albertans, one of largest cohorts of recreational buyers in BC, to look for properties elsewhere — like closer to home in their own province. Regions like Canmore, and west of Calgary in the Rocky Mountains were especially popular this year.
But the speculation tax is only part of the equation. Some areas in B.C., like the Cariboo, saw cabin prices soar by 25 per cent for lakefront properties. This is despite the new taxes and wildfires that devastated the region last summer.
Overall, the fluctuation on recreational homes are down to people’s appetite for certain type of properties and their prices. These trends are expected to continue in the upcoming years.