Muskoka Real Estate Market Summary – 2015

2015 was a banner year for the Muskoka and area recreational market.  Chestnut Park and its sales representatives were responsible for the highest volume of sales in the firm’s history, surpassing even the exceptional results achieved in 2014.

All of the markets encompassed by the Muskoka and area Realtor’s Association produced positive numbers in 2015.  The Association reported 1160 recreational properties sold, 23 percent higher than the 890 properties reported sold in 2014.  Lake of Bays reported 112 properties sold as compared to only 84 in 2014, an increase of 33 percent.  The Haliburton Highlands also reported strong numbers.  There were 320 recreational property sales in 2015, a 30 percent increase compared to the 246 properties sold in 2014.

Muskoka’s big lakes, Lake Joe, Lake Rousseau, and Lake Muskoka, have produced increased sales for three consecutive years.  In 2013 there were 223 reported sales on the big lakes.  That number increased to 266 in 2014 and then further increased to 292 in 2015.  Compared to 2013 and 2014, the results achieved are 19 and 31 percent respectively.

The bulk of the activity on the big lakes was in the $2.5 Million price range.  An analysis of sales having a sale price in excess of $1 Million indicates that in 2015 there were 100 properties sold in this price category.  This is an increase of 15 percent compared to the 87 recreational properties that sold in 2014.  The average sale price for all recreational properties sold with a sale price greater than $1 Million was $2,560,740.  In 2014 the average sale price was $2,693,322.  This difference in average sale price indicates that there were more lower priced properties sold in 2015 (i.e. closer in value to $1 Million) than in 2014.  For example if we review sales having a sale price in excess of $1.5 Million, the average sale price for these properties sold in 2014 was $3,002,028, but up substantially to $3,245,708 in 2015, an increase of more than 8 percent.

Further indication of the strengthening of the big lakes market in 2015 is the time it took for cottage properties to sell and the sale to list price ratio of these properties.  In 2014 it took 80 days (on average) for all properties with a sale price of $1 Million or more to be reported sold.  For properties in the $1.5 Million plus range it took 82 days from listing to sale date.  In 2015 both of these numbers decreased to 73 days for properties having a sale price of $1 Million or more and 78 days for those properties having a sale price of $1.5 Million or more.  Similarly the sale to list price ratio improved from 93 percent to 94 percent in both of these categories year over year.

What these statistics tell us is that there were more sales in 2015, these sales happened faster than in the past, and that sale prices were closer to asking prices than past years, all signs of a strong, broad market.

Chestnut Park and its sales representatives produced a record breaking year for our buyers and sellers in 2015.  Total dollar volume of sales exceeded $250 Million, the first time that that number has been surpassed.  Our total number of recreational property sales was also up by 10 percent, another record for the firm.  In Port Carling our office exceeded the results of our next closest competitor office by more than 46 percent in dollar volume of sales, a great accomplishment by Chestnut Park’s sales representatives.

Although 2015 was a market high, a number of negative economic changes appeared in December and have carried over into the early days of January.  These changes cloud the horizon as we attempt to peer into 2016 and the market we might encounter.  In December the Toronto stock market dropped precipitously, a drop that has continued into the first week of January 2016.  The Bank of Canada recently reduced its 2016 forecast to less than 2 percent growth, probably closer to 1.5 percent.  Western Canada continues to suffer as a result of declining oil prices.  As of the preparation of this report oil prices were hovering at $30 a barrel, the lowest they have been in more than 10 years.  On the international scene China continues to struggle, with no sign of change in its stagnating economy. When the Chinese economy slows, commodity oriented countries such as Canada are immediately impacted.

Recreational property purchases are discretionary.  History has demonstrated that during slow economic periods recreational markets also slow.  Hopefully by the time the market gears up in early spring some of these dark economic clouds will have cleared.  The low Canadian dollar (69.57 cents to the American dollar at the time of this report) may see more Americans purchasing properties in the Muskoka and area marketplace.  The bottom line is that we enter 2016 with various economic uncertainties that were not present in 2015.