BY GARY MAY
The “Great Canadian Dream” of a waterfront home is being pushed beyond the reach of many as working professionals join the 55-plus generation in the rush for prime property near Ontario’s best lakes and rivers.
The increasing demand for recreational and retirement living near the water is radically altering the face of Ontario’s waterfront communities. There’s a dazzling array of luxury estates and country club communities on offer where once only seasonal cabins stood.
Developers, feeding the insatiable appetite for all-season homes near the province’s waterways, are being forced to look ever farther afield. They are snatching up old industrial sites, small infill properties and land along lakes farther away from the more than eight million people who call the Golden Horseshoe home.
The frenzy is fed by two groups:
• Those wanting to trade in the private, more remote cottages and homes they already own for something in an urban waterfront location, closer to shops, entertainment, services and medical care;
• Those still working and searching for second homes — vacation properties that could become their permanent residences once they retire, or establish home-based businesses.
“It’s all age groups,” says consultant Mark Wessel, an expert in adult and active lifestyle communities. “A lot of people want a second home, a weekend place. It’s back to nature they want, and quite often it’s waterfront, or near the water.”
Together, they are raising the bar on waterfront living.
Today, cottage country means four-season luxury. But while the selection is stunning, waterfront luxury in Ontario is coming at a price that will set house-hunters back on their heels.
Waterfront prices took a breather during the recession, and even fell on the high-priced “Big Three” lakes of Muskoka — Joseph, Rosseau and Muskoka. But in general, waterfront prices stubbornly refused to follow the real estate trend downwards, says Richard K.C. Ling, broker for Harvey Kalles Real Estate in Toronto, who deals in some of Ontario’s most spectacular properties.
“Waterfront prices never went down,” Ling tells MyNewWaterfrontHome.com. “Sellers just waited till they got their price. This year, prices have gone up again, and prices will climb as you have less (waterfront) property to play with.”
Even in the northern reaches of the Bruce Peninsula, Paul Annett of RCR Realty in Pike Bay says buyers last year expected to find the waterfront bargains the news media told them would be available. It simply didn’t happen that way.
The sobering truth about prices
It’s no surprise that waterfront real estate is “one of the best investments you can make,” says Pauline Aunger, immediate past president of the Ontario Real Estate Association and a Perth-based broker at Pauline Aunger Real Estate. That’s good news for anyone who already owns, but the statistics can be sobering for those still in the hunt.
Between 1987 and 2007, the price of waterfront resort property increased an average of eight per cent a year according to a Re/Max study. Between 2004 and 2007, the median resale price for waterfront cottages in Muskoka and Haliburton rose by 47 per cent, according to Cushman & Wakefield, compared to just 18 per cent for non-waterfront properties.
What makes real estate in waterfront communities so resilient? “Because there will always be seven buyers for every perfect waterfront home,” says Aunger. “The great Canadian dream is to own waterfront.”
Real estate agents report there are fewer and fewer empty building lots left in Ontario’s prime waterfront locations. “There doesn’t seem to be any easily accessible water left in Southern Ontario” that hasn’t been built on, says Aunger.
Karen Poshtar of Georgian Triangle Realty in Collingwood adds: “Finding the lots people really do want is a real challenge. There’s very little left.”
The Muskoka district exemplifies Ontario’s ideal Cottage Country. You’ll find few building lots available on the Big Three lakes, says Lynda Lynn of Lakes of Muskoka Realty in Bracebridge, and if you do, most will cost at least $600,000 — and that’s without the house.
A recent search did find one Lake Muskoka lot with 81-foot frontage for $445,000, but the next cheapest, with 421 feet of shoreline, was on offer for $1.3 million.
The wealthy long ago sewed up the best big-lake spots in Muskoka. It is here you’ll find the multimillion-dollar private estates that have always been out of reach for most, and rarely come up for sale. Instead, newcomers with sufficient wealth are hunting farther afield for the perfect spot to build magnificent waterfront estates “that wouldn’t look out of place along (Toronto’s exclusive) Bridlepath,” says Ling.
For those who can’t afford anything so lavish, compromising on location can save big bucks. Muskoka still has “back lots” — those on rivers and lesser-known and marshy “fishing” lakes. “The bigger the lake, the bigger the price,” explains Lynn. “You can build on an island for half the price. Or for $450,000, you can live on the Muskoka River, which flows into Lake Muskoka.”
If island living is a compromise you’re willing to make, you could take a 2½-hour drive from Toronto to Parry Sound, hop in your boat and within 15 minutes pull up to your own 1½-acre building lot, yours for $165,000.
Away from Muskoka, the Collingwood/Wasaga Beach region of Georgian Bay has always had its unique charms, with downhill skiing adding to the allure. But with the hunt for waterfront heating up, this area, just a two-hour drive from downtown Toronto, is gaining the kind of attention that’s boosting prices. An unserviced 50-foot lot at Wasaga will set you back at least $400,000. Farther west at Blue Mountains, you could find a 160-foot lot with sandy beach for $649,000.
The demand for the Muskoka mystique has become so great that in real estate circles they’ve started to refer to Orillia as “south Muskoka.” There, 1½ hours from Toronto, a building lot with city services and 35-foot frontage on Lake Simcoe is offered for $169,000.
Up the Bruce Pensinsula and at least 3½ hours from Toronto, a Georgian Bay building lot could cost $200,000 — if you can find one, says Paul Annett.
The shores of Georgian Bay can be pricey, but away from the bay on the Trent/Severn Waterway in Port Severn, two hours from Toronto, you could have a 142-foot lot for $225,000. On Penetanguishene Harbour and two hours from the city, there was a half-acre lot for $300,000.
If you’re searching for a Muskoka-like lake that’s not in Muskoka, you can reach the eastern Kawarthas from Toronto in two hours. There, a deep-water, 100-foot lot on Clear Lake could be yours for $400,000.
Even in Land O’ Lakes, north of Highway 7, perhaps the last remaining traditional Muskoka-style cottage country south of Lake Nipissing, the few remaining prime lakefront building lots are going for at least $200,000, says Chantel Winney of ProAlliance Realty in Northbrook. But it’s a three-hour drive from Toronto and more than two hours from Ottawa.
With the supply dwindling and prices on the rise, some buyers are spending hundreds of thousands of dollars — and more — for cottages and houses they can tear down and replace with four-season executive homes. “They want all the bells and whistles in 4,000 square feet of space with a ground-floor master bedroom suite,” observes Poshtar.
Here’s a look beyond the Muskokas to other waterfront communities to see what people are paying for their little piece of waterfront paradise: A knockdown home on Georgian Bay sells for $650,000; nearby, an 80-year-old beach-front cottage goes for $750,000.
Also in the Collingwood area, says Poshtar, a buyer paid $1.8 million for a 3,000-square-foot, 1983 ranch that “had been well kept but needed modernizing,” demolished it and built one she estimates to be worth $2.5 million to $3 million. In the East Kawarthas, a two-bedroom seasonal fishing cottage on a small lake sells for $250,000.
“It doesn’t really matter what a home looks like,” Poshtar says. “It’s all about location. And they’re not building any more waterfront, are they?”
Once you have the land, building your dream home can be costly, too. While construction costs vary widely according to location and quality of finishes, builders say a reasonable average is $150 a square foot for a mid-range home. That’s $600,000 for 4,000 square feet. If you’re building outside a serviced urban area, expect to add $20,000 for a septic system and $10,000 for a 30-metre-deep well. And you might have to pay to connect your new home to the hydro grid, too.
Condo waterfront living in high demand
Such costs are enticing many to look at condos on the water. Here are some recent examples of resale condos:
In the North Kawarthas, 2½ hours from Toronto, you can have a two-bed townhouse condo on Anstruther Lake with your own boat slip, on a private beach, starting at about $260,000. You’ll pay monthly fees and property taxes of about $250 and $300 respectively.
In Penetanguishene, you can buy a two-bed apartment condo for $250,000, with monthly fees and taxes of about $450 and $330. In Orillia, there’s a two-bed condo on the water for $269,000, with monthly fees and taxes of about $425 and $450.
Higher-end finishes and location come at a price. In Collingwood, there’s a three-bed luxury condo for $539,000. Monthly fees and taxes are about $530 and $620.
Ling explains the condo cachet this way: “To buy a half-decent home on prime waterfront is going to cost you $1 million. But you can get many of the same luxuries in a condo for $300,000 to $400,000. Some developments have homes with private shared beach. Not too many people can afford $5 million for a Muskoka estate that’s going to give you that.”
Meanwhile, thanks to the rush to Ontario’s waterfront, little-known towns and villages — where only simple seasonal cottages stood a few years ago — are being turned into upscale marina and beach club communities with deluxe amenities.
Among the waterfront locations where luxury condos, freehold townhouses and detached homes are being constructed: an Almonte stone mill; an old wood-beamed factory in Cornwall; a narrow neck of land next to a marina in Grimsby; along rushing rapids and waterfalls in Bracebridge; in a former ship-building port at Collingwood; and a former navy yard in Amherstburg.
Condos and exclusive detached-home communities with luxury amenities are going up along shorelines in farm country, near vineyards, orchards and roadside markets; others offer spectacular city waterfront views. Some include private dock space and clubhouses, and amphitheatres that provide the feel of living in vibrant urban spaces. You can have access to a private-community pier, a beach or, if you prefer, a rocky shore. You can choose from an array of heritage styles or modern urban chic.
Hotel-inspired residences offer recreational facilities and health care, under one roof. Some are creating new village centres, some are helping to give old industrial waterfronts a new purpose and others are springing up next to established resorts.
In Port McNicoll on Georgian Bay, they’re building a four-season resort village on the site of a former CPR ship terminal. In rural Ottawa, demand for waterfront living is so strong that one developer has even built his own lakes.
The price of luxury
But while condos and resort villages might offer a taste of luxury at a more affordable price than would a private estate, sustaining a lifestyle of country club facilities with private pools, golf courses and docks comes at a premium. Monthly maintenance fees of $1,000 or more are not unheard of for newly built, amenity-rich communities. And you’ll be sharing those facilities with your neighbours.
“Cottage country” used to mean a simple general store and a dirt road leading down to a two-room cabin, a Muskoka chair sitting at the end of the dock. Little of that remains. The emphasis today is on resort-style luxury living, even if that lifestyle is created on a little-known lake or river.
When developers are able to obtain prime real estate for a new development, they naturally crow about it. “We have recently been fortunate enough to acquire another 100-acre property,” one Muskoka builder says on his website. “Properties subject to these approvals are incredibly rare and will not be seen again.”
Farther south in Barrie, another builder says his project is “the last waterfront development that will ever be built in Barrie’s city limits.”
“A great deal of our water has already been built on,” says Joan Ricard of Lakes of Muskoka Real Estate in Bracebridge. “Old lodges and larger holdings are being bought and redeveloped. Or else developers are looking for other options.”
Developer Doug Gray has found one of those options. Instead of right on the lakes, he’s building condos in the centre of Muskoka’s lakeside towns because he says 55-plussers want to live near amenities and services. “Our customers want to be close to shopping, to curling and to go to the doctor,” Gray says.
Many, however, still demand their own waterfront lot, and that demand is extending the search for affordable property ever farther. Homes with water views are being built in St. Catharines on a bluff overlooking Lock 3 of the Welland Canal, on Ault Island in the St. Lawrence River near a migratory bird sanctuary, and along the shores of Lake Erie, westward from Fort Erie.
At the extreme westerly end of Southern Ontario, Essex County is promoting itself as the affordable 100-mile coastline, and real estate agents report inquiries not just from the region, but from the GTA and even Western Canada. Bordered by Lake Erie on the south and Lake St. Clair on the north, the area still offers building lots for under $100,000 and modest cottages for under $200,000. But prices are rising here, too.
Some are finding new ways to cope with the high price of waterfront. The Royal LePage recreational property report says some younger families are pooling their resources to buy properties together. Others are generating income by renting out their properties when they’re not in use, while still others are turning to fractional ownership, says the report.
A further trend is to buy a property that’s across the street or a block or two away from the water. “If someone can’t afford the beach,” says George Watson of In Touch Realty of Wasaga Beach, “they can move across the street where a lot would sell for less than half the price.”
But if your very own slice of private waterfront is what you want, finding that dream home for under $1 million will require a compass and an extra tank of gas.
Where might you find Ontario’s next Muskoka? “Northern Ontario is still affordable,” Aunger says. “Elliot Lake. Haileybury. There are plenty of untouched lakes there.”