There were no surprises in the last quarter of the recreational property market place on the Muskoka Lakes and Lake of Bays. The sales on the Muskoka Lakes continued to out perform 2009, while Lake of Bays remained practically unchanged. Actually it should be noted that in the last quarter of 2010 Lake of Bays sales moved from a negative variance of 11 percent (at the beginning of the quarter as compared to 2009) to a position that sales by the end of the year equalled sales for 2009. In both recreational market places the year end results were dramatically improved compared to 2008, the year in which recreational property market places (probably throughout the world) came to a halt as equity markets collapsed.
Sub-markets within the umbrella of the Muskoka and Haliburton Association of Realtors did not all achieve consistent results in 2010.
There were some markets, like Lake of Bays, that slightly underperformed, and others, like Haliburton Highlands, that on a comparative basis, out performed other market places in reporting the sale of recreational properties sold. On the Muskoka Lakes the Muskoka and Haliburton Association of Realtors reported 228 recreational properties sold for 2010. This compares to 217 in 2009, an increase of 5 percent. During all of 2008 only 128 properties were reported sold. (It should be noted, (see below), that Chestnut Park’s agents were involved in more sales in 2010 than the entire Association reported sold on the Muskoka Lakes in 2008). Unlike the Muskoka Lakes, Lake of Bays slightly under performed. In 2010, 88 properties were reported sold. This compares to 90 in 2009. As was reported in September, the difference in performance in these two market places is no doubt due in part to the fact that as prices have declined on the big Muskoka Lakes from 2007, more buyers have turned to that market place as a first choice as compared to Lake of Bays.
Overall for all recreational properties sold and reported by the Muskoka and Haliburton Association of Realtors the results were a welcome improvement over 2009. In 2010, 813 properties were reported sold. This compares to 768 in 2009, a solid 6 percent increase, and an incredible 44 percent improvement compared to the 566 recreational property sales reported in 2008.
Inventory levels increased in 2010. The Association processed 7,300 listings in 2010, an increase of 11 percent compared to 2009. In December there were only 87 available properties for sale on the Muskoka Lakes, a decline of 26 percent compared to December 2009.
The opposite was true for Lake of Bays. In December 2010 there were 77 properties available for sale compared to only 58 in 2009, an increase of 32 percent. The difference between the availability of properties on the Muskoka Lakes and Lake of Bays is no doubt due to the fact that more sales were recorded on the Muskoka Lakes, however, listings statistics for recreational properties for the month of December are, because of the time of the year, not reliable indicators of available product going forward.
Chestnut Park’s and its sales representatives dramatically out performed the market. The firm’s sales representatives were involved in169 transactions in 2010, an increase of 18 percent compared to 2009. The dollar volume of sales was even more impressive. In 2010 sales totalled $200,016,000. This amounts to a 32 percent increase as compared to the dollar volume of recreational properties sold by Chestnut Park’s sales representatives in 2009.
It is clear that the recreational market place in Muskoka, and more or less on Lake of Bays, has completely recovered from 2008. The market showed signs of improvement in 2009, and that was followed by a strong 2010. The market is now in balance and it will remain there in 2011. Anticipate a similar market in 2011 to that experienced in 2010. Prices will remain stable. Buyers simply will not over pay for recreational properties as was the case in 2006 and 2007. The crash of the equity markets in 2008, before recovery in mid 2009, has instilled pricing reality into the market place. Properties realistically priced in 2011 will sell. Overpriced properties will attract little buyer attention and will remain unsold. There will be no market updraft in 2011 that will rescue overpriced properties.
