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Young Canadian families look to unique financing methods to support dream of recreational property ownership

Over a quarter of Canadians with children under the age of 18 would consider selling their primary residence in the city in which they live to help finance the purchase of a cottage or cabin

• Young families are fueling demand: 73 per cent of regions surveyed reported that young families with children drive demand for recreational properties
• Buyers are increasingly selling their homes in Canada’s two largest urban centres and using the equity from the sale to purchase a cottage, cabin or ski chalet
• Almost two-thirds (65 per cent) of Canadian millennials (18-34 years old) would consider buying a recreational property in the next 10 years
• Peace and quiet rated as the most important feature to Canadians when considering spending time at a cottage or cabin, beating out spending time with friends and family

As real estate prices remain high in Canada’s urban centres, young families are looking for unique ways to finance their dreams of recreational property ownership. In a recent survey conducted by Leger, more than a quarter (28 per cent) of Canadians with children under the age of 18 indicated they would consider selling their primary residence in the city in which they live in order to purchase a cottage, cabin or ski chalet.

“Many Canadians with young families are determined to own a cottage or cabin and are willing to explore avenues to turn this dream into a reality. As real estate prices in areas of Canada remain high, more buyers are exploring unique financing options such as fractional ownership in a shared property, purchasing a recreational property with a friend and even selling their primary residence and putting the equity into a cottage or cabin.” – Christopher Alexander, Regional Director, RE/MAX INTEGRA Ontario-Atlantic Canada Region

In a separate survey of RE/MAX brokers and agents, 73 per cent of regions indicated that young families with children were a key driver of demand in their market, including established recreational regions such as the Okanagan Valley in B.C., Canmore, AB, Collingwood, ON and the Laurentians in Quebec. Retirees were also a key driver of demand across Canada, with more than half (55 per cent) of regions surveyed reporting an increase in retiree buyers this year compared to last year.

“Large numbers of retirees and Baby Boomers nearing retirement are putting the equity they received from the sale of their home in cities like Toronto and Vancouver into the purchase of a recreational property,” said Elton Ash, Regional Executive Vice President, RE/MAX of Western Canada. “Significant price appreciation in those regions has made recreational property ownership a relatively affordable option for many retirees. This has in turn resulted in the price appreciation that we’ve seen in popular recreational property markets such as Whistler in B.C. and Haliburton in Ontario.”

The RE/MAX survey of brokers and agents found that 39 per cent of regions experienced an increase in demand from buyers leaving either the GTA or B.C.’s Lower Mainland compared to last year. More local markets such as Salt Spring Island, located a few hours away from Vancouver and the Kawarthas in Ontario, experienced significant increases in demand as a result of this trend. Regions as far away as Ottawa’s Rideau Lakes Region and P.E.I’s north and south shore also received a boost from buyers leaving the GTA who are looking for great value on properties further out from the Greater Golden Horseshoe.

Millennials keen to enter recreational markets

In Leger’s survey of Canadians, almost two-thirds (65 per cent) of millennials (18-34 years old) expressed interest in purchasing a cottage, cabin or ski chalet in the next 10 years. A quarter of respondents also indicated they would consider purchasing a recreational property as an investment vehicle to help finance retirement. At the same time however, many millennials feel that high real estate prices in the city in which they live will negatively impact their ability to buy a recreational property in addition to owning a primary residence.

To overcome this gap between demand and affordability, many Canadian millennials are willing to turn to unique financing methods to help purchase a recreational property. Nearly half (44 per cent) of millennials said they would purchase a property with a family member, while 39 per cent would purchase a property and rent it out using a vacation rental site such as AirBnB. Additionally, over a quarter of young Canadians (age 18-34) said they would consider selling the primary residence in which they live, while one in five millennials said they would consider both fractional ownership of a shared property or buying with a friend.

Read the full 2017 Recreational Property Report including data and pricing chart.

Key Findings from 2017 RE/MAX Recreational Property Report Omnibus Survey

• Almost half (43%) of Canadians would consider buying a recreational property in the next 10 years
  • Almost two-thirds (65%) of Canadian millennials (18-34) would consider buying a recreational property in the next 10 years
    
• Nearly 1 in 3 Canadians (30%) that currently own property would consider selling the primary residence in the city in which they live in order to help finance recreational property ownership
  
• Almost one in five Canadians would consider buying a recreational property in the next 10 years as an investment vehicle to finance retirement:
  • Canadians 18-34 (Millennials): 24%
  • Canadians 35-44 (Gen X): 26%
  • Canadians 45-54 (Gen X): 21%
  • Canadians 55 – 64 (Boomers): 13%
  • Canadians 65+ (Boomers): 7 %
    
• 38 per cent of Canadians feel that high housing prices in their primary housing market will discourage them from purchasing of a recreational property in addition to owning a primary residence
  • Atlantic Canada: 23%
  • Quebec: 34%
  • Ontario: 41%
  • Manitoba/Saskatchewan: 32%
  • Alberta: 36%
  • BC: 46%

• More than 1 in 4 Canadians (28%) would consider buying with a family member in order to help finance recreational property ownership
  • Atlantic Canada: 36%
  • Quebec: 23%
  • Ontario: 27%
  • Manitoba/Saskatchewan: 31%
  • Alberta: 26%
  • BC: 32%

• Millennials (18-34 years old) willing to explore alternative methods to finance the dream of recreational property ownership
  • 44% of Canadian millennials would consider purchasing with a family member
  • 39% of Canadian millennials would consider renting out their property on vacation rental site
  • 28% of Canadian millennials would consider selling their primary residence in the city in which they live
  • 21% of Canadian millennials would consider purchasing fractional ownership in a shared recreational property
  • 20% of Canadian millennials would consider buying with a friend

• Canadians with young families (children under 18 years) are willing to explore alternative methods to finance the dream of recreational property ownership
  • 42% of Canadians with children under the age of 18 would consider purchasing with a family member
  • 38% of Canadians with children under the age of 18 would consider renting out their property on vacation rental site
  • 28% of Canadians with children under the age of 18 would consider selling their primary residence in the city in which they live
  • 23% of Canadians with children under the age of 18 would consider purchasing fractional ownership in a shared recreational property
  • 19% of Canadians with children under the age of 18 would consider purchasing with a friend

• Features and amenities rated most important when thinking of a weekend at a cottage or cabin:
  • All Canadians:

• • 1. Find peace and quiet: 56%
    2. Spend time in nature: 51%
    3. Spend time with family: 44%
    4. Relax after a busy work week: 32%
  • Canadian Millennials (age 18-34)
    1. Spend time in nature: 56%
    2. Find peace and quiet: 53%
    3. Spend time with family: 49%
    4. Relax after a busy work week: 46%
  • Atlantic Canadians:
    1. Find peace and quiet: 62%
    2. Spend time with family: 49%
    3. Spend time in nature: 42%
    4. Relax after a busy work week: 32%
  • Quebec:
    1. Spend time in nature: 55%
    2. Find peace and quiet: 53%
    3. Spend time with family 34%
    4. Relax after a busy work week: 27%
  • Ontario:
    1. Find peace and quiet: 58%
    2. Spend time with family: 49%
    3. Spend time in nature: 49%
    4. Relax after a busy work week: 34%
  • Manitoba/ Saskatchewan:
    1. Find peace and quiet: 54%
    2. Spend time in nature: 53%
    3. Spend time with family: 47%
    4. Relax after a busy work week 37%
  • Alberta:
    1. Find peace and quiet: 56%
    2. Spend time in nature: 53%
    3. Spend time with family: 44%
    4. Relax after a busy work week: 39%
  • BC:
    1. Spend time in nature: 56%
    2. Find peace and quiet: 54%
    3. Spend time with family: 44%
    4. Participate in some of my favourite outdoor activities: 36%