Peter Mitham ,Western Investor, June 2006
By the time you read this, the 29 lakefront lots LandQuest Realty Corp. was marketing this spring east of Big Lake will probably have sold.
Small wonder too: More than half the lots boast 200 feet of south-facing waterfront, as well as plenty of land- three to 20 acres apiece. Nine lots on the 284 acre tract sold even before the properties officially hit the market.
LandQuest president Richard Osborne points to the property as an example of the strong demand lakefront properties are seeing from buyers across B.C., Alberta and beyond.
An “absolutely remarkable response” to the properties may not be unusual in the Cariboo, which has begun seeing small scale bidding wars as buyers stake their claims to properties with fervor equal to that of the gold miners who pioneered the region in the 1860’s.
Today, eager prospects are rushing in from the Lower Mainland and Alberta, Osborne said, drawn not by the glitter of gold but the sparkle of the region’s freshwater lakes.
“The market is so good for that kind of product in the Interior, and there’s so little product in the Interior that people are willing to go the distance,” Osborne said. “The radius has moved, at least for the right product.”
Though lots at Big Lake this spring were averaging $25,000 per acre, approximately a quarter of the price of comparable sites in the region, the Cariboo’s distance from major centres has traditionally made it a more affordable locale for lakefront properties.
What’s different today is that a lot more buyers are pursuing the handful of suitable properties offered for sale.
“The Cariboo is quite busy,” said Bill Lynch, principal of Re/Max Centre City Realty in Prince George. “There is very little waterfront left to purchase, and certainly the price on purchasing waterfront is extremely high right now.”
He found out first hand last year when he snapped up an old fishing lodge in the 100 Mile House area with lake frontage and seven acres of land. Price had gone up dramatically since his initial reconnaissance of properties a year earlier, but he believes the retirement plans of the maturing baby boomers will continue to fuel an appreciation in property values.
“I’m at the front run of the baby boomers. As they all go into their 50’s and towards their 60’s, they’re going to keep pushing the envelope, and they’re just not making much more waterfront anymore.” he said.
While amenities aren’t necessarily on the doorstep, the investment is attractive because it’s in the southern Cariboo- midway between the Lower Mainland and Alberta, two traditional sources of buyers.
“Our location, geographically, within the province seems to make a big difference,” said Brad Marsh, principal of the Re/Max office in 100 Mile House.
When price is no object, choosing between the Cariboo and the Okanagan is a question of which recreational activities buyers prefer.
Sport fishing, snowmobiling and cross-county skiing are the activities of choice in the Cariboo, while the Okanagan favours those with a taste for wine, golf and downhill skiing.
Resort-style developments capitalizing on the Okanagan’s ever-popular lakefront are booming, with major projects in the works including the 1000 unit Vintage Landing Wellness Resort planned for 869 acres along a kilometer of lakefront near Kelowna.
A brochure for the project, which the G Group of Companies plans to build over a 10 year period beginning with infrastructure next year, touts “an extensive suite of amenities including a pier, marina and boat launch as well as a beach club and restaurant.” Activities include “boating, kayaking, water skiing, fishing, swimming and general enjoyment of the expansive waterfront.”
Also playing off the lakes are the Barona Beach Lakefront Resort, a 142 unit project underway in Kelowna, and the 400 unit Greata Ranch development CedarCreek Estate Winery founder and senator Ross Fitzpatrick has proposed near Summerland.
In April, a four-and-a-half star luxury Westin Kelowna waterfront resort and spa was announced for downtown Kelowna. The $140 million project by Starwood Hotels & Resorts Worldwide Inc. and Sage Enterprises (Kelowna) Ltd. The hotel is to be sold as investor-owned suites, with prices from $250,000 to more than $2 million.
$1 million average
Getting a piece of any Okanagan action comes at a price.
MLS sales figures from the Okanagan Mainline Sales Board peg the price of waterfront properties in the central Okanagan as over $1.1 million, while the average transaction for a slice of bare land last year was $485,588. Select deals for well located tracts can be even higher.
“On Okanagan Lake, to get anything lakeshore now is extremely difficult. Real estate value alone is well over $1 million,” said Elton Ash, Kelowna based director for Re/Max Western Canada.
But for the most expensive waterfront properties in the province, head to the Kootenays, where cash-rich buyers from Calgary have helped boost prices through the Columbia Valley, said Phillip Jones, owner of Royal Le Page East Kootenay Realty in Cranbrook.
Based on figures from the BC Assessment Authority, Jones said the Lake Windermere area is seeing prices of $15,000 to $20,000 per foot of waterfront. That puts the standard half-acre lot with 100 feet of lakefront at $1.5 million to $2 million apiece.
Further south, the prices are lower thanks only to the greater distance from Calgary. Still, even a distance of just 45 minutes makes a significant distance. Jones said a property on Wasa Lake with a cabin sold for $800,000.
Top-line waterfront cottages in the Cranbrook area that cost just $350,000 two years ago have moved upwards of $550,000 this year, Royal LePage reports.
The $16 million expansion of the Canadian Rockies International Airport in Cranbrook, set to complete in spring 2007, promises to open the area to international demand.
“We’re short of supply now, and we’re probably going to get even more pressure on it.”
The airport upgrades includes expansion of the airport terminal from 10,000 square feet to 24,000 square feet. The renovations prime the airport to handle upwards of 160,000 passengers a year.
Jones said a sales trip to the UK in March indicated growing awareness of the Kootenay region and willingness to purchase into the area.
“There’s huge buying by UK buyers into our area,” he said. “They like the area, they like the prices- prices are very, very reasonable compared to the UK…they like the investment potential.”
Many buyers are purchasing in order to retire there or eventually emigrate, Jones said. In the meantime, they’re renting out the properties or treating them as vacation properties. Like many buyers, they’re leveraging the value of their primary homes to purchase the properties, which are a bargain compared to what they could find at home or in European vacation destinations.
“They’re getting double the accommodation for half the price- size, quality, everything,” Jones said.
In a special report on the Kootenays, Credit Union Central of BC economist David Hobden noted that $1.7 billion in recreational projects are under development, mostly in the East Kootenay region and Rossland and “include substantial housing and lodge components.”
Hobden also found a rabid real estate market. “Housing appears to be at a 23-year high,” he said, noting that currently eight per cent of all residential property sales in the East Kootenays have been held by the vendor for less than 180 days, which normally define a “flipper”. This compares with less than three per cent of homes that were being flipped in the area in 2004. Still, the credit union is forecasting that prices will continue to climb “at least through 2007”.
The international exposure and potential appreciation is spurring the expansion and development of resorts in the region, with Resorts of the Canadian Rockies pursuing an ambitious upgrade at its resorts in Fernie and Kimberley. All told, the initiative is values at $450 million.
It’s not just the big players that see renovation as a wise move.
Rudy Nielsen, president of New Westminster based NIHO Land & Cattle Co, said many buyers are willing to pay for older properties with direct access to the waterfront. Recent regulation governing riparian set-backs, septic tanks and wells have made older properties that are exempt from these regulations a good deal for investors.
“You’re better off to buy something that’s existing, pay a little bit more for it and renovate,” Nielsen said.
“Nowadays, if you buy a lot on the water, there’s a 30 metre setback. You can’t get close to the water…You’re better off to buy something right now that’s on the water and grandfathered.”
Realtors note that the setback bylaws have boosted the value of older cottages at lakes and on oceanfronts across British Columbia.
Nielsen notes you had better move fast for these opportunities.