Derrick Penner , The Vancouver Sun, June 1, 2006
British Columbians dreaming of owning a waterfront cabin should prepare to go rustic, or be willing to pay $1 million.
Royal LePage's 2006 recreational property report says the average lakefront property in B.C. is touching $996,000, the highest in Canada. The next highest is in Alberta, where lakefront property will set buyers back an average of $900,000. The national average is $380,507.
British Columbians without $1 million to drop on lakefront near big population centres can still have their retreats -- they just have to travel farther north and settle for something more basic.
Rudy Nielsen, a Vancouver-based recreational property developer, said one of his firms sold one-acre lots on Nicola Lake near Merritt for $400,000 to $500,000. On Clucus [sic] Lake near Prince George, he sold one-acre lakefront lots for $45,000.
"Put your cabin on, and you can get a prefab one for $140,000, and you've got a cabin on a lake for less than $200,000," Nielsen said.
The Royal LePage report said demand for recreational property is high, fuelled by young professional buyers and baby boomers, and prices in most markets are still rising because supply remains scarce.
In B.C., the Royal LePage report focuses on Interior locations, where prices ranged from a low of $285,000 near 100 Mile House to a high of $999,000 to $4 million near Vernon.
The report defines a standard cottage as being three bedrooms and 1,000 square feet on a 100-foot lot.
Even those willing to bid as high as $996,000 could still be out of luck. The Royal LePage report is based on a national poll, which found that only 15 per cent of cottage owners were likely to sell their properties within three years.
B.C. skiers looking for a vacation retreat might have better luck. Royal LePage found the average price for a B.C. ski chalet is $370,313 compared with $512,500 in Alberta and a national average of $413,694.
However, when it comes to southern Interior lakefront, Riley Twyford, owner-broker of Royal LePage Downtown Realty in Vernon, noted that in his region, lakefront properties are no longer what most people would consider to be a cottage.
"There are people from Alberta who come out and buy them. . . and they'll spend three weeks in the summer [there] and may well call it recreational property," Twyford said. "But it's not your little cabin on the lake type scenario."
Paul Fabri, a market analyst for Canada Mortgage and Housing Corp. in B.C.'s Interior, said the market for lakefront recreational property has exploded in the last five years, but there is only limited lakefront in the communities where most people want to be.
"But there has definitely been huge demand, and of course finite supply, and that's pushing up prices," Fabri said.
For that reason, Fabri added, the development is more "high-end detached homes, or higher-end multi-family homes on the lake."
"You're not going to see someone put a weekend cottage [on Okanagan Lake], because the land is so valuable."
Twyford said many of his lakefront buyers are coming in from Alberta. "I guess it's oil-and-gas money," he said.
"We've had young families come out and spend in the high [hundreds of thousands of dollars] for property, and they're not living in it, so that's disposable income."
Royal LePage said its report was drawn from the national poll, conducted by Maritz Research, and market analysis of prices, activity and trends in selected leisure markets across Canada.
Generally, the poll found that nine per cent of Canadians own recreational property with four per cent planning purchases, and another five per cent considering purchases within three years.
Of those considering purchases, 19 per cent plan on paying cash for their getaways.
For B.C., the focus is on 100 Mile House, Cranbrook, Kelowna and Vernon.
Vancouver developer Nielsen, who also owns the research firm Landcor Data Corp., said high prices are driven by proximity to the major buying markets: Vancouver, Calgary and Edmonton, the regions he refers to as the "golden circles."
Nielsen said the overall recreational market in B.C. is hot and prices are being fuelled by a limited inventory. He said only five per cent of B.C.'s land base is privately owned, and estimated that only about 10 per cent of individually titled properties in the province are recreational.
"We have an inventory shortage and we're running out fast," Nielsen said. "Everybody, including myself, is subdividing hard and fast [to create more]."