Insider’s Guide to Cottage Real Estate

What is happening in the Cottage Real Estate Market? Is buying a cottage different than buying a city property? What do I need to know about buying a cottage? All these questions are so good and are all common questions we get asked from people who are considering buying a cottage as an investment property. The Webinar from July 28th featuring Angela Beatty from Keller Williams Realty Centres answered all of these and more. This week’s blog covers the key points from the Webinar. If you are interested in listening to the full webinar you will find it on our YouTube channel. So, let’s jump in and cover the key take aways from the Real Estate Webinar.

  • Is the cottage market shifting as we are seeing changes in the markets in the urban areas? Yes there has been a shift in the cottage country markets similar to elsewhere. Cottages are still selling but not the same day or before they even hit the market. We are not seeing multiple offers like before and they are not going over asking as a result. We are also seeing clauses such as financing and inspections back in the offers.

  • What is the best time of year to buy a cottage? Spring is the busiest season for buyers. Typically, it gets busy until end of June. While kids are off for summer vacation it is a bit slower and then in September, we see an uptick again. The September uptick is for the properties that didn’t sell when all the cottages flooded the market in the spring.
  • Can you change a 3 season to a 4-season cottage? Anything is possible if you have budget. Things to remember is that Bancroft and Haliburton Highlands have many 3 season cottages. In Muskoka, many of the 3 season cottages are older w/out foundations. This means you need to insulate and get heated water to the cottage. The other thing to remember is you need to make sure there is access to the cottage in the winter season. The other thing to remember is that it can be harder to get insurance on 2 season cottages and islands and as a result they can be harder to sell.
  • Does it matter if the cottage has a well or draws from the lake? No, it really doesn’t matter. If it is a well at the cottage that is used for the water source, then a drilled well is the best. Many cottages have water treatment systems now. The inspection will carefully look at this for you. Insurance will require you to prove, typically within 30 days of possession, that you have a UV filter on the water coming into the cottage, so it is safe to consume. A UV system will cost about $2000 on average.

  • What is the difference between a holding tank and a septic system? A holding tank is just that. It is a tank that hold the liquid and solid human waste. The largest tank is about 9000 L. The tank needs to be pumped out regularly. A Septic system is a a waste system. The solid and liquid waste goes into the system. The liquids go through the weeping tiles into the earth and the solids are left. These systems are pumped every 3-5 years and it costs about $200 for a pump.

  • What does it mean if the shoreline is owned or not? Can you buy it? The Municipality owns 66 feet from the shoreline on every lake unless the owner has purchased their shoreline. It is possible to purchase the shoreline if the cottage does not own it already. That is done through the Municipality. The issues come if you do not own the shoreline but have a boathouse or the cottage is built closer than 66 feet from the shoreline. In those cases, you don’t technically own the land that your structures are on. In many instances several cottages go together and submit the paperwork to the municipality.
  • Are there any lakes/municipalities where it is very difficult to do updates such as docks, boat houses etc.? There are 2 that off the top of my head are harder to work with and that is Lake Simcoe and Georgina. That said, they all want to work with you and help you achieve the cottage that you dream of but there is a process. That process needs to be followed. I have heard Trent and the Kawartha Lakes are very good to deal with and very helpful!
  • Are there easements on cottages and if so what type of easement could they be? Yes, there are easements on cottage property. The most common easements that we see and run into now are lane ways where multiple cottages access off. The other is an easement for Bell Canada and Hydro to be able to access lines and do repairs.
  • What do we need to know and consider when purchasing water access only or island cottages? The first thing to get figured out is your lender for the mortgage as some lenders don’t really like these types of properties. You need to consider what is the island and what you need. For example, is there Hydro there? What is the water source? There are no holding tanks and Septic systems on these cottages so are you okay to use a compostable toilet or upgrade to one if need be. Having guest is harder as you must go back and forth picking them up. You are not able to rent it unless there are water taxis on your lake as insurance companies won’t cover the boat being used by renters. Any errands you need to do take that much longer as do any renovations as you must get the materials to the island. This typically costs a lot more to do renovations also.

To end it off we asked Angela what she would tell Novice Cottage buyers: (1) You must be able to tolerate bugs and the outdoor animal life. (2) It is a different lifestyle. Don’t judge the cottage just because it is a bit older. Paint and cleaning can make something look totally different. (3) Use a specialist to purchase a cottage! They know all the things to look for and avoid and they will have local contacts for anything that you need.

As always, we look forward to hearing from you!

Happy Cottaging!