Glut of cottages for sale in southeastern New Brunswick

SHEDIAC, N.B. – A record number of cottages are for sale this summer in southeastern New Brunswick.

Areas around Moncton, like Shediac, have seen 20 per cent more single-family homes, including cottages, go up for sale. That’s about 3,200 properties on the market, an increase of about 400 over last year, according to Ralph Pritchard, a realtor with Royal Lepage Atlantic.

That means many cottage owners are not able to sell their properties.

Karla Arsenault, of Pointe-du-Chene, has had her property up for sale since December. In that time she said not a single person has inquired about it.

“I’m not sure if it’s just properties aren’t selling right now,” she said.

Arsenault’s property is less than a ten-minute walk from both Pointe-du-Chene Warf and Parlee Beach. In her neighbourhood, there are nearly two dozen properties for sale, ranging from $55,000 to more than $300,000. Arsenault is trying to sell her’s for $89,900 and said the house has been winterized.

“We do live here all year,” she said.

Arsenault’s situation is common and according to Pritchard, there are dozens of new people listing properties every day. He said if everyone stopped listing new homes, it would take about 14 months to sell all the homes that are already on the market at the current average sales rate per month.

“I’ve been watching it everyday. I go in everyday and see how many are listed and how many are sold,” Pritchard said. “My own personal view when I look, I’m thinking today it’s five to one, today it’s seven to one. Seven listed, one sold. But they tell me that on average, it’s about three listed, one sold.”

Pritchard said there are several reasons for this glut in properties. One is that Baby Boomers are downsizing, moving back into the city to get closer to medical appointments or changing rural properties for condos so that it is safer to leave them unattended for several months in the winter, if they choose to go south. Others are simply dying and passing on the properties to children who cannot afford the upkeep.

“As you know the economy hasn’t been that great, salaries haven’t improved over the last four, five years,” Pritchard said.

He added that many people are wary about getting a cottage that can only be used in the summer months because of the property tax paid on a second property. Tax credits on your family home mean the average property tax is only about 1.5 per cent, however this amount doubles to about 3 per cent on any additional property. Putting in a summer home is out-of-reach for many.

Out-migration is also a factor, according to Pritchard. The population in New Brunswick is stagnating, but Pritchard says construction on new homes is continuing. This means the price of houses is not far above the price of a summer cottage, which isn’t often insulated or heated and cannot be used in the winter.

The average price people look at for a cottage is between $100,000 to $150,000, while the average price for a house is about $165,000 in the province, according to Pritchard.

“It’s a case of supply and demand. We learned that in public school,” Pritchard said. “If you have a large supply, prices are going to go down.”

If there is good news, it’s on the buyer’s side. Pritchard said this is one the very best times to buy because of the large number of selection and the low interest rates on mortgages. “As a buyer you’ve got all kinds of choice to pick from: water-view, waterfront, big, small, everything in between, you’re going to get a really good deal on that.”