Survey predicts recreational property prices will slump in B.C.

A national survey done by Royal LePage is predicting the price of B.C. recreational properties will slump slightly by the end of the summer.

It blames the expected price drop on recreational homes of 2.8 per cent (compared to last year) on the new speculation tax, despite many popular vacation areas being exempt from the tax.

“While activity will continue to flourish in areas that are exempted from the new tax, like the Gulf Islands, regions that are not will stagnate, especially when farther away from the majority of city centres,” Adil Dinani, Royal LePage real estate adviser, said in a media release.

However, the same report predicts the prices of recreational property in the Okanagan Valley, where some communities are covered by the speculation tax, will rise.

It’s expecting the price of lakefront properties to rise 6.3 per cent compared to last year, while the price of non-waterfront property and resorts or condos to rise 6.9 per cent and 7.8 per cent, respectively.

“We are going to see a fairly flat line, maybe a bit of a bump here in the Okanagan,” said Kelowna real estate agent Mark Walker.

The province is defending the speculation tax, saying it is aimed at tackling housing affordability.

The Ministry of Finance said in a statement that the tax is part of the provincial government’s larger housing plan and that tax “targets foreign and domestic speculators who are driving up prices and holding vacant properties.”