The pandemic is driving some curious real estate trends as a combination of working from home and restrictions on travel is driving people to look at more rural areas. The demand for locations off the beaten path has led to bidding wars in cottage country that many agents have rarely seen.
Billy Wilson and Rachel Carl live in Delhi, about an hour’s drive east of London. Like many, the couple have been looking for a cottage to get in touch with nature. The trouble is, they’re not alone.
“There’s a lot of people interested in the same idea that we have,” said Wilson, noting the couple had looked at close to a dozen cottages, only to find bidding wars on each one.
They put in an offer on one location, only to lose it by being outbid by just $1,500.
“I was heartbroken,” said Wilson.
Wilson and Carl were finally successful in their search for a cottage, buying on a lake outside of Bancroft. While that cottage was also the subject of a bidding war, they were successful without the highest bid. Their secret? Developing a relationship with the cottage’s original owner.
“She really wanted someone to carry on what her and her husband had with the place,” said Wilson.
While the circumstances with their successful sale may be unique, Wilson and Carl’s experience with a frustrating search isn’t in the age of COVID-19.
Jill Price is an agent with Re-Max All Stars, covering a region spanning from the Kawarthas to Bancroft. When the pandemic began, she said there were major concerns about the market, as things slowed down. When northern regions were reopened sooner than Toronto, Price said things quickly changed.
“They all started coming up here,” said Price. “What I’m noticing is retirees actually taking retirement early and moving up here full-time.”
Price is also noticing an influx of younger couples in their early 30s who are working from home, choosing to make their home office next to a lake.
Price said that in 2017, there was a similar boom in cottage real estate, but “it’s crazier now than it ever has been.” Most cottages, she said, are selling with between five and 10 offers, which means they’re selling about $50,000 to $100,000 over the asking price.
The cottages themselves are already listed on the market for about $500,000 she said, with the bidding wars adding about a 10 per cent increase. And that, Price noted, is what gets the average buyer a rustic, traditional cottage. She said the starting price point was around $350,000, but those locations don’t have year-round road and water access, or the best swimming features.
While there has been a large influx of urban buyers as a result of the pandemic, Price thinks the trend could just as easily reverse in time.
“Some of these people might get bored and we might see them migrate back to the city in a couple of years,” she said.
While the cottage country market has seen a boost in unusual sales activity, the Toronto real estate market is also experiencing some trends agents find surprising.
Veteran agent Jennifer Scaife with Re-Max Hallmark said homes with a pool, traditionally “stigmatized” on the Toronto market, are now being sold extremely quickly with multiple offers.
“Pools, they’re high-maintenance, they’re expensive to maintain, you have to have extra insurance on the house,” said Scaife. “So I’m very surprised to see that.”
The change in Toronto has been driven by the clampdown on city amenities during the pandemic.
“If you can’t go to the pool and you can’t go to Disney World, people are doing it in their backyard,” said Scaife.
Scaife also said many of those working from home are looking for properties with more space both inside and out.
“That also translates to more bedrooms,” said Scaife. “So couples, who are now working from home, they each need their own office space as well as private space for the whole family to be.”
She also noted many of the buyers she’s seeing are younger and first-time homeowners, who have a perception that there is a deal to be found.
“It’s not necessarily a lower price, but the perception is there enough to drive buyers coming out,” said Scaife.