According to a new survey by Royal LePage, Canadians factor interest rates into their decision to buy a recreational property in a big way.
Most, or 82 per cent, of Canadians say that interest rates will influence their decision to buy a recreational property like a cottage, while 58 per cent of Canadians feel a sense of urgency to buy now because of low interest rates.
“Despite financial and economic uncertainty, or perhaps because of it, we have found that the enduring value of recreational properties is widely-recognized by Canadians,” said the president and chief executive of Royal LePage Real Estate Services, Phil Soper. “In contrast to our large urban centres, where home prices shot up in recent years before cooling rapidly in 2013, the recreational property market has remained remarkably stable and resilient.”
About 50 per cent of Canadians feel that prices will increase in the coming year, while 32 per cent said they think that they will stay the same. In addition, 76 per cent said they would be looking to buy in Canada as opposed to elsewhere, like the United States.
“I shy away from recommending real estate as an investment for the typical family,” Soper continued. “Shelter is, after all, primarily consumption. However in Canada today, where we see virtually no return on bonds or other forms of modest risk savings, it is reasonable to view recreational property in a new light. This prolonged low-interest environment supports purchase decisions based upon lifestyle and supported with a sound investment thesis.”
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