2011 has been an uneven year. The early months of the year dramatically underperformed the same period in 2010. There were a number of national and international economic matters that affected the market place, as well as a long and difficult winter that made viewing recreational properties difficult and unappealing. Winter lasted into early May, but as weather conditions improved, and Buyers could once again access properties, sales began to take place, resulting in dramatic improvements in the number of reported sales by the Muskoka and Haliburton Association of Realtors.
Unfortunately, the worlds and our economic concerns, continued to plague Buyers of recreational properties and particularly in August when sales once again dropped off substantially. The US economy and debt, the European Economic Unions problems and a slowing economy in China caused Buyers to reconsider purchases, and this was reflected in the number of reported sales. Ironically and unexpectedly sales ?rebounded in September, particularly on the big Muskoka Lakes. Last year 22 sales were reported in September, this year there were 26.
On a year-to-date basis the market has performed as follows. On the Muskoka Lakes there were 182 recreational properties reported sold to the end of September. When compared to 2010. In 2010 over the same period there were 195 sales, a decline of a little more than 6 percent. It is obvious that the numerous issues that have been affecting world economies and the equity markets have impacted sales. Although May, June, July were strong sales months, August sales sagged, bringing the overall Muskoka Lakes numbers down. Lake of Bays finished the third quarter marginally down from the same period last year. As at the end of September 63 recreational properties were reported sold. Last year over the same period of 65 properties were sold.
Overall for all recreational properties sold and reported by the Muskoka and Haliburton Association of Realtors as compared to 2010, the market continues to underperform, although not nearly as negatively as in the early months of this year. At the end of September 612 recreational properties were reported sold throughout the region. This compares to 679 for the same period last year, a decline of 9.8 percent. This means that both the Muskoka Lakes (6 percent) and Lake of Bays (marginal decline) out performed the other trading areas of the Association.
Over the last quarter inventories of recreational properties have continued to increase, surpassing last years level of available properties. On the Muskoka Lakes 329 recreational property listings were processed during the first nine months of 2011. This compares to 319 for the same period in 2010, an increase of 3 percent. At the half way point in the year listing inventories were 3 percent below those available last year. In the case of Lake of Bays, inventory levels were marginally down, from 142 new listings in 2011 as compared to 145 last year. The overall recreational market place as reported by the Association saw more significant increases in available properties. Last year the Association processed 1161 new listings. During the first nine months of 2011 it processed 1244, an increase of 7.1 percent. As in the case of sales, both the Muskoka Lakes and Lake of Bays have not been entirely in lock-step with the overall market place.
Chestnut Park continued to increase its market share during this reporting period. Its Sales Representatives performance was more than 200 percent better than its nearest competitive real estate office.
The available statistics make it clear that the recreational market remains unstable, influenced by many economics factors, many of which are neither local, or even national. Uncertainty in global equities, the Euro, the American debt crisis, and now a slowing Chinese economy will continue to impact the Muskoka Lakes and Lake of Bays as these markets represent discretionary purchases. If transactions are not driven by need, as is often the case in urban environments, and Buyers are concerned about global economic issues, then pricing will be the key to sales. Overpriced properties will simply remain unsold. Looking forward it is not anticipated that the global issues will be soon resolved. As a result 2012 may see a repeat of the 2011 market. Needless to say we will reexamine the market each quarter in order to detect any changing trends.
Prepared by: Chris Kapches, Vice President and Legal Counsel
Lesley-Anne Goodfellow