Whether you are an owner of a cottage who is considering selling, or a prospective buyer, it is important to be as informed as possible on local market conditions. In my previous career as a managing director at a major Canadian financial institution, I developed a deep appreciation for the importance of sound analytics, and have applied these concepts to glean insights on broader market trends as well as individual property valuation. In an effort to promote greater transparency and efficiency in our local markets, I am pleased to provide statistics and commentary on each of the major lakes in our core service area. If you are interested in a more precise valuation of your property, please contact me at (705) 438-3000 or email me and I would be happy to provide a value estimate at no cost.
~ David Donais, Broker of Record/Owner
2023 Balsam Lake Market Value Summary
The 12 major western Kawartha waterbodies include Balsam, Cameron, Canal, Crystal, Dalrymple, Four Mile, Head, Mitchell, Pigeon and Sturgeon lakes as well as the Shadow Lake System and the Burnt River.
- The metric I use to track price trends is the Sale Price-to-MPAC Assessed Value Ratio, which is simply the
ratio of the sale price of an individual property to its MPAC assessed value. I calculate this ratio for each
sale recorded, as well as an average ratio for all sales in each time period.
- The chart above summarizes the average Sale Price-to-Assessed Value Ratios for the almost 1,100
waterfront sales across the 12 major waterbodies in the western Kawarthas since January 2020.
This chart effectively tells the story of the pandemic market and its aftermath.
- Prices were choppy in 2023, rising early in the year, falling with the onset of the banking crisis in March,
and weakening further in the summer and early fall after the resumption of interest rate increases by the
Bank of Canada. Prices rebounded late in the year once fears of additional rate increases receded.
- Notwithstanding the unwinding of the pandemic-induced bubble, price levels remain 67% above 2019 levels.
- Sales activity on Balsam Lake was subdued in 2023, with only 12 sales compared to 25 sales in 2022
and 33 sales in 2021.
- Sale prices for the 12 sales in 2023 ranged from $750,000 to $2,575,000. The average sale price of
$1,243,000 was down substantially from $1,976,000 in 2022 and $1,524,000 in 2021.
- The average Sale Price-to-Assessed Value ratio for the 12 sales in 2023 was 2.08, materially lower than
the average ratio of 2.39 for waterfront sales across the western Kawarthas in 2023. This underperformance
was attributable primarily to the fact that many of the sales on Balsam Lake were lower quality properties
with older buildings and/or poor waterfront.
- Looking forward, I am cautiously optimistic that prices will improve in 2024 as my sense is that many
buyers feel ready to re-enter the market now that the interest rate increase cycle appears to have ended.
2022 Balsam Lake Market Value Summary
Western Kawartha waterbodies include Balsam, Cameron, Sturgeon, Pigeon, Canal, Mitchell, Dalrymple, Head, Four Mile and Crystal lakes as well as the Shadow Lake System and the Burnt River.
- The chart above summarizes the monthly average Sale Price-to-Assessed Value Ratios in 2022 for the 12
major waterbodies in the western Kawarthas as well as across the entirety of cottage country. I have
included the broader cottage country metric as the larger number of sales in this database adds credibility
to the trends. For example, there were only three sales in the western Kawarthas in December 2022 so I
would not put much faith in the 2.14 metric for that month.
- Prices reached an all-time high in the early months of 2022 as buyers with pre-approved financing at very
low rates chased the few waterfront listings on the market. The result was fierce bidding wars and sale
prices substantially over asking. Buyers became extremely cautious once interest rates started to increase
in late spring, and prices fell materially throughout the summer months before stabilizing in the autumn.
Notwithstanding this retrenchment, price levels in December 2022 remained 62% above pre-pandemic levels.
- There were 25 cottage property sales and 3 vacant lot sales on Balsam Lake in 2022, versus 33 cottage
sales and no lot sales in 2021.
- After May 31st only 12 of the 26 active cottage listings sold, with sale prices averaging $289,000 (11%)
under the original asking price.
- The average sale price-to-assessed value multiple for the 25 cottage property sales in 2022 was 2.48,
lower than both the 2.75 average multiple realized across the western Kawarthas and the 2.65 multiple
realized across cottage country. The lower average multiple for Balsam Lake was reflective of the fact
that there was a much higher proportion of high-end (i.e. above $2 million) sales on Balsam Lake than on
other lakes. There was less of a buying frenzy for these properties in 2022.
- The average sale price of the 25 cottage property sales was $1,976,000, up 30% from $1,524,000 in
2021. Sale prices ranged from $590,000 to $4,500,000.
- It is difficult to predict how prices will evolve over the next 12 months but my sense is that we will return
to normal market conditions with relatively stable prices once the rate increase cycle ceases.
2021 Balsam Lake Market Value Summary
*Incorporates sales on Balsam, Cameron, Sturgeon, Canal, Mitchell, Dalrymple, Head, Shadow and Four Mile lakes as well as the Burnt River.
- The chart above summarizes the average Sale Price-to-MPAC Assessed Value Ratio for the 570
waterfront sales across the key waterbodies in the western Kawarthas since January 2020. This chart
is the most effective measure of waterfront price trends due to the large number of data points and
the fact that average sale price-to-assessed value ratios tend to be quite consistent across the major
waterbodies in the western Kawarthas.
- Waterfront prices continued to trend higher through 2021 and ended the year at historic highs and
almost double 2019 levels as pandemic-induced demand reached unprecedented levels. The only
interruption in this upward trend occurred in July and August of 2021 when buyer demand receded in
the expectation that the pandemic would soon be over following the wide vaccination rollout. Demand and prices quickly bounced back once the Delta and Omicron variants emerged.
- Price trends on Balsam Lake mirrored the broader western Kawarthas trend with prices increasing
materially in the latter months of 2021 following a summer price slump.
- The average sale price on Balsam Lake in 2021 was $1,524,000, up 34% from $1,138,000 in 2020.
Sale prices ranged from $580,000 to $5,850,000, which was an all-time high sale price for a waterfront
property on Balsam Lake.
- There were 33 sales on Balsam Lake in 2021, down from 43 sales in 2020 but in line with 33 sales in 2019.
- 22 of the 33 sales in 2021 exceeded $1 million in value and 5 sales exceeded $2 million.
- Only 12 of the 33 sales sold for a below-asking sale price, reflective of the dominant strategy of setting
an attractive list price and holding back offers in the hope of receiving multiple offers and an above-
asking sale price.
- Looking forward, it is difficult to foresee any material reduction in buyer demand and prices in the
coming year unless we see the cessation of the pandemic and a return to pre-Covid living conditions
and/or materially higher interest rates.
2020 Balsam Lake Market Value Summary
- Waterfront market activity on Balsam Lake and across the western Kawarthas was especially volatile
throughout 2020. It is therefore necessary to analyze the sales data on a monthly basis in order to
understand the underlying price trends.
- The metric I use to track price trends is the Sale Price-to-MPAC Assessed Value Ratio, which is simply
the ratio of the sale price of an individual property to its MPAC assessed value. I calculate this ratio for
each sale recorded, as well as an average ratio for all sales over a given time period. I consider the
extent to which the average changes over time a good proxy for waterfront price trends.
- The charts above summarize the average Sale Price-to-Assessed Value Ratios for each two-month
period in 2020. I have included a chart for both Balsam Lake and the entire western Kawarthas as the
latter incorporates a larger number of sales and is therefore more statistically significant. You can see
that prices were strong in the first two months of 2020, slumped somewhat during the lockdown
months, and increased substantially thereafter (the Jul/Aug ratio for Balsam Lake would be 1.61 if a
single high value/low ratio sale was excluded). Most astounding are the post-September 1st results,
which saw an additional upward surge in prices from the summer. The 1.98 ratio realized from
November and December sales on Balsam Lake is indicative of a 41% price increase from 2019, when
prices were mostly flat throughout the year.
- This increase in prices is attributable primarily to the tidal wave of new demand from buyers in the GTA
who are eager for an escape from the pandemic-induced stresses of urban living.
- The average sale price for Balsam Lake properties in 2020 was $1,138,000, up 37% from $829,000 in
2019.
- The 43 sales on Balsam Lake in 2020 were up from 33 sales in 2019 and only 17 in 2018.
- Looking forward, I am optimistic that 2021 will continue to be positive for the waterfront market,
supported by the apparent seismic shift in buyer demand towards waterfront properties, continued low
interest rates and relatively strong real estate markets in the GTA.
Balsam Lake Market Value Update ~ August 31, 2020
Balsam Lake Market Value Update ~ July 31, 2020
Balsam Lake Market Value Update ~ June 30, 2020
Balsam Lake Market Value Update ~ April 30, 2020
Sluggish start to 2020
- There have been 11 new listings and 3 sales so far on Balsam Lake in 2020, a similar start to the very slow 2018 season. Most of the new listings consist of properties that were on the market last year and did not sell.
- Two of the three sales were seasonal cottage properties.
- The Covid-19 crisis has resulted in a significant slowdown in both listings and sales across the western Kawarthas, leading to great uncertainty in the market going forward. At the present time there is no evidence of falling prices for waterfront properties and sellers are for the most part holding firm to their asking prices. The emerging trends of working from home and cottage vacationing as a replacement for air-travel vacations bode well for demand in the medium term, while the impending recession/depression represents a threat to short-to-medium term valuations.
2019 Balsam Lake Market Value Summary
- 53 waterfront properties were put on the market on Balsam Lake in 2019 and 33 (62%) sold. Nine (27%)
of the sold properties required one or more price reductions. The number of sales in 2019 returned to
normal levels after the unusually low level recorded in 2018, where 34 properties were put on the
market and only 17 sold.
- The average sale price of $829,000 was down 9% from $907,000 in 2018. This decrease in average sale
price was attributable primarily to a higher proportion of lower priced seasonal cottages in the sales
mix than in the previous year.
- One metric I track closely to provide insight into pricing trends is the Sale Price-to-MPAC Assessed
Value Ratio. I calculate this ratio for each sale recorded, as well as an average ratio for all sales during
the year. In 2019, the average ratio for the 33 Balsam Lake sales was 1.40, up 6% from the ratio of 1.32
realized in 2018. The average ratio for all 185 waterfront sales across the 10 key lakes we track across
the western Kawarthas was 1.44, up 3% from 1.40 last year.
- Waterfront properties on Balsam Lake in general took much longer to sell in 2019 than in the previous
two years, with a median number of days on the market of 66 versus 36 in 2018 and 21 in 2017.
In contrast, the median number of days to sell waterfront properties across the western
Kawarthas was stable year-over-year at 47.
- Looking forward, I am cautiously optimistic that 2020 will be a positive year for the waterfront market.
I noticed strong momentum in the fall months – almost half of Kawartha Waterfront Realty’s 2019 sales
took place after September 30th, and buyer inquiries to our office have remained strong in the early
winter months. Real estate market conditions in the GTA also appear to be improving, which helps fuel
demand for waterfront properties.
Balsam Lake Market Value Update ~ October 15, 2019
Balsam Lake Market Value Update ~ August 31, 2019
Balsam Lake Market Value Update ~ July 31, 2019
Balsam Lake Market Value Update ~ June 30, 2019
Balsam Lake Market Value Update ~ May 31, 2019
Balsam Lake Market Value Update ~ May 15, 2019
2018 Balsam Lake Market Value Summary
- The average sale price was $907,000 in 2018, down 4% from $945,000 in 2017.
- There were only 17 sales in 2018, a near-historic low for the lake.
- One metric I track closely to provide insight into pricing trends is the Sale Price-to-MPAC Assessed
Value Ratio. I calculate this ratio for each sale recorded, as well as an average ratio for all sales during the
year. In 2018, the average ratio for the 17 Balsam Lake sales was 1.32, virtually unchanged from the ratio of 1.34 realized in 2017. The average ratio across the six key lakes in our region (Balsam/Cameron/
Sturgeon/Four Mile/Shadow/Head) was 1.38, unchanged from 2017. These ratios support my belief
that waterfront prices were stable year-over-year.
- Waterfront properties took much longer to sell in 2018 – the median number of days on the market
for properties sold on the six key lakes in our region was 48 days, more than double the 2017 median
of 23 days. On Balsam Lake, the median was 36 days in 2018 versus 21 days in 2017. My explanation
for this increase is that buyers from the GTA who had experienced a double-digit percentage decline
in their home values were expecting similar declines in cottage prices in 2018. Cottage sellers, on the
other hand, were not willing to reduce prices in line with GTA trends as a result of their belief that
“bubble” conditions were not evident in our market. This gap in pricing expectations lengthened the
time period required to sell waterfront properties and, in the case of Balsam Lake, contributed to the
relatively low number of properties sold in 2018. This gap was ultimately resolved in favour of sellers,
as evidenced by stable year-over-year prices.
- Other key takeaways from the 2018 market include:
- The waterfront selling season started very slowly in the western Kawarthas but picked up momentum
as the season progressed. The post-September 1st market was very strong. On Balsam Lake, three
properties sold prior to June 1st, while six were sold after September 1st.
- Buyers almost uniformly desire to use their cottages year-round – if you have a three-season
property, it would be well worth your while to investigate the feasibility of enhancing it to four-
season capability.
- Looking forward, I am hoping that the strong momentum from the fall 2018 market will carry into 2019.
However, while the prospect of higher interest rates in 2019 appears to be receding, the late-2018
correction in financial markets has the potential to impact buyer demand for waterfront properties.
As always, real estate market conditions in the GTA will heavily influence our market.
Balsam Lake Market Value Update ~ October 15, 2018
Slow fall market.
- There have been only two post-Labour Day sales on Balsam Lake in 2018 to October 15th, versus five in the same period last year. This slow sales activity is a continuation of the trend that has been evident through most of the 2018 season.
- The average sale price for the 12 sales so far in 2018 is $886,000, down from the $945,000 average for all sales in 2017. The average Sale Price-to-MPAC Assessed Value ratio for the 12 sales so far this year is 1.27, down slightly from the 1.34 ratio realized for all sales in 2017.
Balsam Lake Market Value Update ~ August 31, 2018
Balsam Lake Market Value Update ~ July 31, 2018
Balsam Lake Market Value Update ~ June 30, 2018
Balsam Lake Market Value Update ~ May 31, 2018
Balsam Lake Market Value Update ~ May 18, 2018
- Since April 30, there have been five new listings and no additional sales on the lake, confirming the trend of a much slower start to the year on the lake. On a year-to-date basis (Jan. 1/18 – May 18/18), total sales volume on the lake is only $1.2 million, down significantly from $10.4 million for the same period last year.
Balsam Lake Market Value Update ~ April 30, 2018
- We have witnessed a much slower start to the spring season than last year. Since Jan. 1, 2018, there have been seven new listings and only two sales on the lake. Last year during the same period there were 11 new listings and nine sales. This trend is consistent with what we are seeing on Sturgeon Lake.
- The slower start is most likely the result of a combination of poor spring weather and more balanced market conditions in comparison to the very robust seller’s market last spring.
- The two sales so far this year were both below $750,000 in value. Last year four of the nine sales were for properties valued at more than $1 million.
- Another factor likely resulting in lower sales activity is that asking prices are relatively high. As noted in the 2017 summary below, the average sale price to assessed value ratio for all waterfront sales on Balsam Lake in 2017 was 1.34. In other words, the sale price for a given property was, on average, 1.34 times that property’s 2016 MPAC assessed value. For the eight active listings (excluding condominiums) on Balsam Lake as at April 30, 2018, the average asking price to assessed value ratio is 1.71. In other words, the asking price for a current waterfront listing on Balsam Lake is, on average, 1.71 times that property’s 2016 MPAC assessed value. This difference in today’s asking prices versus last year’s sales prices may well be leading potential buyers to balk at paying these higher asking prices, especially given the year-over-year declines in prices they are familiar with in the GTA.
2017 Balsam Lake Summary
- The average sale price on Balsam Lake was $945,000 in 2017, up 16% from 2016.
- Thirty-two properties were sold in 2017, down significantly from the record high level of 55 in 2016.
- Market dynamics on Balsam Lake (and all of the western Kawarthas) were influenced by events in the GTA housing market. The spring market was especially frothy, with large numbers of buyers competing for relatively few listings.
- Cottage buyer interest receded somewhat after the imposition of the foreign buyer tax in the GTA. Mid-priced cottages (up to $700,000) continued to sell quickly, however, while sales of higher priced cottages slowed considerably.
- The trend to higher market values on Balsam Lake was supported by another metric we track closely – the Sale Price to Assessed Value Ratio. In 2017, the average ratio for Balsam Lake was 1.34, a 16% increase from the 1.16 ratio realized in 2016.
