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Should You Buy a Cottage?

May 30, 2013
2 mins
An older couple walk hand in hand in the woods

As warmer weather drives urban dwellers to their seasonal escapes, you too may feel inclined to snap up your own little slice of heaven beyond the cell tower limits. But be forewarned; there are plenty of things to consider before investing in a recreational property.

First and foremost, can you really afford to buy a cottage?

“I do not think there is ever the right time to buy a cottage unless it is when you are most comfortable financially,” says Bruce Switzer, manager of the East Kawarthas, a popular Northern Ontario cottage destination, for Royal LePage Frank Real Estate.

Low Interest Rates Lead Buyers To The Lake

In mid-May, Royal LePage released a survey of Canadians who currently own or plan to buy a recreational property within the next five years. The poll found 82% of Canadians say interest rates will influence their decision to purchase a cottage – with 58% feeling the urge to act now while interest rates are low.

In terms of recreational property prices, half of the respondents say they expect them to increase while 32% expect them to stay the same.

“From a financial perspective, in the last two years the cottage values have pretty much levelled off,” says Switzer. “Ten years prior to that, we have had an increase in value pretty much every year, some years more than others, and we anticipate that the values will start to increase again shortly as real estate always seems to go in cycles.”

Know Your Nature

From a time-of-year perspective, Switzer says to avoid purchasing too early in the season unless you know the lake you’re purchasing on.

“The waterfront may look weed-free shortly after the ice goes out in the spring but a short time later as the water warms up you may start to see weeds,” says Switzer. “I would certainly recommend that you use a local realtor who knows the area so as to advise the good and not so good areas.”

The Perks of a Permanent Getaway

Owning a cottage certainly has an upside, says Switzer.

“The obvious benefit is that you have a location to go to anytime you want a little downtime,” he says adding that the benefits come with some hidden costs. “When we go on vacation and unwind, we tend to eat too much and drink too much and there are always toys to purchase for either ourselves or our children.”

He recommends adding an additional 33% to your budget “to cover the extras.”

Looking to take to the lakes? Expect to throw down even more cash to maintain a boat.

“When you have a cottage there are always lots of extra toys required to really enjoy your vacation,” says Switzer.

Andrew Seale

Andrew Seale is a freelance writer with an absurdly hyperactive mind and predilection towards the obscure and eclectic. He frequently shares his personal finance experiences and mishaps with TheDot readers but has also been known to profile business leaders ranging from financial savants to bootstrapped entrepreneurs. His work has appeared in the Globe and Mail, Yahoo Canada Finance and News, Profit Magazine, The Toronto Star, Enroute Magazine, and on the back of napkins sometimes tucked into the pockets of strangers. He can be found at

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