By Chad Ingram
The COVID-19 pandemic is having a big impact on Haliburton County’s real estate market, turning it red hot, with the number of showings and offers way up, and inventory barely keeping pace with demand.
With most of those buyers coming from Toronto and the GTA, local realtors are chalking the boom up to the coronavirus crisis, with people seeking refuge from the city by moving to more sparsely populated areas.
“A lot of buyers want out of the city,” says Linda Baumgartner, broker of record for RE/MAX’s The Haliburton Real Estate Team. “Our inventory is low, demand is high. That’s driving prices up.”
The story is the same across the county’s real estate brokerages.
“We’re seeing a lot of demand,” says Anthony vanLieshout, broker of record for Royal LePage Lakes of Haliburton, adding he had 30 showings for a cottage on Lake Boshkung the previous weekend, and saying that number of showings is not uncommon. “We had one this summer that had 50 showings on it.”
As for the trend of urbanites buying up rural properties amid the ongoing pandemic, “There’s a lot of comfort and security in it, I think,” vanLieshout says.
When the COVID-19 pandemic struck Ontario in mid-March, it meant a freeze in real estate activity that lasted into May.
“We lost the spring market, which is a very strong market,” says Andrew Hodgson, broker of record for Century 21 Granite Realty Group Ltd., adding it can make up as much as 40 per cent of sales for the year. “So originally, I thought a lot of it was pent up demand as much as anything.”
It then became apparent a wider urban exodus was taking place.
“COVID has for sure given us an unbelievable summer,” Hodgson says.
In terms of property values, in some cases, prices for waterfront properties are up more than 40 per cent from this time last year. Stats from the Ontario Collective, a group of 12 real estate associations throughout Ontario’s cottage country, suggests that from the third quarter of 2019 to the third quarter of 2020, values for waterfront properties are up by more than 48 per cent, non-waterfront properties by more than 11 per cent. It shows the number of sales of waterfront properties being up more than 50 per cent from last year, non-waterfront more than 21 per cent. In terms of sales volume, the collective value of properties, it shows waterfront up more than double – 115 per cent – with a collective value of more than $122 million for the third quarter of 2020.
While vanLieshout says he’s seen exceptional cases of waterfront properties up more than 40 per cent, he pointed to a cottage that last year was listed at $550,000, this year for $699,000, so about a 30 per cent increase in value, which he thinks is more indicative for the county, and notes is still huge. He also references a cottage on Redstone Lake that in 2018 was going for $2 million and is now selling for $3 million, for a 50 per cent increase in the span of two years.
Hodgson says for waterfront properties he’s seeing appreciation in the 30- to 35-per cent range over last year, and that many residential properties not located on water have appreciated by almost the same value.
“It’s everything; it’s on water and off,” says Baumgartner of the demand. In addition to new buyers seeking cottages, she adds that with the ongoing pandemic limiting people’s ability to travel, some people who may have been thinking of selling their cottages are hanging onto them so they have a rural place to escape to. These factors combined seem to be keeping supply consistently low.
“Never ever have I experienced a market like this,” says Baumgartner, who’s sold real estate in Haliburton County for almost 33 years. “ … Needless to say, our realtors are run off their feet.”
While it was a slow spring, “then we started rolling and June, July, August, and it just went through,” says Hodgson, who’s sold real estate in the county for 14 years. “We’ve had multiple offers like we’ve never seen, we had price increases on all products, we’re talking about vacant land, residential off water and on water.”
“We are full on now, it is a COVID rush,” Hodgson says, adding he’s had a number of buyers who are condo owners in Toronto who are looking to find space amid the pandemic. “We have a marketplace we haven’t witnessed before as realtors.”
VanLieshout has been selling real estate for 35 years, exposed to the industry through family going back to the early ’70s. He notes there have been boom and bust cycles in the county’s real estate market during that time, and on the global economy, notes, “As a general rule, it kind of goes in seven-year cycles.”
In the late ’80s, the real estate market in Haliburton County was strong, vanLieshout says, that followed by a plunge from 1990 to 1997 that saw properties depreciate by about 30 per cent. Then for a decade between 1997 and 2007, a boom saw local land values increase by 300 per cent. That was followed by a seven per cent dip following the 2008 recession, those values staying flat until 2015, when the county’s market started to heat up again, that trajectory then accelerated by the effects of the COVID-19 pandemic.
“What I haven’t seen are the low inventory levels,” vanLieshout says, noting they are the lowest of his career.
As of Oct. 2, his brokerage had 85 active listings for residential properties and 91 for vacant properties. Compare that to a year prior, when he had 279 active listings for residential properties and 129 for vacant lots. At one point a couple of decades ago, he had 1,000 listings on file.
As for how long the sizzling situation will last, it’s anybody’s guess.
“It all depends on how long this pandemic lasts,” Baumgartner says.
“That’s the crystal ball question,” says vanLieshout. “It’s not just Haliburton, it’s all of rural Ontario.”
Hodgson notes the trend of people leaving cities for less populated areas seems to extend south of the border as well.
“It’s a North American trend,” Hodgson says. “I’ve looked at stats in Wyoming, Montana … everybody’s leaving cities. I think it’s more than just COVID, COVID was the match lit, but there’s lots of trends that have been coming our way, to leave urban areas, boomers downsizing, etc.”
“The other trend,” Hodgson says, “and this is a key part, once employers figure out that employees can work from home . . . that is a real trend and that is a trend that is going to continue to sustain. This is not a blip, this is going to continue . . . I think it’s going to soften a little, but nevertheless, this idea of moving to Haliburton County is going to continue.”