Prices down 10 to 20 per cent from 2008
Derrick Penner
Sun
B.C.’s recreational property markets are in the midst of a correction, says a new report from a major realty firm, but a generational shift is occurring in the sales that are taking place.
Sales in 2009 are running off the pace of a year ago, with prices down 10 to 20 per cent depending on product type and location, Re/Max said in its annual recreational property report released Tuesday.
However, the falling prices helped draw so-called Generation X buyers — those born between 1965 and 1980 — into the market in a bigger way.
The evidence is anecdotal, based on a survey of Re/Max offices. But Elton Ash, executive vice-president for western Canada, said the market is now split about 50-50 between baby boomers and Gen Xers, compared with a year ago, when the younger demographic made about 20 per cent of recreational purchases.
“I think the reasoning behind that, more than anything, is that a lot of boomers have taken a hit on investments,” Ash said. “The country’s wealth is still focused in that demographic, but they’re feeling a little hurt right now.”
Generation X, however, after being priced out of the market for most of the last decade, hasn’t been stung as badly, and Ash surmises that more of its members are employed in more secure sectors of the economy such as technology.
That, Ash said, is reflected in the types of recreational properties that are in demand — less expensive family-oriented second homes — and in the sectors that have suffered the steepest price declines — waterfront and high-end properties.
“What Gen X is looking for is cheaper properties, so what’s happening is that the lower price point isn’t seeing the softening that the more expensive [homes] have seen,” Ash said.
In B.C., baby boomers still dominate the market in higher-priced locations such as Saltspring Island and Tofino. But Gen Xers are wielding more influence in the Okanagan, according to the Re/Max report, and becoming more of a presence in the surf mecca of Tofino.
Entry-level prices for most markets have dropped considerably in most markets. According to the Re/Max report:
– An oceanfront Ucluelet home would start at $555,000 this year, compared with a $649,000 price point a year ago.
– Tofino’s oceanfront would start at $789,000 this year compared with $869,000 a year ago.
– In the south Okanagan, the entry point would be $800,000 compared with $1 million a year ago.
– In the Central South Cariboo, seasonal properties can start in the $135,000 range, compared with $140,000 a year ago.
© Copyright (c) The Vancouver Sun
