{"id":29479,"date":"2024-05-22T06:00:00","date_gmt":"2024-05-22T10:00:00","guid":{"rendered":"https:\/\/www.zoocasa.com\/blog\/?p=29479"},"modified":"2024-06-05T09:56:24","modified_gmt":"2024-06-05T13:56:24","slug":"capital-gains-tax-impact-cottage-country","status":"publish","type":"post","link":"https:\/\/www.zoocasa.com\/blog\/capital-gains-tax-impact-cottage-country\/","title":{"rendered":"Capital Gains Tax Changes and an Improved Market: What Cottage Buyers and Sellers Need to Know"},"content":{"rendered":"\n

When the 2024 Federal Budget was announced in April, one change stood out to cottage owners: the capital gains inclusion rate was increased from one-half (50%) to two-thirds (66.7%). For those who own a secondary residence, like a cottage, this means that if you sell your secondary property after June 25, 2024, you will now be taxed about 66.7% of all capital gains above $250,000. <\/p>\n\n\n\n

But even before this change was announced, Ontario\u2019s cottage country was heating up for an active spring season. Home prices have increased markedly since January and new listings are flooding the market. So what\u2019s prompting this enthusiasm? We talked with local eXp real estate agent Karen Hanes<\/a> to better understand what buyers and sellers can expect this season. <\/p>\n\n\n\n

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Benchmark Prices in Ontario Cottage Country Rising Faster Than Major Markets<\/h1>\n\n\n\n

Zoocasa analyzed how benchmark home prices (which take all property types into account) for 11 markets in Ontario\u2019s cottage country have changed since January of this year, and found that all but one market has experienced price growth of over 6% in just four months. Notably, benchmark prices in Georgian Bay<\/a>, Tiny<\/a>, Lake of Bays, and Muskoka Lakes<\/a> have risen by over 11% since January 2024. In Muskoka Lakes, that equals a more than $140,000 increase, while in Lake of Bays and Georgian Bay, the increase exceeds $90,000. <\/p>\n\n\n\n

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Benchmark price growth in some of Ontario\u2019s cottage country is more than double that of other major Canadian markets. In Toronto<\/a>, for example, the benchmark home price increased by 5.9% from January, and in Vancouver<\/a>, it has increased by 3.8%. <\/p>\n\n\n\n

With that being said, more homes are on the market this year than last year, so that\u2019s keeping prices from skyrocketing. \u201cThe spring market is improving as people are optimistic,\u201d says Hanes. \u201cHomes are selling faster than last year, but it does depend on the house. If it\u2019s overpriced, it\u2019s going to sit, however, if it\u2019s priced right it won\u2019t linger on the market for too long.\u201d <\/p>\n\n\n\n

Focusing on waterfront properties tells a slightly different story. Though the median price for all waterfront properties in the Lakelands has increased since January, by 6.2%, year-over-year the price has dropped by 1.9%. In Lakelands Central (which includes Midland<\/a>, Orillia<\/a>, Oro-Medonte<\/a>, Penetanguishene, Ramara<\/a>, Severn, Springwater<\/a>, Tay, and Tiny) and Lakelands North (which includes Algonquin Highlands, Bracebridge<\/a>, Dysart et al, Georgian Bay Township, Gravenhurst<\/a>, Highlands East, Huntsville<\/a>, Lake of Bays, Minden Hills<\/a>, Muskoka Lakes, Parry Sound<\/a>, and The Archipelago), the median price has dropped year-over-year by 4% and 0.7% respectively. In Lakelands West (which includes Clearview<\/a>, Collingwood<\/a>, Grey Highlands, Meaford, The Blue Mountains<\/a>, and Wasaga Beach<\/a>), which has much fewer properties on the market, the median price of waterfront properties increased by 16.1% to $905,000. <\/p>\n\n\n