CANMORE – The value for recreational properties in Canmore increased between 9.8 per cent and 14.5 per cent year-over-year, the largest increase in Alberta and among the highest appreciation in value across the country.
The average price for a riverside recreation home is now $3.15 million, while the average price for a non-waterfront property is just over a million dollars, an increase of 13.2 per cent, according to a report by Royal LePage.
That same report stated the average price for a recreational condo jumped by 14.1 per cent to $365,000, while the average recreational townhouse is now $675,000.
The increase in value was largely driven by the lack of new units, according to Frank Kernick, president of Spring Creek Mountain Village.
“The entire Canmore market right now is a sellers’ market, because we have very little supply,” said Kernick.
From 1997 to 2007, he said, developers were building an average of 450 homes a year; however, when the recession hit in 2008, development nearly ground to a halt.
“We went from a steady, fairly rapid growth to zero growth in the Bow Valley and Canmore,” said Kernick, explaining there were less than 30 new homes being built per year during the recession.
Compounding matters, Canmore suddenly found itself with an over supply of vacation homes and no one to buy them, leading to a downturn in prices.
Today, things have turned around with Canmore leading the way across the province.
“The last three years tourism has taken off because of our dollar,” said Kernick, adding housing starts are only half of what they were prior to the 2008 recession.
He pointed to several other factors driving up prices, including British Columbia’s new speculation tax on secondary homes.
“B.C. is a scary place to invest right now for vacation properties because the government imposed a non-resident tax of one per cent per year,” said Kernick, explaining about 80 per cent of prospective buys in Canmore are from the regional market.
South of the border, he said, Canadians who bought vacation homes during the recession in places like Arizona and Phoenix are also beginning to sell those properties and reinvest their money in places like Canmore.
According to Royal LePage, the average recreation property in Alberta rose by 8.9 per cent year-over-year to $770,000. In Canada, the average recreation property increased to $468,000, an increase of 5.8 per cent.