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A large luxury home and boathouse sit on a lakeshore in Ontario cottage country. The scene is beautiful, but oh so expensive.Heading up to the cottage for the weekend. That’s the magical dream for so many people down in Toronto and the rest of the Golden Horseshoe. To escape the noise and bustle of the everyday to your gorgeous, quiet home overlooking a placid powder blue lake as the northern lights dance overhead…


Whoa, there! Wake up! Snap out of it!


Sorry to tear you away from your happy place, but it’s not real. Not yet, at least. If you want to see your plans for a cottage up north come to life, you’ll have to get realistic about the cost very quickly.

 

A couple (with their infant) talk to their financial advisor to learn what cottage property than can afford and how they can pay for it.

To put it bluntly: a cottage is a whopper of an investment. Which doesn’t mean you shouldn’t follow through on your dream. You just need to be realistic and, most importantly, do your homework.

 

Whether realtor, mortgage broker, or current owner looking to sell their property, each one can give you a good idea of the annual cost and expenses you’ll need to take on. Once you have those numbers, ask yourself if you can afford it.

 

According to Royal LePage, the average 2017 price of a lakefront recreational property in the Kawartha Lakes region is $550,000, while the same type of house in Muskoka goes for an average cost of about $1.5 million (for comparison, a riverside house would cost $350,000 and $800,000, respectively) And keep in mind, that’s before you include the cost of tax, Internet and TV, routine maintenance, winter road ploughing, and – if you got that lakefront spot so you can kick back on your boat – marina fees.

 

A boathouse sits on a lake in Ontario cottage country, down from a luxury home, just barely visible in a corner of the image.

Tax and maintenance – because there’s always something that will need to be taken care of on your property – will tack on several thousand dollars a year. Consider how many nights you’ll be spending at the cottage every year. Would you be willing to spend $200 a night in these costs, every year? Make sure you put your purchase into these more approachable frames of reference.

 

Remember that you’ll still have to deal with the rising annual costs at home, too. Property taxes, utilities, insurance: These rates tend to rise year over year, so factor in these costs when considering taking on the additional investment of a cottage.

 

There’s also routine and unforeseen maintenance to keep in mind. Especially with regard to the latter variety, it’s essential to set aside a rainy day fund for when your roof springs a leak.

 

A construction worker repairs roof shingles on a cottage, as part of routine maintenance.

Once you’ve crunched all these numbers and decide you’re ready to invest in a cottage, there’s another factor to bear in mind. Based on how large your down payment is, there’s a good chance you’ll have to take out mortgage insurance, too.

 

While the list of considerations is long, there’s really no getting around them. A second home in cottage country is an investment you’ll need to plan accordingly for, lining up your assets and budgeting for unexpected issues that can’t be avoided despite your best efforts. The financial investment might large, but so is the emotional one. And the payoff is even greater.

 

Speaking of which, there are plenty of reasons we love to build luxury homes in Ontario cottage country. Let us tell you a few!

 

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