Cottage country homes in Ontario are experiencing longer listing times than usual, reflecting broader trends of cooling in Canada’s recreational real estate market. A shift away from the intense demand seen during the pandemic has led to a more balanced and cautious environment for both buyers and sellers.
Analysts suggest the urgency that defined the market during lockdowns—when remote work and travel restrictions fueled a surge in vacation home purchases—has now eased. With more economic uncertainty in 2025, buyers are proceeding more cautiously, and sellers are adjusting to a less aggressive market.
Prices have moderated in many regions, with some areas in Ontario seeing declines of over 20 per cent since 2024. Inventory levels remain steady, with expectations of increased listings during the summer months. Approximately 40 per cent of cottage markets may experience further price drops, though the remaining 60 per cent could see modest increases due to lingering demand and limited available properties.
After years of double-digit price growth, property values in the recreational market have generally stabilized, settling slightly below previous peaks. In Ontario, the median price for a single-family recreational home fell 1.5 per cent last year to $640,700, while condos declined by 5.7 per cent to $468,900. A marginal recovery is anticipated in 2025, with forecasts predicting a one per cent increase in single-family home prices and a 1.8 per cent rise nationally.
Despite increased inventory in some regions, demand has not significantly rebounded, even with lower interest rates. Additionally, regulatory restrictions on short-term rentals in certain areas may be discouraging investment in vacation homes.
Survey data indicates that nearly one in five Canadians planning to sell a recreational property within the next year no longer sees it as a strong investment. This shift in sentiment underscores the changing dynamics of the cottage real estate market as it moves away from the volatility of recent years.