Peak season: June to September
Best Buy: Old homes/Bed and Breakfasts
Average house price: $213,032
Average rent (high-end) $5,000 a week
Stunning vineyards, warm weather, shopping, golf and a thriving theatre scene – no, we’re not talking about California. All of this draws tourists to Ontario’s own Niagara-on-the-Lake, enticing an increasing number of visitors each year. The vacation rental market already enjoys a strong summer season and is poised for growth as visitors from near and far move past Niagara Falls and down the road to Niagara-on-the-Lake.
“Niagara is a tourism, cultural, culinary and recreational magnet unique to Ontario,” says Nancy Brazeau, broker with Sotheby’s International Realty Canada. It is also close to international airports and major population centres, both Canadian and American; over 30 million people are within a one day’s drive of the town. “Demand for short– and long-term accommodation is driven by these factors,” says Brazeau.
While visitors traditionally tend to spend one night in the area, Brazeau notes there has been a shift to extended weekend stays as well as increased interest in long-term stays on account of the cultural development that has taken place in the region.
“Our business is seasonal, with high season running parallel to the Shaw Festival season,” she says. This draws about 300,000 visitors a year. The shoulder season is in April and May, October and November, and the high season runs from June to September.
Like many buzzing vacation spots, the town is ramping up events and festivals in a bid to become a ‘four-season destination’, adding the Icewine Festival in January to the roster of events to bolster rental activity in the off season.
Brazeau points to the Niagara-on-the-Lake Old Town, a national heritage district, as a prime submarket to investigate. With architectural influences that reflect 200 years of development, the Old Town continues to draw visitors. Grand homes in the town centre, originally built as cottages by wealthy Americans at the turn of the last century, have been transformed into bed and breakfasts welcoming visitors from around the world.
3) Whistler, B.C.
Peak Season: Year-round
Best buy: Condos, Chalets
Average rent: $1,051 a month
To winter sports enthusiasts, Whistler needs no introduction. But the mountain region is more than just home to some of the finest powder in the world. It’s also home to a bustling year-round tourism industry – and a housing market that has stood the test of time, and hosted an Olympics to boot.
Nestled in the Coast Mountains of British Columbia, between the Pacific Ocean and Vancouver, Whistler continues to attract visitors from all over the world. Already the recipient of international recognition for being a prime, year-round vacation spot, its role as the host of the 2010 Olympic and Paralympic Winter Games catapulted Whistler onto the international stage. As the area continues to remain popular with long– and short-term visitors, the rental market keeps pace. For investors keen to snap up a revenue-generating rental, Whistler certainly has lots to offer.
“Whistler is a year-round full-service tourist resort,” says Pat Kelly of Whistler Real Estate Company Ltd, who has serviced the area for 30 years. “We have everything here; it’s better to ask what we don’t have.” He cites skiing, mountain biking, festivals and events, scenery, hospitality, arts and culture, as well as access to the mountains, as contributors to the high demand for rentals in the area.
Prices may have dropped slightly in recent years, but the market has performed reliably. According to Kelly, this balanced performance is consistent with vacation spots that are always in style. “Like many resort markets, values have consolidated in Whistler over the last three years; current pricing in most areas is good value when compared to historical price points, and we have been enjoying overall improvement in activity and values recently,” he says.
Investors looking for a long-term cash-flowing investment would be wise to consider condos. Like Vancouver, Whistler has experienced a drop in condo sales in recent years, but prices have remained stable at around the $350,000 mark.
Condo-hotel units in particular are good buys, as access provided by the Sea to Sky Highway has also reduced the number of local residents looking to purchase second homes. Driving up for a day or long weekend and renting is now easier. This, coupled with the demand from international travellers and long-term visitors, means the rental market remains buoyant. “Hotels run about 55 per cent–60 per cent year-round,” says Kelly. “As a year-round mountain resort, short-term rental is a big part of what we do.”
Kelly believes that investment strategy, more than factors such as property type and price point, is the key to discerning what the ‘best buy’ in the market would be.