Guest Speaker: Patrick Egan
Broker, Royal Lepage Locations North in Collingwood, Ontario.
- Where is Collingwood?
- What is compelling about the area and why Patrick thinks that people should purchase in Collingwood
- Is Collingwood good for real estate?
- Advice for downsizers and people looking for a vacation property
- How is the vacation rental market there? Do people use AirBNB?
- Quarter-share rentals in the village
- The price ranges in Collingwood & Thornbury
- Patrick’s take on the lifestyle in the area
- The general demographic of people in Collingwood
- The upcoming improvements
- The areas for better buys or places where there will be a lot demand
Davelle Morrison: Welcome to The Morrisonn Report. I wanted to create a podcast that would give people insights into the Toronto real estate market. You can follow me on Twitter at Davelle Morrisonn, and on Instagram as Davelle Morrisonn. You can like my business page on Facebook.
Thanks everyone for joining us today. Today we’re gonna do something a little bit different and speak to another real estate agent that works in a completely different market. Welcome today Patrick Egan. He is broker with Royal LePage Locations North in Collingwood, Ontario. Welcome Patrick, thank you so much for joining us.
Patrick Egan: Hi there Davelle. Thank you very, very much for the opportunity. I’m a big fan of your show myself so this is exciting.
Davelle Morrison: Awesome, thanks Patrick. Patrick, can you tell our listeners a little bit about your background and your career in real estate?
Patrick Egan: Davelle, I’ve been in real estate now for about 15 years. I started with Colliers International after being in office interiors and contract interiors sales, and went straight into investment, industrial, office, a little bit of retail and some design build projects working for Colliers International in the north office, primarily Markham [inaudible 00:01:47] area, and that’s where I cut my teeth, did that for ten years, and then decided that I needed a change to slow down the pace a little bit and get a little more balanced lifestyle, and thought I’d move up to the Collingwood area.
Davelle Morrison: Awesome. That sounds great. So, you mentioned you were up in the Collingwood area. Can you explain for our listeners where that is exactly, for those who don’t know?
Patrick Egan: Absolutely. Collingwood is about two hours north of Toronto. The area is comprised of several towns. You’ve got Thornbury, Meaford, Craigsleith, Collingwood, and all the way over to Wasaga. I concentrate more on the west side of Georgian Bay, from Collingwood up to Meaford. These are rapidly growing communities that are servicing a lot of the people that are leaving the city and also searching this kind of four season, active living, more balanced lifestyle area. And I’m really pleased with the move, and since I’ve come up here I’m doing a little bit of commercial, but focusing on residential as well.
Davelle Morrison: Awesome. That sounds great. What do you feel is compelling about your area, and why do you think people should purchase in Collingwood, and why did you move there? You mentioned a better lifestyle.
Patrick Egan: Oh, you know, I kinda went through a little bit of a crucible. Our family had some interesting health issues that caused us to kind of rethink what we’re doing and how we’re doing it. So I would say that it was, we always had a sense that we wanted to get a more active lifestyle and then just talking with my wife and contemplating this, we thought, “You know, why don’t we try this?” So as a result, we discussed about the different opportunities, should we go to [Berry 00:03:28] because it’s an hour north to Muskoka, an hour over to Collingwood, an hour to Toronto, really centrally located. But we thought, we want people to come up and hang out with us and it’d almost be a recreation kind of concept. So she said Collingwood, and I happened to, I was a speed patroller back in the late ’80s, and had rented a small place in Thornbury which is this community that I’m in now, and I suggested Thornbury, and we came up, had a look around, and were just so impressed with it. I’d always thought of it as just a ski area. You know, Collingwood was the ski area, and Muskoka and the Kawarthas were this summer area.
Davelle Morrison: Right.
Patrick Egan: But the fact of the matter is, is this is a four season area that’s got so much to offer. So for me, active living, the property values are good, access to the city. I actually commuted for two years from here, and it was comfortable. I spent a couple of nights in the city, but it was comfortable to balance between the two.
Davelle Morrison: Awesome. That sounds great. So do you feel Collingwood is good for real estate investors? And why?
Patrick Egan: Well yeah, I think Collingwood is in the incipient stages of … We’re well into two years of a pretty rapid price increase, decrease in availability, they really haven’t been able to keep up with demand. So at the moment, prices are still being forced upward. Two years ago there wasn’t really multiple offer situations, and now it’s starting. So you compare that to Toronto, which obviously as we’re hearing from up here, it’s insane down there.
Davelle Morrison: Yes.
Patrick Egan: Up here, our insane is two or three people bidding, and the losers are, and when I say losers, the people who didn’t win the bid, are completely devastated. Whereas I think, down there when you’re getting 20, 22 and 30 offers on a property, it’s a completely different situation. So we’re still at the beginning stages of that demand. But at the same time, you’re seeing an increase in retail up here. You’re seeing an increase in businesses moving up here and operating. There’s lot of growth and demand, and then of course the ancillary things that occur are, there are services that need to fall into place to support this additional building and population growth that’s occurring up here.
Davelle Morrison: Amazing. So then do you think it’s also good for downsizers and those looking for vacation properties too?
Patrick Egan: Oh, 100%. Right now, I think, I’ll just give you the perfect example of the downsizers. I lived at Mt. Pleasant and Eglington, I had a 1,000 foot semi, that at the time was $755,000 is what I sold it for, 1920s, the original windows, [inaudible 00:06:27] roof, it was just a decent little clean unit. Sold that for 755, and then was able to buy probably around a 3,000 foot home on an acre property in this cool little town called Thornbury for about, at the time, it was $408,000. So when you talk about downsizing, ultimately you’re actually kind of upsizing for half the price, right?
Davelle Morrison: Yeah, totally.
Patrick Egan: So you’re getting a lot of value. My house now, four years later, is probably worth $500,000. So there’s certainly that movement. So when you’re talking about, let’s say Collingwood is 100,000 people and the town of Blue Mountains is 7,500 people, kind of year round population, it doesn’t take many people to sell in the city their $800,000 home and then come up here for half the price and start driving our values up.
Davelle Morrison: Right, of course.
Patrick Egan: If that makes sense.
Davelle Morrison: Yeah, no, absolutely, except for now it’s no longer the $800,000 homes, it’s more like the 1.2, 1.4 million dollar homes the way things are going here. But yes, you could clearly get a lot of value if you’re selling your Toronto home and moving up to Collingwood, for sure.
Patrick Egan: Absolutely. So I think you’re seeing kind of two groups of people that I’ve seen repetitively. There’s the kind of empty-nesters, retirements, maybe the tail end of a career where they can kind of work out of their house sort of thing, consultants. You’ve got those kind of 55 plus people coming up. But at the same time, I think there’s a lot of people our age that are sitting there saying, “Okay, I can telecommute, I can work remotely, and be able to live this balanced lifestyle up here, sell my 1.2 in the city, buy a half million dollar place up here, and live quite comfortably with lower commute times.” The property taxes are ironically very similar, given the values, because of the low population density and the large area, the costs of running the townships are higher, but on the whole there’s lower cost.
Davelle Morrison: Interesting. So, Patrick, how would you say the vacation rental market is there? Are people using Airbnb to rent out their chalets?
Patrick Egan: There’s several different types of vacation rental opportunities up here. One would think of the Blue Mountain Village as the first stop in that program. So you’ve got these buildings that are condominium-ized, you’ve got a management group that’s renting this out on your behalf, cleaning, doing the turnover, lots of stipulations as to how you can finish the room, and then all of the income going into kind of a pooled kiddy and then distributed to owners later. And that’s in the pure condo sense. There’s another rental concept related to that, which is more the town homes, where your particular property is the revenue portion for that investment. So that’s kind of one type of, the Blue Mountain Village, that’s what I think people would pop into their head first.
The next type would be sort of condominium with a management firm related to it, where they’re taking, for example, 30% of the revenue that’s generated. So Mount Springs, which is on Gray Road 19, right by the [Charlo 00:10:01] Ski Club at the north share, one and two bedrooms there, would be managed by the group and rented out by that management team on that particular property. Then you’ve got, of course, the Airbnb. So one to two bedrooms, anywhere from $100 a night to probably $200 a night on average. And then Airbnb will also do, for a waterfront property that sleeps eight would probably be about $500 a night.
So those are great opportunities. Now, the problem is that up here, because everybody was doing it, they started to have some legislation and regulations to throw in to what they’re calling short term accommodations program. And so what you have to do now as a renter is go and spend $2,000, get your place certified. You have to meet a bunch of requirements to do that. And then on top of that you’ve got, I think it’s about $750 a year, you have to do to maintain it. They’re getting stricter on where you can do this and with what types of properties you can do this with. If it’s purely residential, you’re not going to be able to just buy a house and do a Airbnb with it. It’d have to fall within some zone.
So before somebody goes ahead, just buys that, you need to check with the town and also potentially apply for the permit and do that. People are making money on it, and then furthermore there are some grandfathered. So if you back, if the place that you’re purchasing or considering purchasing was a short term accommodations place from prior to 2008, they’re honoring those properties still. All you need to do is prove that it’s been done on an ongoing basis, go and pay the licensing fee, but you’re guaranteed to get it. So there’s certain properties that have that stipulation as well.
Davelle Morrison: Wow. Sounds interesting. I’m sure with Airbnb there’s certainly gonna be lots of different towns and cities that are looking for more licensing and standards and things like that. So I feel like it’s only the beginning of what we’re about to see.
Patrick Egan: Well you know what, I’d love to sit there and make a lot of money and sell people these places, but at the end of the day you do want to maintain the sanctity of the community as well. Right? That’s one of the great things about this area, it is a really nice, nice area. And there’s certain developments that can get a little bit rowdy. Generally it’s not a big issue, but there’s always those bad apples, and you wouldn’t want to destroy a really peaceful little community. So I respect the short term accommodations process. It’s necessary.
Davelle Morrison: Yeah. No, that definitely makes sense. There’s certainly been some issues in Toronto. A friend of mine, people were throwing a party at a house on our street, because the house is being rented on Airbnb. So yeah, I think there’s a lot of work to be done in trying to figure that out. One of the rental opportunities that you had mentioned, I wasn’t sure, is that the quarter share? The rentals in the village? Can you tell us a little bit about these?
Patrick Egan: Yes, effectively, the shared rental pool at the village, you’ve got a certain period of time that you can’t exceed, in terms of your own occupancy. So I know people who basically use that as, “Okay, I own this property, it has appreciated in value over time, not incredibly, but on an annual basis the rental income from these properties is paying my overhead costs, it’s effectively paying my property taxes, giving me a decent amount of time up there to enjoy the area, enjoy a bit of the summer, enjoy a bit of the winter, and it’s fairly hassle-free.”
Davelle Morrison: Right.
Patrick Egan: So would I call it a great investment? Probably [inaudible 00:14:06] you could do it for, maybe get a five percent return sort of thing, but at the end of the day the reality is is that there are better investment opportunities probably, to buy a smaller, freestanding, single family home in Meaford, like a two bedroom or three bedroom for $225-250,000, fix that up and get it rented for $1,200 a month for a couple of years and pay the mortgage down that way. Just in terms of a consistent performing investment in a market that I think is, right now, sort of undervalued. Because you’ve got this, like Collingwood, increased population, prices are going up rather rapidly, they can’t keep up with the demand. Thornbury, Craigleith, is already this kind of gentrified, Toronto ex-pats call them, area, and these smaller two bedrooms are starting at $350, people can leapfrog over Thornbury another 15 minutes, maybe 10 minutes further drive, and get a place for one third less, and in an area where there’s not a lot of new development so it’s fairly easy to find renters for that. In fact, the entire zone right now, from a purely rental standpoint, it’s very easy to find renters.
Davelle Morrison: Oh, awesome. That’s very good. That’s amazing. You know, what kind of price ranges would you see for properties in Collingwood, Thornbury area? You had mentioned a couple properties that were $200,000, so what’s sort of the price range people can expect up there?
Patrick Egan: Well, probably for a two bedroom, war-time bungalow in Collingwood, you’d be 300, 330, which is amazing, because I bought my 1,000 footer in Toronto in 2000 for 285. So imagine it moving up here. So you’ve had this sort of stagnation for the last ten years, where starting 15 years ago, and then fast forwarding ten years it was fairly stagnant. The last five years is we’re seeing this increase most recently. Obviously, it’s being driven by this Toronto population coming up here. But to look at that same bungalow three years ago, you probably would have been 225, now worth 300.
So with that in mind, a nicely finished, three bedroom, contemporary design, completely reno or new build, would probably run you 550 to 600 in Collingwood. You get into the condos, these one and two bedroom condos in the village, you’re probably running in the 225 to 325 mark. There’s a fair amount of availability there, but then again the return on it isn’t as great as one would hope. There’s one bedroom dens in Mountain Springs, which is this little development that takes 30% of the rental, one bedrooms probably running about $137,000, to a bedroom and a half or two bedrooms up to about $220,000, that throws you into that kind of rental pool. Moving a little bit west, toward Craigleith, you’re now stepping into larger three bedroom, new builds, you’re running anywhere from 700 to a million two sort of thing. And you step down to the waterfront, 100 foot waterfront, with four bedroom, Dave Harrington construction, running about three million dollars. So you get down into these kind of waterfront, four season, high end properties, literally three million dollars. Moving further west into Thornbury, I’ve got a board and batten, ’98 construction, probably would run you about, on an acre, with walking distance to school, town water, town sewer, probably run you about $500,000. And then getting over to Meaford, a significant price drop over there. Your two to three bedroom starting at about $300,000, would be the number.
So you can kind of see it, Collingwood’s a little bit lower, Blue Mountain and Craigleith gets higher, and then drops down as you move further west.
Davelle Morrison: Wow. That sounds great. What kind of demographic would you say that you would find up in Collingwood?
Patrick Egan: I think there is your kind of senior, aging population that would have been the standard population over the past 15 years sort of thing. But with this gentrification and this exodus of people from Toronto, again, I think you’ve got these two groups: You’ve got the young family looking for a more balanced lifestyle, getting out of their home that has appreciated in value in Toronto, and then you’ve got the empty-nester, baby boom population, that are looking to retire in a more comfortable environment, and be close to a decent hospital. Right now, Collingwood has a good hospital. There’s a bunch of rigamarole going on about, they’re talking about relocating it, and where it’s going to go. So Wasaga and Collingwood are fighting over who’s going to get the hospital.
Davelle Morrison: Oh wow.
Patrick Egan: But there is a lot of support from the community and the government to support the aging population up here. So I think you’ve got a bit of a 50/50 split about the people that are coming up here. There’s the lifestyle-driven younger families, want a slower lifestyle, and then these retirees that are looking for the same thing. [inaudible 00:20:07] for example, came up and gave a talk on the active senior living.
Davelle Morrison: Yeah?
Patrick Egan: And that’s one thing that I think that’s a really important, call it insight, to the populations that are coming up here, is that seniors want to be active. They are still 40 and 50 in their heads, and they want to get out and ski, they want to get out and bike, there’s just so much to do here year round, that you can do it, and live that more balanced lifestyle. And I think that that’s what’s attracting that generation up here as well.
Davelle Morrison: Right. That makes a lot of sense, for sure. What improvements do you see coming down the road there? Are there changes, you mentioned they’re looking at moving the hospital. Are there any other sort of major changes coming down the road there?
Patrick Egan: Well yeah, they’re trying to improve the airport up here. So more access to international businesses. I gotta be honest with you, it’s just standard stuff. Standard growth. There’s nothing bigger than the hospital going on. They’re talking about doing some road widening here and there, et cetera, but they’re just trying to do manageable growth in the area without it getting too insane. So things like development charges for a new parcel is roughly $40,000 in the town of [inaudible 00:21:38] for example. So when you’re coming in to actually get a severance, get a new law, it’s expensive to break ground to do it. So they’re putting a throttle on the development to some degree.
Davelle Morrison: Interesting.
Patrick Egan: Yeah, especially even from an environmental standpoint, there’s areas within Blue Mountains related to conservation areas, [inaudible 00:22:03] conservation, the Bruce Trail, and the escarpment. There’s a lot of areas that they’re restricting the ability to grow for environmental reasons as well.
Davelle Morrison: Got it. That makes sense. Are there any areas that you think are better buys than others? Places you would recommend or not recommend in that area?
Patrick Egan: I’ve got to admit, I’m enjoying Meaford right now. Just from a pure upside standpoint. I think there’s lots of opportunity in there. I think everything else just kinda stabilized and normalized in that regard. But I think also any property that you could, what my understanding is is that it’s fairly easy at this moment in time to get a rental unit put into an existing home in Collingwood. So of course confirm this with the town. I don’t want to misrepresent it, but because of this demand for rental space, I think they are a little more supportive than you’d imagine. I don’t think it’s like Toronto in that regard, where to get that basement flat’s a challenge.
Davelle Morrison: Right.
Patrick Egan: I think even outbuildings are getting approved for secondary residences.
Davelle Morrison: Awesome.
Patrick Egan: But again, you’d need to speak to the town for confirmation on that.
Davelle Morrison: Perfect. That makes sense. Is there anything else you think our listeners should know about Collingwood and the area?
Patrick Egan: You know, I think that I would never have been that person who said, “Oh I don’t want to come … ” A lot of the people from the north said, “big smoke,” or stuff like that. I lived and breathed Toronto for 42 years. I loved the city. I loved the cosmopolitan nature of it, and I raised a young family down there, three children, with the eldest in grade six when we decided to leave. So I’ve experienced that, and it’s fun and it’s cool, and there’s this concept that people are afraid to kind of leave the city and not be able to get back in. And that was our challenge. For five years, we sat there and said, “Should we do this?” After moving here, first of all I’ve done the city thing. I’ve done Queen Street. I’ve done King West Village, and enjoyed that. Up here, it’s just a different thing. It’s a change.
I’ve done the city, now it’s going and hiking up Blue Mountain. There’s dozens and dozens of trails along the mountain that you can go and do an hour and a half loop and literally drop three pounds in a day, get that heart going. I’m a kiteboarder, so going out on Sauble Beach, Fraser Crescent, Wasaga Beach, these are great launch points for kiteboarding. Georgian Trail, 33 kilometers of straight, flat, ex-railway for roadbiking, and it’s the new golf up here. Everybody’s roadbiking. There’s three stages. There’s mountain biking. The activities up here alone, are just endless. And not only that, every six months you find something else. You’re like, “Oh my God, that’s the coolest thing ever! I had no idea!” And you throw on the top of it, you end up with unbelievable restaurants. Locally grown, sustainable farming, that kind of whole local food movement is happening up here. You’ve got breweries, wineries, distilleries. There’s just so much to offer, and so much opportunity, as a broker I’m conflicted because I want to keep it the same. I love it exactly the way it is.
Davelle Morrison: Right.
Patrick Egan: But at the same time, it’s my job to get out there and share that with the world. But I can tell you, I have not looked back. I loved my time in Toronto, but when you figure this place out, you’re like, “There’s nothing better.”
Davelle Morrison: Awesome. That’s great. Patrick, how can our listeners reach out to you in case they’ve got questions about Collingwood and want to move up there? Can you give us your email and your phone number and everything?
Patrick Egan: Absolutely. My email is Patrick@PatrickEgan.com . To make it easy for your Toronto listeners, my cell phone is 416-400-2800, and the way I remember it is 400 times 2 is 800.
Davelle Morrison: Cool.
Patrick Egan: And www.patrickegan.com .
Davelle Morrison: Perfect.
Patrick Egan: And at the bottom of it there’s a keyword search there, so if you want to type in “rental” or “three bedroom” or the town, it’s a fairly wide search criteria. You don’t really have to get into the one bedroom, two bedroom, this size, that size. Just type in some key words and you’ll probably get some results on that. But I’m 24/7, call me any time, and I’d love to help your listeners out when they’re thinking about moving up here or buying something to invest in. And of course, with the ten years in Collier’s, my number crunching abilities are pretty good.
Davelle Morrison: Awesome. That sounds great. Well, this has been awesome. Very enlightening. We’ve learned a lot about Collingwood. Thank you so much for joining us this morning, Patrick. It’s been great.
Patrick Egan: Thank you, Davelle. I appreciate the opportunity.
Davelle Morrison: No problem. Bye.
Patrick Egan: Bye.
Davelle Morrison: Thanks again for joining us for some Toronto real estate market insights. You can visit my website at MorrisonnSellsRealEstate.com or visit MorrisonnTalksRealEstate.com for more episodes of the podcast. Thanks for listening.