About cottage ownership
Now that you are looking at buying a cottage, it’s time to start investigating the process. There are a vast array of options & expenses that you should keep in mind as you work to bring your cottage dream to life. Hopefully my experience & and dedication will prove valuable to you, but until we get a chance to discuss your needs & wants in person here are some things to consider.
Best Time To Buy
When is the best time to buy a cottage? That all depends on your needs & wants. Getting into the cottage prior to the summer season gives you a chance to enjoy the benefits of the cottage. Buying late in the season or in the winter limit your immediate enjoyment of the cottage but allow for renovations before stepping into it.
Spring and Summer are the best time to see new product as comes onto the market. Most cottages that are priced right will sell within the first 60 days on the market.
Fall and Winter have good shopping opportunities as some sellers will “test the market” with their prices in the spring. If the property doesn’t sell during the summer months, the owners become more willing to negotiate in the fall or the winter.
Creating Your Cottage Wish List
Start off with a proposed budget on what you feel you want to spend on your cottage. Have a flexible price range that considers your long range expenses. Once you have a solid financial plan for buying your cottage, it is time to sit down and decide exactly what you want your summer property to be.
Be both specific and realistic. This will help you narrow down your options and allow you to spend your time looking at cottages that come the closest to meeting your expectations. The greater the WANTS, the greater the EXPENSE.
Here are some of the key things to consider when you plan to buy a cottage.
- Distance from home. Are you comfortable with a half-day or full-day commute?
- Waterfront on a big lake, small lake, river, or private lake.
- Shoreline - Deep water, Shallow & Rocky, or Shallow & Sandy.
- Property that is heavily wooded or cleared.
- Lot size is small, medium, or a private estate.
- Road access, water access, and winter access.
- Are Electricity, Phone and Internet important to you.
- Turn-key (furnishings included), buildings only, or land only.
- Bedrooms - How many & All in one cottage, or cottage plus a guest cabin.
- Bathroom Requirements - Bathtub or Shower? Is one bathroom sufficient?
- Full septic system, Holding Tank or Compost toilet
- Water supply - Lake water, Well water, Municipal water.
Some properties are privately owned to the “high water mark” and others have a ‘Shore Road Allowance” that is owned by the local municipality. Shorelines are typically protected and unalterable. Check with the municipality if you plan to modify it.
Level property makes it easy to carry stuff to and from the dock. It has more usable land for recreation or outbuildings, but may have low laying areas and require more upkeep.
Sloping or Steeper properties will allow for better views of the lake, but have less usable land for a yard, and can be more difficult to get stuff to and from the dock. Steps are required and can have an effect on the usability for mom & dad.
Full foundation - look for cracks, signs of water penetration & walls pushing in.
Piers - Check the support posts and cement pads for settling & shifting along with disconnected cross braces under the cabin.
Decks And Docks
Check for rotten boards, raised nails, and overall condition and stability. A new deck or dock is a very expensive project.
Try to determine the age of the shingles & check for shingle damage on the roof. Inside the cottage, do a inspection for evidence of water damage.
Attic & Insulation
Check the attic for level of insulation & rodents. A well insulated place will be more comfortable in Summer as well as Winter and extend the usability of the cottage.
Wood Stove Chimney Stack
Inspect the pipes for rust. If the cottage has been empty for a long time, make sure the chimney stack is not blocked. Your insurance company will require a recent WETT (Wood Energy Transfer Technology) Inspection in order to use it.
Oil Tanks & Furnaces
Oil tanks & oil burning appliances (furnaces) need to be compliant with todays insurance standards. While there other guidelines to consider, essentially an inside oil tank has a 20 year life while an outside tank expires after 13 years. For insurance purposes you will need both tanks & furnaces inspected by a certified TSSA Inspector. A report within about 5 years showing current compliance should do the trick.
Check the age of the septic system and look for wet spots on the property with extra healthy grass around them. Suitable septic systems today are either concrete or plastic, not metal. The local authority should have paperwork from time of installation with all the details.
Request a water test when you purchase your cottage. It may be needed for financing purposes & will assist in your state of mind.
Cottage Finances (Basic Expenses)
Maintenance And Repairs
Unless you are buying a brand new cottage, be prepared for annual outlays. Cottage systems & tools all require periodic maintenance. Additionally, a harsh winter takes its toll on the dock and cottage roof.
Talk to your existing homeowner insurance company to get an estimate for what you will pay to add the cottage to your policy. You may need to find an insurance company that specializes in cottage properties. Ask for recommendations.
Property taxes can be anywhere from $1500 to $4000 and run somewhat in line with the value of the cottage… on most occasions. As a rough guide in our area consider a multiplier of 0.07 (dependant upon the municipality).
Electricity, phone, Internet, generator fuel, and propane costs all need to be considered. Cottages will often have a wood stove to provide heat, but many cottages also have electric baseboard heaters to consider.
Parking And Docking
Water access properties require a place to leave the car while you are at the cottage, and a place to leave the boat when you are in the city. Check with the existing owners to find out how the handle it & what they pay. Don’t forget to factor in your winter storage costs for the boat.
Cottage Finances (Additional Considerations)
Are you planning to rent the cottage to other people for part of the season? If so, be conservative about your net income estimates. The extra costs associated with finding renters and cleaning up after they leave will eat into the additional cash. Be mindful as well of the municipal restrictions that may be in place. Certain municipalities aim to restrict ‘short term rentals’.
Budgeting for fuel costs and extra wear and tear on the family vehicle requires a reasonable guess of both the number of times you will commute to the cottage, and the average price of gas.
Operating a boat can be expensive and the fuel costs for running around the lake all weekend can have an effect on your budget… especially if you plan to do a lot of skiing, wake boarding, or full-day cruises.