Muskoka and Parry Sound Dream Home: Should You Buy Land and Build Your Waterfront Cottage?

The soft murmur of the wind weaving through pine trees and the soothing sound of water lapping at the shore create a captivating atmosphere in Muskoka and Parry Sound.  These beautiful spots in Ontario make many people dream about living by the water.  One of the first decisions you’ll need to make is whether to purchase land and build a custom cottage or opt for an existing waterfront property. Both options come with their pros and cons.  Is purchasing land, constructing a custom cottage more economical, or opting for an existing waterfront property?  Let’s explore this question together.


Buying a Resale Cottage


  • Cost-Effectiveness: Buying an existing property is less expensive upfront than building. Resale homes often come with a lower price tag, making them more accessible.

  • Convenience: The process of buying a resale home is typically quicker than building, allowing you to move in sooner.

  • Established Landscaping and Community: Existing properties often come with mature landscaping and are situated in established communities with known amenities and neighbourhood character.


  • Maintenance and Upgrades: Older homes may require more maintenance and updates, which can add to the overall cost over time.

  • Compromises on Design: You may need to compromise on layout, design, and features when buying a resale home, as it was not custom-built to your preferences.

  • Less Energy Efficient: Older homes may not be as energy-efficient as new constructions, potentially leading to higher utility costs.


Land Acquisition

When buying waterfront land in Ontario, Canada, several specific considerations come into play to ensure the property meets your needs and investment goals. Here’s a summary of the crucial factors to take into account:

  1. Water Rights and Access: Understand your rights regarding water access and usage and any restrictions that might apply.

  2. Zoning and Building Regulations: Check local zoning laws for restrictions on development, including building setbacks from the waterline, septic systems, and dock construction.

  3. Environmental Protections: Be aware of any environmental regulations, such as protections for wetlands or endangered species habitats, which could impact your ability to develop or alter the land.

  4. Flood Risk: Assess the risk of flooding and its potential impact on insurance costs and property value. Ontario’s changing climate may increase flood risks in certain areas.

  5. Shoreline Erosion: Investigate the history and potential for shoreline erosion, which could affect land stability and value.

  6. Infrastructure and Utilities: Verify the availability of essential services like electricity, potable water, sewage systems, and internet access. In remote areas, these may be more costly or challenging to install.

  7. Access: Ensure the property has legal access via a public road or right-of-way. Limited access could affect the property’s usability and value.

  8. Local Amenities and Services: Consider the proximity to amenities such as grocery stores, medical facilities, and recreational opportunities, which can impact your lifestyle and property value.

  9. Conservation Authorities: In Ontario, conservation authorities may have jurisdiction over waterfront properties, imposing additional regulations and requiring permits for development.

  10. Property Taxes: Waterfront properties often come with higher tax rates. Understand the tax implications before purchasing.

  11. Market Trends: Research local real estate market trends for waterfront properties to make an informed investment.

  12. Inspection and Surveys: Conduct thorough land and water inspections and surveys to identify potential issues such as soil contamination or boundary disputes.


  1. Customization:  Purchasing land grants the freedom to mould your vision into reality. Imagine a cottage nestled amidst whispering pines or a sunlit deck overlooking the water.

  2. Location Control: You can select your desired setting—a secluded cove, a rocky point, or a sun-drenched beach.

  3. Investment Potential:  Land tends to appreciate over time, offering potential returns for patient investors.


  1. Costs:  Land acquisition isn’t without expense. Prices vary based on factors like location, size, and proximity to amenities.  In Muskoka and Parry Sound, premium rates are typical.

  2. Infrastructure Expenses:  Developing raw land necessitates investments in utilities, road access, and permits, which can significantly add to expenses.


Building Your Waterfront Cottage, Weighing the Options


  1. Tailored Living Space:  Building from scratch allows for the creation of a personalized sanctuary tailored to your desires.

  2. Energy Efficiency Smart Systems:  New constructions integrate modern insulation, HVAC systems, and energy-saving features, enhancing sustainability and comfort.

  3. Warranty:  In Ontario, new construction warranties are covered by the Tarion warranty program. This program is mandated under the Ontario New Home Warranties Plan Act, requiring all new homes built by registered builders in Ontario to be enrolled with Tarion and to have warranty coverage. Tarion aims to protect the rights of new homebuyers and provides coverage for various defects in new construction homes.


  1. Time and Patience:  Construction projects require time and are subject to delays from weather and bureaucratic hurdles.

  2. Budget Overruns:  Unexpected expenses can strain financial plans, emphasizing the need for careful budgeting and contingency measures.


Understanding the Realities of Muskoka and Parry Sound

Price Comparison

When it comes to real estate prices, both Muskoka and Parry Sound command premium rates, reflecting their status as sought-after destinations. Waterfront properties, in particular, are in high demand and often come with a significant price premium due to their scenic locations and recreational value.

In Muskoka, recent vacant waterfront lots have ranged from $230,000 to just shy of $15 million, depending on factors such as location, lot size, amenities, and proximity to amenities. Similarly, Parry Sound offers more budget-friendly options, with parcels available for under $100,000.

Prices in Muskoka tend to be higher than those in Parry Sound, reflecting its reputation as a luxury destination.

Building Costs Comparison

Understanding the associated building costs is essential for those considering building a home in Muskoka or Parry Sound. Building in these regions often comes with unique challenges and considerations, including environmental regulations, accessibility to utilities, and the need for specialized construction techniques to withstand the region’s climate.

Building costs in Muskoka can be notably higher than in other parts of Ontario due to factors such as high land value, infrastructure challenges, remote locations, environmental regulations, demand for skilled labour, and luxury construction materials and delivery. Additionally, building permits and development fees may add to the overall cost of construction.

The average cost to build a custom home in Muskoka, Ontario, Canada, varies significantly based on the type and quality of the construction. For a traditional timber frame cottage, including site preparation and taxes, the average cost per square foot is between $500 and $600. However, the average cost per square foot for modern cottages with high-end finishes can increase to between $700 and $800.

In comparison, building costs in Parry Sound may be slightly lower than in Muskoka, but they can still be significant, especially for waterfront properties or custom-built homes. Factors such as site preparation, foundation type, architectural design, and finishing materials will all influence the final cost of construction.


The decision ultimately comes down to your personal goals, financial ability, and level of commitment. Muskoka offers luxury, while Parry Sound is more about simplicity and straightforward appeal. Whether you’re looking to start from scratch or want to update an existing property, it’s important to understand that these locations offer more than just vacation spots—they are where your future plans can unfold. If you’re interested in exploring your options in these beautiful areas, our Muskoka and Parry Sound real estate team is here to help. Get in touch with us to receive our Building Resource – Waterfront Guide, and start turning your vision into reality.

Are you ready to make your Muskoka or Parry Sound dream a reality? Contact us at 705-774-1144 to explore your options today.

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