How a Small Newfoundland Town is Saving Canada’s Urban Middle Class
BY Gary Newhook
April 2017
BUY TAMARACK BAY: Vancouver couple Randy and Diane Sheppard had given up on the dream of owning their own home. Despite years of saving, even the smallest houses were out of reach due to rising prices.
“We had $20,000 in savings,” explains Randy, “With the price of a home in Vancouver, that wasn’t nearly enough. So we had this money just sitting in the bank, and interest rates were so low it was actually losing value to inflation over time.”
The Sheppards needed an investment, but didn’t want to risk losing their money in the volatile stock market.
“We just wanted to own SOMETHING, even if it wasn’t in BC,” says Dianne, “So we found this little salt-box cottage overlooking the ocean in a rural Newfoundland fishing village called Tamarack Bay for less than $50,000.”
Randy and Dianne told their friends about the purchase. Those friends, who were in similar situations, followed the Sheppards’ example, jumping at the opportunity to be property owners. Before long, owning property in Tamarack Bay became a status symbol amongst 30-something urbanites.
“We turned around and sold our little cottage for nearly $175,000. We made enough to put a down payment on a townhouse in Burnaby.”
Their story is becoming a familiar one, with thousands of couples in Vancouver and Toronto buying and selling property in Tamarack Bay to finance home purchases in Canada’s hottest housing markets.
Tamarack Bay, population 154, has not seen this much economic activity in years. Young people left in droves after the closure of the fish plant. There’s no school, the only business is a gas station, and it’s hours away from any significant population centre.
Local man Cyril Squires says some are cashing out, “I know a guy out the road who sold his fishing stage for $250,000. He got it all now, a side-by-side, big F-250, new Ski-doo.” One home on the main road was sold 56 times in 2015 alone, the price jumping by $200,000 by the end of the year.
“We turned around and sold our little cottage for nearly $175,000. We made enough to put a down payment on a townhouse in Burnaby.”
Newfoundland realtors have been posting record profits, and selling homes in Tamarack Bay contributes more to Newfoundland’s GDP than even the fishery. However, some are concerned there may be a bubble. Bill Power of Power’s Realty recently moved his office to Tamarack Bay, “I don’t think there’s a bubble. People throw around that word and don’t understand how the market works.”
What do the residents of Tamarack Bay think of their new neighbours? “B’y, you don’t see any of them around very much truth be told,” says Squires, “Might as well be someone over in China buying everything up so far as I’m concerned.”
