Many issues are creating a buzz in the Georgian Triangle real estate market. The Georgian Bay Club, which has received the highest rating for a new golf course in Ontario, has opened to rave reviews. Of course Intrawest Village at Blue Mountain continues to thrive. The Westin Trillium Hotel is under construction, more new retail/restaurants are under construction with openings projected over the next few months. The long awaited grand opening of the sales office on June 25, for the Collingwood Shipyards, which is the transformation of the former Collingwood shipyards to residential and commercial properties, has created tremendous interest. Apparently, over 50% of those registered for the first release are existing Collingwood residents. It will be an exciting new community to live in and will also add a brand new dimension to the town. Collingwood is experiencing an unprecedented growth phase in retail expansion on the west end of town at the Blue Mountain Mall. This expansion is being anchored by a brand new Canadian Tire, with Mark's Work Wearhouse, Casey's, Montana's, Quizno's, and Topper's Pizza. For those of us who have tried to get into a restaurant on Friday nights during the winter or a busy holiday weekend during the summer, the new restaurants will be welcome and we wish them all the very best. Streets and highways in and around Collingwood are under construction, another sure sign of growth and expansion. Admiral's Gate, a 42 unit luxury waterfront condominium development, is under way on the Georgian Bay shore-line, between Cranberry Village and Rupert's Landing. We are marketing and selling the remaining eight condominium units in Riverwalk, situated on Georgian Bay at the mouth of the Beaver River in Thornbury. This luxury condominium community is 75% sold out and occupied and it is a popular residential building for permanent and weekend use. Stop by Saturday or Sunday afternoon for a tour during our Open House hours.

The current real estate market remains vibrant in most market categories. Prices continue to rise at or near the national average. Again, so far this year, due to the increased number of higher end sales year over year, we are seeing the level of investment that people are making in the immediate area continue to increase per transaction for quality recreational and permanent homes. We are experiencing some market segments, particularly condominiums at or near Blue Mountain, which have many units for sale, with very sluggish sales. Reasons for the slow-down in condo sales are varied, however, it is very apparent that considerable comparison shopping is taking place in attempts to get the best possible deal. There is a general belief that prices are peaking or have already peaked, particularly in condominiums, and as interest rates begin to move up, there will be downward pressure on prices. A lot of time has been spent in the media discussing a housing bubble over the past few months. Whether you subscribe to the theory that prices will correct or that we are experiencing a controlled steady appreciation of real estate, our local market is developing in so many sectors, that we feel a correction will take place, but will be less severe because of the strong base that has been established by permanent residents. Since 1998 house prices in Toronto have appreciated 35%, compared to house prices in Manhattan and Boston which have seen a 70% increase over the same time. Economists have gone on record as indicating that Canada, while experiencing a very active market in terms of price appreciation, has 3 to 5 years before interest rates must rise substantially to slow down price appreciation. Home ownership, due to low interest rates are more affordable now than in the late 1980's when house prices had increased to extremely high numbers. Economists also predict that home prices in Toronto, after being adjusted for inflation can increase another 20% before reaching the price levels of the late 1980's. The average price of a home in Toronto increased from $307,155 on March 30 to $321,131 on April 30. Residential housing starts have strengthened this year over 2003, bolstered by incredibly low mortgage rates and solid job gains. Anticipating increased interest rates, the housing market will in all likelihood moderate as the year progresses.

Home sales in the Town of Collingwood have been very brisk so far this year. If a brick home in town is listed for sale, it will in all likelihood be sold within 30 days. A two story brick home that is situated in an established family neighborhood, will very likely sell with competitive offers existing or contemplated. The current situation whereby so many families are re-locating to Collingwood with very few families leaving Collingwood is creating family home inventory shortage. Communities such as Georgian Meadows located at the intersection of Sixth Street and the 10th Concession is servicing the next phase and is selling very briskly on the market

The current supply of re-sale condominiums in Collingwood and at Blue Mountain (see table below) has created a market whereby many potential buyers are sitting on the sidelines and taking a wait and see approach before making a buying decision. In general, condominiums that are older, more than 10 years, and require up-grading or renovation, are usually the last to sell if in competition with newer or up-dated units. Condominiums at Cranberry Resort, Lighthouse Point and Rupert's Landing have recently experienced a significant increase in sales and inventory is decreasing. Condominium sales at Blue Mountain in Mountain Walk, Wintergreen, Chateau Ridge and Cachet Crossing are selling but are price sensitive. These developments have seen significant value increases in the past 24 months. Resort condo re-sales in the Village at Blue Mountain are non-existent so far this year with a large inventory of re-sales available. We feel this situation is a result of property tax increases and reduced rental program occupancy. Mountain Springs Lodge (MSL) has enjoyed a large amount of sales activity year to date with an inventory of listings available. Mountain Springs Lodge is under-going a renovation to one of the condominium blocks and sales should begin again here in early summer as buyers recognize MSL as a reasonably priced hill-side resort with up-side investment potential. Heritage Corners and Summit Green both have reduced inventory and have enjoyed reasonable sales activity so far this year. The table below compares the number of condominiums for sale one year ago, compared to June 15, 2004 as well as a comparison of units sold year to date compared to units sold for calendar year 2003. The substantial increase in inventory units listed for sale in the Village at Blue Mountain and the lack of any re-sales so far this year has created an over supply of product.

As of June 15, 2004, there are 33 Intrawest Village Condominiums available for re-sale. The average list price per square foot is $495.00. So far in 2004, there have not been any Village Condominiums re-sell and of the seven sales that have taken place in the Grand Georgian and Weider Lodge, the average sale price is $452.00 per square foot. In Mountain Walk, Chateau Ridge, Cachet Crossing and Wintergreen, there are 7 condominiums currently for sale with 6 units sold in these developments since January 1, 2004. These latter developments have experienced substantial price appreciation in the past 12 months. The reasons are varied, however, there still continues to be high demand for these older and larger units. The challenges of the cost of repairs, maintenance and special assessments for older condominiums for owners and new buyers, appear to hold value dollar for dollar. The occupancies and rental revenues are also holding their own over the newer Village Condominiums. Historic Snowbridge and Rivergrass both offer newer and larger condominiums a short distance from the Village and are very appealing both from an owners and a guest's perspective. So far this year, there have not been any sales in Historic Snowbridge. In Rivergrass while some units are occupied, the project is still under construction.

In late 2003,as most condominium owners know, the Province of Ontario enacted a policy to change the realty tax classification from residential to commercial for any condominium in the province that participates in a commercially managed rental program. This will result in an increase in realty taxes for most condominiums at or near Blue Mountain Rsorts. Lobbying efforts by the Blue Mountain Village Association with the Ministry of Finance are on-going with the hope of having the policy over-turned. Recent updates we have received from MPAC have indicated that there is very little support at the ministerial level to change the policy. While we have not been able to get a clear understanding of what the realty taxes will be for 2004, the financial models that are being used by the Ministry of Finance and MPAC in calculating realty taxes for ministry purposes, utilize the current market value, issued in late 2003 and by using the current mill rate of 3.102%.

Our business practices continue to require change in order to satisfy legislation created to protect the interests of consumers in real estate matters. The changes to the processes in which we collect and deal with personal information requires adherence to a privacy code that is becoming a world wide matter. The under-lying purposes for defining roles require a continued awareness of our fiduciary duty to clients regardless of the representations, roles and responsibilities that we are involved in. Disclosure of all information and facts that we are aware of regarding a particular situation may not be popular in all situations. It is however the way we practice real estate and is an extension of the Code of Ethics by which we are bound.