A 2001 HOUSING MARKET ODYSSEY
A CONSUMER VOYAGE

As the New Home Market enters a new millennium, some specific trends are shaping consumer attitude and product definition.

The Consumer as Vigilante
The supply of new home product in the GTA is at an all time high. Over 700 projects provide a selection of over 20,000 different product offerings. The 1990’s created a consumer far more demanding and discerning. A sometimes vicious and angry consumer who knows what he/she wants and expects a very high level of value and service. Anger this consumer at your peril!

The leaders in the housing industry recognize that we are entering the consumer’s process – they are not entering ours.

The most important lesson for the new millennium is that the process has become far more important than the outcome. The buying experience, the level of service have fundamentally replaced price and location as primary motivations to purchase.

The Consumers Wants More For Less
While the consumer is in the “power position” of decision making this is reflected in the demand of more for less. The consumer rejects sameness and seeks individuality. The battle for the consumer’s mind is emotional not always rational.
In this environment the overwhelming success in today’s market goes to the builder/developer who delivers on a community promise. Much more than the simple bricks and sticks driven by price, the “home run” projects in the GTA provide the whole package – a sense of neighbourhood, themed architecture and community amenities. Furthermore the product itself is delivered with customization. The “décor store” is a phenomenon exploding on the housing scene where a consumer can enhance their home with an individuality restricted only by budget.

The wide/shallow lot has secured a 22% market share delivering a product that didn’t exist five years ago. It’s primary reason for success – give the consumer more for less!

The Consumers Suffers Sticker Shock
As increased costs, market demand and this demand for individuality push prices higher there is a sticker shock reaction. The consumer demands more for less but increased costs produce a product that is less for more. The classic “Catch 22”.

The industry’s response has been targeted at differentiation or how to set your product apart from the norm.

Differentiation is the key to satisfying and capturing this demanding and discerning consumer. Examples abound – Mattamy leads the market in “wide lot” design; Tribute in community merchandising; Heathwood and Monarch in customization and consumer service; and Tridel in exceeding customer expectations.

Familiarity is Security.
In a world where constant chaotic change is the norm the consumer seeks refuge from more frequent and faster catastrophic events.

There is a need for shelter from uncertainty. This creates a demand for a broader shared purpose in a sense of community.

The consumer is driven to a nostalgic familiarity. The primary motivation to move is the dissatisfaction with where they live now.

The consumer demands more than just shelter. The demand is for a familiar neighbourhood devoid of the chaos in the outside world. Hence the industry’s embrace of “New Urbanism”. A throw back to the great old neighbourhoods of Toronto. A common architectural theme linked and formed by innovative and special development planning and design. The fundamentals are an attempt to make the automobile secondary in subdivision planning and bring back the verandah!

The Toronto development industry is an agent of change. The consumer is the driving force behind the need for this change. The industry has responded with many exceptional examples of community and product design innovation. Critics will say they are hard to find but for this demanding and discerning consumer they are well worth the search.

Keep Positive!
PMA Brethour Group
Andrew Brethour
Marketing & Sales Consultant to the New Home Industry
andrewb@pmabrethour.com