NEW CONDO ACT HITS CONSUMER HOT BUTTON

The new condominium act will be proclaimed momentarily but the development industry has been studying its implications for the last two years. My esteemed colleague, Mr. Harry Herskowitz, a partner with the Toronto law firm of Delzotto Zorzi has been outlining in these very pages, and with exceptional skill I might add, the implications of the new act.

From a marketing perspective the new act will create a revolution in development planning, amenities and infrastructure, particularly in the 905 market area.

DIFFERENTIATION KEY TO SUCCESS
Setting yourself apart from the competition is critical in this very competitive new home marketplace. How often has the new home industry been criticized for creating yet another ticky-tacky box like subdivision? Strong economic growth has put enormous pressure on municipality’s ability to deliver and maintain infrastructure from schools to parks. You will be hearing a new phrase creep into the language - “Smart Growth” – a response by both government and the industry to manage the nature and extent of urban sprawl, a subject in itself for another article.

Amidst this furor on growth is a consumer motivated to purchase something new primarily by the dissatisfaction with where they live now. It is changes in neighbourhood composition, family, workplace, affluence or lifestyle that combine to affect this desire to move.

The development industry has responded to this consumer need with differentiation.

The new condominium act will be the catalyst to deliver these differences.

CONSUMER WANTS A SENSE OF COMMUNITY
In a recent study completed for Tribute Communities over 500 previous purchasers were asked what was their primary reason for moving.

Understandably number one was location but surprisingly number two was a sense of community – ahead of price and product!

This need for a common shared purpose, an attachment to neighbourhood is driven by dissatisfaction with their current environment.

Where is the central gathering place in a new community, where is its heart and soul? The new condo act will deliver on what has been up until now only a promise.

ECO-BIO-STEALTH WEALTH - Trends of the Millennium
Three distinct trends will be more dramatically and finally addressed by the new condo act.

The Ecological movement of the 70’s is finally in full bloom in the new millennium. The Eco-Community will demand environmental protection first ahead of traditional planning and development considerations.

The Biotechnology revolution has created the “downaging” miracle – we will be young forever and defy the aging process. It may hurt a little more but I can still do it according to Nike. This young forever craze must be addressed in new subdivision development and the new condo act is just the mechanism to do so.

Finally, Stealth Wealth is a phenomenon of the 90’s - hidden money, mattress money everywhere! The next decade will produce the greatest transfer of wealth from one generation to another ever in our history. The boomers will both give and receive enormous wealth. Generation “X”, the children of the boomers, is making more money through e-commerce that we had ever thought possible.

Stealth wealth will create a demand for consumer services that will be delivered through the new condo act.

COMMON ELEMENT CONDO A REVOLUTION
The consumer’s need for differentiation and sense of community together with the trends of eco-bio-stealth wealth are captured and delivered by the new act.

The essential cornerstone is the new provision of a common element condo – the ability to attach common facilities or infrastructure to a freehold property.

This will mean that the sense of community from entry gates to social/recreational clubhouses, to parks and open space will become common elements owned and managed by the community. A homeowners association will pay a monthly fee to support whatever level of service is demanded by or in fact saleable to the consumer.

This list of common element components is only restricted by the affordability level of the consumer and the creativity of the developer. This might go so far as to include school, churches or other special interest amenities.

The municipality is also a direct beneficiary as the financial burden of both capital investment and maintenance expense is relieved and absorbed by the common elements condo corporation.

The common element condo will cause a revolution in the new home development scene. Watch for many innovative and very consumer friendly projects this fall that will take advantage of a long overdue and very exciting new condo act.

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