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Industry Leaders Speak (page 1 of 4)

Compiled and edited by Judy Penz Sheluk

Trends and projections from A to Generation Z
Putting together editorial content for a bi-monthly, national magazine can present a challenge: how to balance the topical and timely with the interesting and educational. To that end, we’ve developed regular columns written by the foremost experts in their respective fields. But we also know that there are many other leaders in our industry who have something to say. We decided to give them that opportunity.
Our ‘Call to Industry Leaders’ started with a quarter-page notice on page 5 of the September 2010 issue, which we then followed up with targeted e-mail communications.
To recap, the Talking Points were:
•   Projections for new housing starts in 2011
•   Trends to watch for in design, planning, building and renovation
•   Energy efficiency and/or green programs: where do we go from here?
•   Initiatives to encourage Generation Z into the home building industry
Here are the results, in no particular order, of that survey. We hope you enjoy reading these opinions as much as we did. And maybe next November, we’ll hear from you, too.

Green Is Gold
AVID Canada
Paul Cardis, Founder and CEO

For the past four years, the study of home design conducted by AVID Ratings has confirmed that consumers are making the shift towards greener homes. In 2010, the “AVID Home Design Driver Report” was released at the International Builders’ Show in Las Vegas. The study surveyed over 10,000 Canadian homeowners who, in the last nine years, either built a new home or purchased a newly constructed home.
The questions in this research study focused on a number of areas, including both renewable materials and energy-efficient features. Overall, the energy-efficient features were one of the highest-rated home design elements. When compared to renewable materials, it is evident that the renewable aspect of “green” has not yet penetrated consumer demand to the same degree.
Builders today should recognize the advantage of new, energy-efficient homes over the resale market. Houses that help pay for themselves through energy cost savings are a winner in the eyes of the consumer, while offering an unprecedented opportunity for the builder; some builders are outselling their competition now three to one by offering the more efficient home at a lower price. It is clear that a paradigm shift in home building is afoot; I recommend builders think about change or be left behind.

The New Normal: No More Hype-and-Jive
Braun/Allison Inc.
David Allison, President

Five trends that were catalyzed by the recession will continue to crystallize, becoming the new normal throughout all aspects of our industry; from land acquisition through to handing over the keys to a new homeowner. These trends can be summarized as: an insistence on authenticity; a demand for two-way communication; an expectation of immediate responsiveness; wariness towards mainstream advertising; and embracing digital and social media 
It’s time to embrace the shift away from hype-and-jive. Prospects are not looking for Tuscan-style homes, unless they live in Tuscany. This holds true for interior design, architecture, and most of all, in the way we communicate.
People want (and deserve) facts and information before they will commit to buying the most expensive thing they will ever purchase: a new home. Traditional media blended with digital and social media must be used to get the facts out to prospects. The only antidote to fear and uncertainty is truth, and plenty of it.  
If I see one more real estate development advertisement with an elegantly dressed, Photoshopped woman draped over a staircase, and a headline that says something like “Luxury Lives Here,” I’m going to scream. Treat people with some respect. Inform them…tell them what they need to know. At Braun/Allison, we call this Marketing Journalism, but it’s really nothing more than a commitment to sell the truth.

The Top-Down Condo Twist
Building Industry and Land Development Association - BILD
Stephen Dupuis, President, Chief Executive Officer

Top-down planning is having a major impact on development and building trends in the Greater Toronto Area (GTA). The Greater Golden Horseshoe Growth Plan mandates that 40 per cent of new development in any given year must be within the existing built boundary; development beyond the built boundary, but within the approved outer boundary, must be intensified.
Within the last decade, the share of the GTA housing market captured by high-rise condo developers has steadily risen from one quarter, which was considered normal, to a third, which was called the new normal, to more than 40 per cent (we called that The Year of the Condo), to the point today where slightly more than half of all new home sales annually are high-rise condos.
As this market shift has occurred, the City of Toronto has garnered an increasing share of the building activity within the GTA — at the expense of the suburban regions (the 905 area code) surrounding Toronto.
But there’s a twist: the combined impact of the massive legislated Greenbelt, together with the Growth Plan’s strict limits on urban boundary expansions, has severely restricted low-rise land supply in the 905 area. Between affordability constraints and the 40 per cent intensification rule, high-rise development is taking a firm hold in the 905 regions. 

Understanding FlexHousing
Canadian Home Builders’ Association – PEI
Lori Pearce, Chief Administrator

Most homes built in Canada over the past few decades have been designed to meet immediate needs. However, nothing stays the same — lives and circumstances change, people age and families grow and decrease in size. Why not give practical consideration on how to accommodate our changing needs when flexibility can be readily incorporated — at the start of the build.
FlexHousing™ is a concept of designing and building a house that allows the residents to adapt the space to meet their changing needs. Lifestyle changes have prompted Canadians to consider options in the design and use of their living space, such as improved access to entrances, wider hallways and doorways, and self-contained suites.
Examples of just how flexible and multi-functional a self-contained suite can be include: a rental unit (to help with a first time home buyer’s mortgage or, perhaps, to help finance post-secondary education); a home office; a living space for a teenager; a first time home for newly married adult children, saving for their own home; accommodations for aging parents; and a nanny suite.
FlexHousing™ is a viable option that makes it possible for people to remain in their homes while accommodating life changes and personal needs.
Source: Canada Mortgage and Housing Corporation

Housing Market Slowing Down
The Conference Board of Canada
Julie Ades, Economist

The surge in resale market and housing starts activity, bolstered in 2009 by rock-bottom mortgage rates, has now abated. Higher mortgage rates and tax increases are already limiting demand for homes. As the demand for homes in the resale market weakens, pressure on home prices is expected to fall.
As a result, growth in new housing construction is forecast to weaken in the second half of 2010, and continue doing so throughout the first half of next year. After averaging only 149,000 units in 2009, housing starts are expected to reach 191,250 units in 2010 and 175,500 units in 2011.
Notwithstanding high levels of indebtedness and rising mortgage rates, the recovering labour market should help sustain moderate demand for housing over the near term. Housing starts are expected to start recovering in the second half of 2011 and demographic demand should allow residential construction to reach more than 200,000 units in the latter years of the forecast period.
The fall in renovation spending and the decline in new real residential investment should lead to a contraction in total real residential investment in the second half of the year. On an annual basis, the surge in activity over the past six to nine months is forecast to lead to an 11 per cent gain in real residential investment this year. A decline of 2 per cent is forecast for 2011.

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