Thursday, July 8, 2010

Townhomes evolve to offer bang for buck

From boring entry-level boxes to swanky, open-concept homes with luxe finishes, townhomes have evolved, offering buyers a big bang for their buck


By Patrick Langston, The Ottawa Citizen
 
 
 
Three decades ago, most townhouses in Ottawa got little attention. They were, after all, considered mere entry-level homes.


Optional features were virtually non-existent, charm often at a premium.

Their side-by-side sameness was the price you paid when you were only paying about $80,000.

By comparison, today's towns, with price tags that can soar into the high six figures, positively swagger. Ensuite bathrooms, razzle-dazzle kitchens, double-wide garages to store your boat: when it comes to features, ask and they shall be yours.

Heck, these showboats don't even like being called "townhouses" anymore. Now it's townhomes or, in the case of those one-storey glamour pusses aimed at the greying market, "adult-lifestyle bungalows."

And whether they're freehold -- you own the unit and its bit of surrounding land -- or condominium -- you own the interior but co-own the rest with other members of the condo corporation -- townhomes are getting snapped up faster than a free weekend in Vegas.

As to buyers, they're all over the map, from young singles to empty-nesters.

So what's with Ottawa's love affair with townhomes?

To a large extent, their proliferation comes from the maturing of Ottawa as an urban centre and the municipality's professed commitment to housing intensification to combat urban sprawl.

"There's no new single-family homes inside the Greenbelt," explains Brian Card, president of the Ottawa real estate consulting firm Corporate Research Group. And because there's no land for new singles, builders turn to townhomes.

In fact, he says, there's not much room for even townhome development, which means they appear as mostly infill projects.

Meanwhile, the City of Ottawa is trying to put the brakes on the development of land outside the urban core while also upping the requirement for new, intensive housing, like multi-unit buildings from the 2006 level of 34 per cent of new starts to 40 per cent in 2021 and 44 per cent 10 years later.

To this, add escalating land prices. Since developers can fit a lot more townhomes on a given chunk of land than they can singles and offer some pretty nice features with the money saved, the 'burbs have also become townhome hot spots.

And let's not forget our remarkably low interest rates, which have suddenly put affordable townhomes within reach of a whole new group of first-time buyers.

"Townhomes are priced to the point where instead of renting your first house, you can afford to buy it," says Nisha Wellstein, marketing manager for Mattamy Homes (mattamyhomes.com). Mattamy offers a number of townhomes, including the popular Spirit model, in Kanata's Fairwinds North development and Half Moon Bay in Barrhaven.

Referring to Mattamy's tiny, 1,100-square-foot Appleby village home series, she says, "It's $199,990, so you can potentially purchase your first home for less than renting a two-bedroom apartment. The mortgage is about $800 a month."

Tack on the sheer attractiveness of the new generation of townhomes, as well as their convenience (as in, minimal to zero grass cutting and snow clearing), and Card's conclusion about Ottawans' housing choices seems irrefutable: "Townhomes used to be an alternative to single homes because of their affordability. Now, they're a preference."

Ottawa has seen steady growth in townhome construction over the past decade, according to Canada Mortgage and Housing Corp. In the early 2000s, it accounted for about 25 per cent of new starts; that was followed by a mid-decade dip, but over the past three years, it's been clocking in at 30 per cent or better.

CMHC doesn't list townhomes in Calgary or Edmonton as a separate entry in its general housing reports. However, in Toronto and Vancouver, townhomes account for only about 15 per cent of new construction. In Montreal, towns made up only about five per cent of new starts in 2008, the last year statistics are available.

This year, CMHC predicts a leap of 11.3 per cent in townhome construction in Ottawa. That compares to 4.4 per cent for new singles. Cumberland and Nepean will capture 50 per cent of all townhome construction in 2010.

No wonder Ottawa's often called "the townhome capital of Canada."

John Herbert isn't convinced that's what we really want. The executive director of the Greater Ottawa Home Builders' Association says that anyone who can afford it still wants the classic suburban single with its own lot. Problem is, he says, the city has stymied that desire with its land use policies.

Herbert also questions how many boomers will really want to swap the Ponderosa for cheek-and-jowl closer quarters. Empty-nesters will prefer to stay in their singles so there's room for the grandkids to visit, he says.

And if they get fed up with maintenance, they have the money to simply hire someone to do it, he says.

Even so, Herbert agrees that townhomes have "developed respect" over the past decade or so. "They've become a legitimate housing form," he says, as the housing acquisition chain has grown longer and more varied: a young family can now move up from a basic townhome to a fancier one before jumping to a single and, at the end of it all, maybe downsize back to a town. In the old days, people moved out of -- not up to -- townhomes.

They also appeal to Ottawa newcomers in need of space at an affordable price.

"About 20 per cent of Ottawa's population is immigrants," says

Sandra Perez Torres, a senior market analyst with CMHC. "They need bigger homes because generally they have bigger families or bring their extended families from other countries. They can't live in an apartment. They need a single, but maybe a single is a little more expensive, so the option that gives them space but is affordable is a town."

Thanks to a combination of buyers' rising expectations and builders' competitiveness, townhomes are ever-more luxurious. In many cases, they're competing with and sometimes outflanking singles in all features but lot size.

In Kanata's Brookside development, Holitzner Homes (http://www.holitzner.com/) has sold out its five townhouse models, ranging from $281,159 to $363,494. Marc Lalonde, a designer with the company, says the homes were designed four to a block instead of six. That allowed for widths of up to 24 feet for end units and a greater sense of spaciousness in all the homes. It also let Holitzner meet buyer demands for main-floor powder rooms and gracious ensuites in the master bedroom.

Holitzner's temporarily delayed Mosaic project in Kanata will feature three-storey towns in the mid-$200s.

Other Ottawa developers are going to town, so to speak, on their towns.

Talos Homes (http://www.taloshomes.com/) is building an enclave of 20 executive townhomes in Brookside, scheduled to open in June. Its 1,855-square-foot, three-bedroom Meadowbrook model ($289,900) includes crown moulding and a walk-in closet in the master bedroom, ceramic tile in the kitchen and foyer, and a gas fireplace to cosy up to in the living room.

At $294,900, Talos's Westbrook model adds a breakfast nook, another popular must-have on townhome buyers' shopping lists.

Over at Urbandale Construction (urbandale.com), the Horizon townhome series has just been released in Kanata Lakes and will open in Bridlewood and Riverside South in the spring.

In Kanata, square footage ranges from 1,604 to 2,420 with prices starting at $272,900. The Horizon series includes an open-concept floor plan, nine-foot ceilings and an Energy-Star rating. "Buyers are looking for as close to singles as they can get," says Urbandale's marketing and communications manager Gillian Goddard.

A singles look is very much what features like the elegant, curved staircase in Minto's Manhattan series achieves. One of Minto's most popular townhome models, the Manhattan in east-end Avalon (from $272,400) includes a finished basement with a fireplace.

Buyers of such homes can, in part, thank developers' inherent one-upmanship for those flourishes, says Minto (www.minto.com) executive vice-president Robert Greenberg. "Competition among builders is very sharp. There's better design here than I've seen across the country in townhomes."

Asked by e-mail what features townhomes offered in the 1980s, when Minto was a leading builder of the units, Greenberg replied, "Big spaces!"

Builders also try to offer the design flexibility more often associated with a higher-end single.

When Matthew Moran and Nathalie St. Louis bought their end-unit Royalton town in Barrhaven's Chapman Mills development, they asked Minto about some major ensuite upgrades that included moving a wall to add a bathtub. No problem, said the developer.

The young couple laid out $29,000 in extras, bringing their total price to $301,000 for the three-bedroom home.

Moran admits a single-family home is "always the dream," especially since they have a young daughter, Madison, but the couple got a bigger and brighter home than a more expensive single.

Light is a crucial issue when he's designing townhomes, says Ottawa architect Barry Hobin. He's designed high-end infill projects around Ottawa, including Charlesfort Developments' Arts-and-Crafts condominium townhouses in Old Ottawa South (finished in 2006, the units sold for up to $873,500).

Wider middle units help solve the light problem, Hobin says, while attention to the existing neighbourhood house will ensure the new kid on the block fits in more easily.

"The biggest constraint is the garage. Most townhomes are just a garage and a door. The narrower you make it, the tougher it is (to design)."

Hobin says there were some "intelligent" townhomes built before 2000, but they tended to be infills built by the likes of Bill Teron, a man usually referred to as the "father of Kanata" for his central role in developing the west-end community.

One of Teron's projects, Canal One Eleven built in 1983 on the Rideau Canal near the Pretoria Bridge, illustrates another reason for townhomes' popularity: they tend to be solid resale investments. As an example, one of Teron's two-bedroom canal towns, purchased in December 1983 for $162,500 sold eight months later for $235,000.

Not all townhomes surge in value like that, but the resale price has increased in tandem with single homes, according to Ottawa Real Estate Board president Pierre de Varennes. Just as importantly, "the resale of townhomes has been an increasing part of the (Ottawa) marketplace."

Townhomes have been credited with helping revitalize areas of Ottawa East by bringing in new residents, they are part of the proposed redevelopment plan for Lansdowne Park, and they are becoming a standard feature of the 'burbs.

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