Developers step up quirky incentive game to lure new condo buyers
As seen in Vancouver Courier
The trend for quirky new-home buyer incentives is continuing after developer Woodbridge Homes recently offered a year’s worth of avocado toast to buyers of homes at its West Coquitlam development KIRA.
Today, developer Wesgroup is throwing down the gauntlet and telling its competitor, “We’ll see your avocado toast and raise you a glass of wine.”
This new incentive offers buyers a year’s worth of wine if they buy a home at Wesgroup’s MODE development in Vancouver’s River District. The exact offer is a $1,500 gift card for a nearby wine store, equal to roughly one bottle of wine a week for a year, with each purchase of a home in the new riverfront development.
Brad Jones, vice-president of development at Wesgroup, told Glacier Media, “Our offer is kind of cheeky, in response to another developer’s incentive of avocado toast. But we did this in addition to what is already a really strong incentive package for MODE, which is a discount of $10,000 off a one-bedroom home, $15,000 off a two-bed, and $20,000 off a three-bedroom home. And we’re already offering great value for a new home in Vancouver.”
It’s not just condo purchases that are being incentivized. On one of its new rental developments, Wesgroup is offering an incentive of similar value to the wine, this time paying for packing and moving costs. Those who rent a two-bedroom home at The Westminster in New West qualify for its Moving Made Easy incentive, which pays for a full-service move from a reputable local moving company and is valued up to $1,500.
Ryan Thé, vice-president of development for The Westminster, told Glacier Media, “We wanted to offer something that addresses the practical needs of renters. We know it’s hard to find rental homes with our vacancy rates so low. It’s already stressful enough to find a place, so we wanted to make life that bit easier for renters. It’s been going for about a month and we’ve had quite a lot of uptake on that.”
Making a difference
These attractive offers might seem like luxuries a buyer might otherwise have to give up, or ways to make moving less stressful. But one mortgage broker warned buyers not to be too easily swayed by quirky incentives that may not add up to much.
Alisa Aragon of Bridgestone Financing Pros, powered by Dominion Lending Centres, told Glacier Media, “With new home sales slowing, developers are getting creative with their incentives. But what’s ultimately the most important thing is whether this is the right home for you. A gift card worth $1,200 or so is great, but it won’t make much difference to your monthly costs. Make sure you’re taking into account all the costs, including mortgage payments, strata fees and property taxes, and what you’re getting for those costs.”
But as home-buying continues to be out of reach for many and sales continue to slow, developers such as Woodbridge Homes, Wesgroup and Intergulf are also offering more substantial incentives that could make a real difference to a buyer.
In addition to the year of avocado toast, Woodbridge’s KIRA development also gave buyers a limited-time opportunity to put just a 10 per cent deposit down, instead of the usual 20-25 per cent deposit on pre-sale homes.
Wesgroup is offering those stepped discounts from $10,000 to $20,000, depending on the size of unit, at MODE. And in North Vancouver, developer Intergulf is allowing all buyers to put down 15 per cent deposit on a new home at Hunter at Lynn Creek.
More developments offering low-deposit and other incentives include:
Court by Heinrichs Development: 10 per cent deposit and live free for the first six months
Luxia at Yorkson by Isle of Mann: 5-10 per cent deposit and a $5,000 gift card from Urban Barn with a purchase of a home.
27 North by Intragulf and Tatla: 10 per cent deposit plus choice of ski pass and skis for all the family, free golf for a year, free mountain bikes for the family, or the cash equivalent.
And these are just a small snapshot of the value-added incentives being offered around the region’s housing projects, as developers attempt to lure buyers in a challenging market. Many companies won’t advertise it, but would offer a “decoration allowance” that can amount to tens of thousands of dollars returned to the buyer on completion, while still selling the home at full price on paper. Other developers will negotiate other aspects of a pre-sale home, such as throwing in upgrades, or an additional parking stall, or offering a discount to take no parking stall.
An alternative approach
Taking a different approach to getting people into its homes, and as part of its “Locals First” policy, Panatch Group is operating a rent-to-own scheme at its Port Moody development 50 Electronic Avenue. This program allowed 30 eligible households (first-time buyers who live and work in Port Moody), selected by lottery out of hundreds of applicants, to rent a home at less than market value for up to two years. Within this time, the participating households get the option to purchase their unit and will then have their accumulated rent, which has been collated in a trust, paid towards a purchase price that was locked in at the contract date.
Kush Panatch, president of Richmond-based, family-owned Panatch Group, said, “For a lack of a better name, it’s basically taking 30 families or people in Port Moody and providing them with what I call a pathway to home ownership.”
He added, “The housing challenge is very real.”
– Joannah Connolly, Vancouver Courier, May 24, 2019 06:00 AM