Some housing solutions are less perfect than others



Some housing solutions are less perfect than others



Some housing solutions are less perfect than others


When Gord and Kit Coleman moved into a condominium apartment, they thought their troubles were over. They had escaped the gripes of house-owning, with burdensome mortgages, plugged toilets, leaking roofs, piling snow and breaking fences; they had left behind the trap of apartment rent, where, month after month, they kept pouring out money and, month after month, it disappeared, leaving not a trace behind. In a house, you own something, it builds up equity, you are a person of property, even if the mortgage and the taxes and repairs are a constant drain. In an apartment, you own nothing, and you never know when the rent is going to be raised, or by how much, or whether you will be turned out into the cold.

But a condominium is something else. You buy it, just as you would a house, except that the price is lower and the down payment much smaller. You know what you will be paying every month, and that it cannot vary much, even in the teeth of inflation. Your home increases in value as the housing market rises, so you are building up equity all the time. Yet there is no snow for you to shovel, no garbage to tote, no lawns to cut — all that is looked after by the condominium management. Heaven.

Then why are Gord and Kit Coleman sitting in the living room of their Scarborough, Ontario, apartment, complaining about condominiums? Why have they called in their neighbors, friends and fellow agitators in a newly formed condominium homeowners’ association to join the bitching, to organize the complaints, to make sure that nothing is left out?

Because the theory and practice of condominium dwelling in Canada are not always the same. In theory, the condominium is the answer to the housing crisis, the bright pathway to the future. In practice, well, listen to Kit Coleman for a moment: “The bloody place drives me crazy. It was built like a matchbox, and there is no privacy, no privacy at all. If you knock on the wall like this [knocking], they can hear you one floor down and one floor up. When the people upstairs turn the TV on, we get the program. When you flush the john, people all over the building say, ‘Oh, the Colemans just flushed the john.’ And if


you break wind, God help you.”

Kit is slender and vigorous and quick; her indignation flashes around the room, ricochets off the walls; she is a houseperson, she spends most of her time here; her reaction is personal and intense. Gord, who teaches English at a community college, tends more to the abstract. He is a medium-sized man, but his reddish hair, flamboyant moustache and rugged features make him look like a talkative, humorous Viking warrior, who swings phrases in place of an axe. “We have been told that the condominium provides the perfect housing solution,” he says, “but it doesn’t provide any solution except temporarily, and except for a small segment of Canadians. We have been told that it is the dream of the future, but it is not. In most cases, it is simply an air-conditioned nightmare; in the other cases, it isn’t airconditioned.”

The Colemans' Scarborough home is in one of the dozens of condominiums I visited in a six-week, cross-country investigation, and their complaints, better articulated than most, sum up the views of at least half of the condominium dwellers I interviewed.

The message I got — from politicians, planners, condominium owners, indeed from almost everyone except the developers who are anxious to unload new condominiums on us and the apartment owners who are anxious to make a bundle by converting their rental units to condominiums — comes down to this: condominiums make more sense than highrise apartments; they are more economical than single-family dwellings in their use of space and resources; but they are frequently plagued with shortrun problems reflecting the greed, stupidity and callousness of some developers, and with long-run problems common to all forms of high-density living.

At best, they are not a long-term solution to the housing crisis, they are merely a convenient stopping-off place for young (preferably childless) couples who are waiting to accumulate enough capital to buy a house, and for older folk waiting to retire or die — “the newly wed and nearly dead” of real estate jargon. In Canada’s chaotic housing market, the difference between being one of the exploiters and one of the exploited is the price of a down payment; for now, because of its economic advantage, the condominium is a good place to raise that down payment. And that’s all.

The point is worth underlining because so much of recent housing policy, both in the private sector and at the government level, has been aimed at encouraging the growth of condominiums, and particularly highrise condominiums (which are cheaper than town houses). The ceilings on National Housing Act

Walter Stewart is an associate editor of Maclean’s and author of the recently published book, Hard To Swallow.


loans in most areas of Canada are too low to apply to single-family dwellings, but fit condominiums; Ottawa’s Assisted Home Ownership Plan ceilings, in most cities, will assist you into a condominium, but not into a house; even the new $500 homeowner grant for firsttime purchasers of new dwellings seems aimed at condominiums — $500 won’t help much to buy an average Toronto home costing $54,051, when the down payment runs about $13,500, but may help you into the average condominium apartment, selling for $39,086, with a down payment of less than $5,000.

Not surprisingly, real estate agents are purring and singing the praises of condominiums; not surprisingly, although the concept first came to Canada in 1967, Central Mortgage and Housing Corporation has already approved loans for more than 46,000 condominium owners; not surprisingly, condominiums have gobbled up an increasing share of the mortgage money in such housingcrisis centres as Toronto and Vancouver. In Toronto alone 10,000 new condominium units will be built this year and by 1980, according to an official of A. E. LePage Ltd., realtor, two-thirds of all house building in Metro Toronto will be condominium.

What is surprising is that the federal government whose activities have set off all this industry has no particular brief for condominiums.

A senior official of the Department of Urban Affairs in Ottawa told me, “Of course we’re pushing condominiums, but it’s sheer accident. We set the ceilings at a level where they just don’t apply to houses.” (For example, when guidelines were set for federal funding last year, the Assisted Home Ownership base price was set at $32,000 in Toronto and Vancouver, and insured loans at $40,000; at those levels, houses are almost impossible to buy in either city, but highrise condominiums can be easily financed.) I put this to Urban Affairs Minister Barney Danson, and he said, “That sounds like a fair summary.” I put it to David Crenna, coordinator of the policy resource group for CMHC (a brilliant young man who lives in an Ottawa condominium highrise), and he said, “We have no policy preference for what form housing takes; our programs are not specially directed toward condominiums.”

But if they wind up going into condominiums, it doesn’t matter how you intended them, does it? Wintry smile. “That’s very true, but the point I’m making is that this is not a policy decision.”

So there you have it, policy planning in action. We are going to have condominiums, and almost nothing but condominiums, but not on purpose. Indeed, we are going to have them despite a fascinating study I ran across in the CMHC Ottawa library which seems to warn the government specifically against propagating condominiums. That study, Environmental Change, a report to the CMHC on social effects in housing, was prepared by William Michelson of the Centre for Urban and Community Studies at the University of Toronto. Professor Michelson, after 62 pages of argument suggesting that highrise living, under any form of ownership, presents social problems (when you boil away the jargon, Michelson found that people like houses, and they enjoy life more in houses than anywhere else), makes this arresting point:

“Condominium highrise apartments are not substitutes for the spatial components of single-family homes . . . Highrise housing . . . serves a limited purpose for a limited period. Should the government and the housing industry ... continue to be guided by free-market induced land values, toward the unlimited production of highrise apartments in metropolitan areas as the major answer to the need for more dwelling units, then it will be sowing the seeds of its own destruction. Government land banks which allow land to inflate and merely offer different terms for its eventual allocation are a cruel deception.”

Michelson’s syntax is shaky, but his meaning is clear: stop pushing condominiums. That report was submitted in June, 1973, and gained a place of honor on a back shelf in the CMHC. It was followed by the unveiling of the policies that have helped to promote the current condominium boom. I put the Michelson view to Urban Affairs Minister Danson soon after he assumed his portfolio and he said he’d never heard of Michelson or his report, but he sure would look it up. I put it to David Crenna and he said, “We didn’t ask Michelson to come to such sweeping conclusions. We asked him to do a very limited study.” Okay, yeah, but he sure did come to conclusions. “Well, that’s not what we asked for.”

So it seems we are going to have a lot more condominiums, not because we want them, not because they make total good sense, just because.

Condominium ownership is as old as Babylon (namely, 2000 B.C.); all the name implies is that a number of owners each have a piece of common property

— a house, an apartment, a row of town houses — and each owns his share outright, as opposed to owning a share of a company that owns the property, as in a co-op. If you live in a condominium apartment — the most common form — you own everything inside the four walls and, in all probability, the inside of the windows. The outside belongs to what is called “the common element” — the private land around the building, the balconies, hallways, swimming pool, laundry room and so forth —which is owned jointly by the condominium corporation. You own part of that corporation, too, and with it go the rights to use the common elements and the duties, social and financial, of common ownership. You can sell, to anyone you choose, at whatever price you can get. (In a co-op, you normally have to sell back to the co-op at the same price you paid.)

The obvious advantage is economic. The Colemans couldn’t afford to buy a Toronto house, but they could afford one of 235 suites in a 19-story apartment building. Their two-bedroom unit cost $19,200 when they bought it in 1971; they put down $3,500, and began making payments of $159 a month, including a fee of $28 for their share of maintaining the common element when they took ownership in March, 1972. In an apartment, they had been paying $190 monthly, and that would certainly have jumped considerably by now. What’s more, the apartment rent was simply poured down a bottomless hole; the Colemans’ place is worth about $36,000 today, and rising.

“I thought I was buying a hotel suite in a hotel,” says Coleman, “a place where I could simply tum a key in the lock and walk away when I wanted to. I would have absolute freedom, and no physical responsibility for the upkeep.”

It doesn’t quite work out that way, as anyone who is contemplating condominium living should know. When the driveway caves in, or the roof leaks, or the elevator quits, or the garage doors won’t close, you have to help pay for it. When the snow has to be cleared away, or the garbage collected, you help pay for that, too, because most municipalities, while they collect full taxes for condominiums, do not provide full services. The roads and sidewalks inside a condominium are private property, and no affair of the government’s. They won’t even send cops in to ticket cars parked on the common element roads.

The condominium corporation has a management function that is handled, in


most cases, by an outside company. When the developer finishes the building, he hires a management company — often his own creation, or a partner — who normally signs a lucrative five-year contract to look after it. Then he sells off the units. As soon as the building is registered — usually when a majority of the units are sold and other legal requirements are met — the condominium becomes the charge of the owners of the apartments, in their guise as collective majority shareholders in the condominium corporation. It is then that they discover that the developer has tied them to an expensive, long-term contract and that, in many cases, the management company is working for the developer, not for them.

The Colemans had barely settled into their new home when they received a notice informing them that the condominium corporation, of which they were now proud joint owners, was in debt for $26,437, a matter the management had been too delicate to bring to their attention before. The monthly assessment for looking after the building had been set too low (indeed, this low figure was one of the attractions of the place). Now it was necessary for everyone to pay, at once, a special assessment of approximately $70. Oh, yes and, by the way, the maintenance dues were now hiked by $14 a month.

One of the factors helping to elevate the monthly assessment is a $28,500 annual charge for management of the building. It covers the expertise and endeavors of a man who also looks after at least two other buildings. “I don’t know what the hell he does,” says Jim Briand, chairman of the homeowners’ association Coleman and his neighbors formed when they grew restive last fall. “Every time you want something done, you have to call in somebody else.” But the condominium can’t fire the management firm, nor cut back on the payments or emoluments (these include a free apartment and telephone and 23 parking spaces, which somehow got attached to the free apartment and have been sold to owners with need for an extra space at $300 to $400 each).

The president of the management company is M. Kirsch, who was the sales manager for the condominium. You might think that would make it easy to get things fixed when they go wrong, but it doesn’t. The guarantees on most of the building ran out a year after the condominium passed into the control of its tenants. Then the boiler went, and that cost $1,500; then the roof leaked, not




$280 monthly $60.000 $37,000

Down payment Down payment

$15,000 $5,000

Mortgages Mortgages

$234.31 $138.65

$230.27 $189.97

Maintenance Maintenance

$30.00 $54.40

Taxes Taxes

$54.16 $37.00

Monthly total Monthly total


Pets & kids

Usually restricted

Up to you

Often restricted


Minimal Maximal Depends on your

building and


Maintenance Up to landlord

Up to you

Up to management,

paid by you

Energy, land use


Wasteful Excellent

Investment return None

Best buy Good return



Highest Medium


Often good

Up to you

Often good

Social aspects Can snub neighbors

or love `em

Up to you Neighborliness is


Biggest advantage Lowest monthly cost

Best equity return

Good return for

medium cost

Biggest drawback

No security: rents

may be raised, lease


High initial cost

Your investment and

home are largely at

the mercy of


*Average costs for comparable two-bed

room dwellings in the same area of To

ronto. 1 have given the house an advan

tage; a purchaser today might have

difficulty getting this amount of mortgage

money at the same rate as a condominium

buyer. This condominium had a 25-year.

$16 500 first mortgage at lQ5~ a I" vc~ar

$16,500 second mortgage at 1l.5~: the

house a 25-year. $25,000first mortgage at

10.5%. a IS-year. $20000 second mort

gage at 11.5%.


once, but often, and the builder helped defray part of one of many repair bills. One owner, up on the 19th floor, had $1,500 worth of broadloom wrecked, and that had to be replaced. The garage doors didn’t work, and they still don’t part of the time. “Every time it rains,” according to Jim Briand, “you can row in the basement.” And it costs about $1,000 a year to maintain an inadequately designed cable TV system.

Complaining to the condominium’s board of directors (like any corporation, each condominium has such a board) didn’t help. At first, they were the developer’s nominees, and when the developer moved out and went on to work his wonders elsewhere, the new directors elected from the owners’ ranks simply didn’t know enough to run the place efficiently. It took three years, from late 1971 to late 1974, for simmering unrest to come to a boil. Then a homeowners’ association was formed, a new board of directors elected and the condominium dwellers took over their own destiny. They can’t, of course, do anything about built-in deficiencies, such as the noise problem Kit Coleman complains about, but they can act quickly on complaints and they can, in the fullness of time, get rid of the old management contract.

In return, of course, they have had to give up the elegant notion that they were living in a hotel, with no home-owning chores, and they have had to sacrifice time and privacy. Gord Coleman, who asks nothing more of an evening than to be allowed to bury his nose alternately in a glass of wine and a volume of Proust, instead finds himself hip-deep in politics and business. It wasn’t what he had in mind.

Of course, for some people, the necessity of community involvement, the thrill of the chase after a plumber, the high drama of a stalled elevator or flooded basement, are part of the zest of condominium life. Jean-Pierre Daem, president of the BC Association of Strata Corporations (same animal: in BC condominiums are called “strata dwellings”) told me, “The best reason for moving into a condominium development is the interest and desire to belong to a community. If you want to bring up your children in an atmosphere of cooperation, the condominium is as close to the medieval village as we’re going to get... If you accept your neighbors, and they accept you, this is a pretty good place to live.” Even if you want to be a little standoffish, there are advantages in having others around. One Vancouver woman told me, “There are a lot of people in this building I wouldn’t want to make friends with, and they probably return the compliment, but it’s nice to know they’re there.”

If that is an advantage in condominium dwelling, then here is another: the condominium provides all the facilities of apartment living — if that’s your bag — with the opportunity to own


your own place, a pleasure so deep it can almost be called instinctual. Consider these two quotes from condominium owners in Ottawa: “It is an uncomfortable feeling to be getting a little older and to think, ‘Someday I’m going to retire and the rent may be doubled,’ ” and “While you are waiting for the elevator, if you see a little bit of dirt, you rub it off. In a rented place, you would kick the thing.”

So there is a place for the condominium, but it is a limited one, and the drawback to the current emphasis on this form of dwelling is that it directs too much energy and too many resources to a solution that applies to only a fraction of the people. Most Canadians, as Michelson noted, still want to own their own houses; most believe that it is possible to bring home ownership within reach — for example, by undercutting speculation and profiteering in land.

The condominium was supposed to bring down housing prices; instead, condominium prices have joined the upward spiral, and soon they too will be out of the reach of most Canadians. When Gord Coleman bought his place in 1971, anyone with an annual income of $8,900 could qualify for the mortgage; at today’s market value of $40,000, you would need an income of about $18,000 to obtain financing.

There are other problems, too, problems common to every form of highdensity dwelling. Vancouver lawyer and economist Peter Hyndman told the Vancouver Sun, “Canada has yet to see what the social costs will be in a generation of children raised in concrete cages or postage-stamp sized yards.”

The short-term problems raised by this new housing fad can be met. It is possible to design laws to protect buyers from the sharp knives of developers, and several provinces are now in the process of revamping their legislation to close obvious loopholes. It is even possible to block developers who take over existing apartment buildings and throw the tenants out. In Montreal, the classic Royal View apartments were recently purchased by a group that wants to tear the place down and put up a highrise. Luana Parker of the Montreal Gazette wondered about the sense of tearing down one set of dwelling units to put up another, and developer Tim Lake told her, “The economics of a property is not what’s there now but what’s going up.” Montreal’s lacklustre municipal administration doesn’t seem to care about such problems; other cities do. In Vancouver, municipal council prohibited apartment conversion without the consent of tenants; the developers are busy working around the law by selling, not the apartment but a 99-year lease on it, and advising tenants to buy or get out. The lawmakers are still working on that one. (Tenants had better luck in Winnipeg; there the only major conversion attempt to date was stopped dead by a provision of the provincial Landlord and Tenant Act that gives tenants a right to renew their leases. A number of them did, and the developer couldn’t sell enough units to make the project worthwhile.)

Leaky roofs can be fixed; leaky laws can be mended. What is more disturbing is the way the condominium concept seems to have taxed the energies and sapped the imagination of our policy makers. In the past 12 months, beyond a few peripheral budgetary gadgets (a cut in the tax on building materials, a tax shelter for an annual $1,000 savings toward the down payment for first-time home buyers, improved funding to help lower income families with their mortgages), there has been no attempt to come to grips with Canada’s housing crisis. There has been, instead, the flourishing condominium, and even that is soaring out of reach with inflation. The underlying cost inflators, including land speculation and high and rising charges for services, labor and mortgage loans, are not touched by the proliferation of condominiums.

I heard the same terrible joke in Vancouver, Calgary and Winnipeg. Guy comes home, throws his hat on the table, tells his wife, “Good news, dear, I bought us a condominium today.” She smiles, “That’s nice dear, but I think I’ll stay on the pill.” Which is to say that the condominium is an item often misunderstood, and fearfully misapplied.^