A gated community is an enclosed residential development with controlled access points for cars, pedestrians and others. The community is typically surrounded by fences or other barricades or barriers. Gated developments have not been widely accepted within the Ontario marketplace. Opponents point out that such large scale developments create elitism. Planners involved with new housing developments, as well as intensification and infill projects, have emphasized the need for community and integration rather than exclusionary developments.
Some condominium developments that might be labelled as gated communities are simply condominium buildings with perimeter fencing and controlled access external to the main entry door into the structure. Gated communities are typically based on the common element condominium and share many similarities. A common element condominium must be freehold, and not vacant land or a phased condominium. Each owner of an interest in the common elements must own a freehold parcel of land to which his or her common interest attaches. Upon registration of the condominium declaration and description, the common interest of an owner attaches to that owner’s parcel of land (e.g., a home located nearby) and remains attached even if that home is subsequently sold. The home is referred to as a POTL or Parcel of Tied Land. A golf course, ski hill, park or road might be a common elements condominium in which owners are required to pay for maintenance, repair and modifications.
Although Ontario has not seen an increase in full fledged gated communities, there has been an increase in POTL type arrangements in recent years. Be aware though that some newer freehold neighbourhoods that look nothing like gated communities may include monthly POTL fees for access roads. These fees may be levied for snow removal, garbage and recycling due to roads not being serviced by the local municipality. This could be because the road allowance does not permit municipal vehicles safe access to the roads in the neighbourhood. It is important to note that these POTL fees are over and above any property taxes or special assessments that may be paid to a municipality for services that are ordinarily delivered to freehold communities.
Whether you are looking for a gated community, condominium or freehold, it is important to ensure your REALTOR® informs you of any POTL type arrangements that may exist for the property you are purchasing. In addition, the services provided for the POTL fees should be assessed from a value for money perspective and taken into consideration in the determination of your offer price. There is a lot of ambiguity regarding POTL properties. They are not synonymous with gated communities. If you are looking for a full fledged gated community, there are a variety of options available in the marketplace depending on your needs that may provide similar benefits. A REALTOR® can help you navigate the market and explain the pros and cons of ownership models and locate gated communities or other viable alternatives.