RESOURCE MANAGEMENT
THE RESIDENTIAL COMMUNITY INDUSTRY-
CHALLENGES, OPPORTUNITIES AND THREATS
Through the efforts of The Association of Residential Communities( ARC), members of the industry come
together on a regular basis to explore best practices and share experiences. During these sessions, which were held across the country with over 100 member estates in May 2017, we explored the impact of the different environments on the industry and conducted a PESTEL( Political, Economic, Social, Technological, Environmental, Legislative) and SWOT( Strengths, Weaknesses, Opportunities and Threats) analysis. The following results emerged:
The political environment
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The increase in protest marches and the violence that goes with this is reaching the gates of residential communities, where the blockage of an exit of a residential estate is a soft target for these demonstrators.
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The publicity around the political environment in South Africa is affecting international investment purchases of property in residential estates and the development of new estates, thus impacting on property values and sales. Rentals, however, have increased because of this.
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Poor service delivery by local government, as well as fraud and corruption, leads to increased taxation.
The economic environment
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The domestic economic situation will put strain on the industry’ s ability to conduct meaningful financial planning specifically related to reserves and investments for future repairs and maintenance of assets.
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Junk status ratings will cause concern amongst property investors where rentals will increase but properties could be sold at below market value.
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Inflated costs of security and other services, including water, will impact on future levies on homeowners.
•• The ability of members to pay levies and other costs stipulated by the HOA will be affected by the economic climate.
The social environment
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Trade unions could target residential communities to gain recognition agreements with the HOA.
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The introduction of higher minimum wages may make it more difficult to employ staff.
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Dealing with cultural differences of members and residents is difficult, specifically when it comes to holding cultural events and religious celebrations.
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The increased use of drugs amongst the youth is becoming more prevalent.
The technological environment
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Security technology and the availability of innovative solutions require staying abreast with technology. Choosing the most appropriate technologies to suit the environment and the region is costly and time-consuming.
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Estate management technology solutions are becoming more widely used to ensure sound communications and administration.
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Social media and the ease with which members can cause damage to the reputation of the community are on the increase, especially where social media are used to spread unfounded rumours.
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Ensuring the protection of personal information and confidentiality is a high-risk issue because of the advances in technology and the increase in hacking activities.
The environmental environment
•• Water quality and rights to water.
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Alien species and the legislated requirements for the planned removal of these.
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Energy and the pressures placed on communities to install alternative power solutions.
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Waste management as a potential key imperative for residential communities.
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