One of the interesting parts of the discussion at the SRA last night was the mention of the “inclusionary zoning” used in the DTES. Inclusionary zoning requires that 20% of all new development be set aside for “affordable” housing. I will propose an extension of this policy across the City.
There is, of course, the controversial question of what “affordable” housing means in this case: should it be welfare shelter rate, or Housing Income Limit (HIL) rate, or market rate. Vision has quite deliberately been tried to blur these distinctions, but skewing toward “market” rate (which, in the West End at least, they have determined to be $1,450 a month for a tiny studio apartment!)
There has also been much talk among the chattering classes about whether low income housing should be concentrated in certain areas (definitely the policy for the last few decades) or whether it is better to spread these units around the entire City. Part of what was clear from the discussion last night was the strength of the love for community in DTES, and I certainly am no proponent of moving people around against their will. However, I suspect that past policies have obliged people (perhaps against their will) to move there and I would like to give some the chance of moving elsewhere.
In addition, I am a strong believer that the entire City needs to take responsibility for solving the low income housing crisis. This is not a problem that only certain neighbourhoods need to solve, but one for Vancouver as a whole. Therefore, I would suggest:
- that all new rental developments for 20 units and more anywhere in the City be required to include a minimum of 20% genuinely affordable housing. For this purpose, I would propose that at least 5% be for shelter rate rentals, and the balance for HIL rate rentals.
- that all new non-rental condo developments be charged an additional non-negotiable CAC equivalent to the cost of building low-income rental housing equal to 20% of the number of units being built in the development; and that these funds be used exclusively for the building of low-income housing. Perhaps such developers could be offered the opportunity to designate 20% of their units for shelter rate and/or HIL rentals.
This idea needs more work, of course, but I put this out for debate. It would, I believe, swiftly add to the genuinely affordable housing stock throughout the City and thus alleviate both housing and neighbourhood crises.
Jak, Gord Price in one of today’s Price Tags has published “Fun Facts on the West End, one of which is that ” the average rent for a West End one bedroom apartment is $1,151 (the citywide average is $1,045). The does not in fact match what the City is saying.
Draw your own conclusions.
A statistic from a few years ago is that 90% of millionaires in North America made their money through real estate. This is obviously also the best route to low cost housing – through public ownership of real estate.
I believe the simplest and best way to low cost housing is primarily any kind of scheme that involves public ownership since major initial costs can be amortized over one or two dozen years and then are gone.
After the period when the major cost is eliminated and only maintenance and operating costs need to be met, then all units can be low cost. Before paying off the mortgage some suites would have to be market rentals, the number depending on the initial costs. The number of market rentals should regularly decrease with time.
Total costs can be significantly lowered by having the land donated since government owns lots of land and there are private donation opportunities. Building costs can be lowered through creating small suites and by doing renovations and additions to old buildings. Often old buildings are considered to have very little value when sold – you can pay for the land and almost get the building for free.
Assuming relatively stable interest rates, any inflation will increase wages and therefore income through increasing Housing Income Limit rates.Combined with increasing market rents, the ability to subsidize units would generally trend to increase every year since initial costs are fixed after construction is completed. And they are reduced every month through mortgage payments, and can be reduced even further through additional payments, donations or funding raising.
In Vancouver 25 years ago a house with suites that sold for $100,000, had a $75,000 mortgage at $600 per month and rented for $1500 per month is worth $1 million today, rents for $5000 per month has no mortgage.