ASK PAT: Housing idea

Terran asks—

What do you think about the recent Vancouver idea to buy homes and undervalue them? Do you think this could work in new west?

I can’t quite get my head around the City of Vancouver plan. They appear to wan to buy 20% of the housing value, and hold that portion while the market still influences the pricing of the units. If I understand it right, a middle-income-family would by 80% of a home, live in it, sell it off and receive 80% of the sale price. If the value goes up (as is likely today) when they choose to upgrade or move to Temiskaming, do they get 80% of the capital gain and the City the 20%? There are devils in details here.

My first question when putting this in the New West context would be –is it legal? Vancouver seems to be floating the idea of making changes to the Vancouver Charter to make it work, and I’m not sure how this model would fit into the Community Charter that governs New West.

There is another simple resource problem: New Westminster does not have a lot of money. We don’t really have a longer-term land acquisition strategy to speak of (we are working on developing one now), nor do we hold a lot of property relative to many of our surrounding communities. Investments that could have (should have?) been made decades ago when land values were low were not done for what I’m sure were very practical reasons at the time. Our finances are pretty good, but the few capital projects we have coming along in the next few years (Massey Theatre, Q2Q, Canada Games Pool, etc.) are going to tighten things up quite a bit.

This raises the question if this is the most effective way to leverage the money we do have. The City holds about $1Million in our Affordable Housing Reserve, and we have a task force working on a couple of strategies to leverage partnerships to assure those funds go to where they can make the best impact.

Finally, I wonder if the Vancouver solution (making apartments 20% more affordable for essentially middle-income workers) is really the affordability problem we need to solve in New West. I get the sense that New West is affordable for middle-income earners, especially if they are happy to live in an apartment setting. Single Family homes are getting out of reach, but building more “missing middle” housing types like townhouses, laneway houses and cluster homes might help provide better options to those earning family incomes in the $70-90,000/yr range (the target of Vancouver’s plan).

In New West, we are seeing creeping land costs and a paucity of rental availability that is putting a lot of stress on the lower-income cohort of our population. As the working middle are pushed to New West, they are displacing the working poor and underemployed who need affordable housing within transit or walking distance from their jobs, their schools, and their support systems.

Unfortunately, this situation is getting worse at the same time that the largest community network of affordable family homes – Co-op Housing – is going through an existential crisis caused by the federal government cutting off support, and the provincial government failing to fill the gap (as is their constitutional role).
In the meantime, New West is doing what it can to get both market and non-market rental built as soon as possible, and to develop a new Official Community Plan that emphasises diversity of housing choice. Meanwhile, the Mayor has an Affordable Housing Task Force that is working on the best potential use of the affordable housing reserves, and the Mayor himself is working with the Metro Vancouver Housing Board to develop regional affordability strategies.

Not that I am disparaging of Vancouver’s idea. In this strangely super-heated market, coupled by a booming economy where everything but wages are going through the roof, we are going to need a variety of strategies to keep our region livable. Housing is a symptom of a larger economic malaise that points back to decades of neo-liberal economic “progress” where the building of wealth is prioritized over the building of society. But that is a talk for another day.

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