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Image: Daily Hive
Frances Bula in the Globe and Mail reports that the City of Vancouver will be requiring developers to ensure that roughly 25 per cent of units in new projects are “rented at rates affordable to those earning $30,000 to $80,000”. The City has faced some criticism for their eight year old “Rental 100” program that offered incentives for developers to build rentals, but also resulted in gaspingly high ‘low’ rents, including $1,360 for an east side studio. Developers will be offered an increased density bonus in exchange for the creation of affordable rental units.
Developers will be allowed to build this fall in an experiment to evaluate the effectiveness of 20 to 25 per cent of units being custom-built for affordable rental housing. Rents could range from $750 for people earning $30,000 to $2,000 a month for people earning $80,000.
Without the legal controls to reduce rents as in the United States, the Province has no regulation to give building owners a property tax break. Head planner Gill Kelley will experiment with increased density, lower parking requirements, and lower development fees to ensure a pro forma supportive of creating a building with 25 per cent affordable rental stock. Inclusionary zoning could also be contemplated, where developers are told outright that a percentage of the apartments in a building are for affordable rental in return for a density increase.
“Asked why his party did not move sooner on a policy like the one to be announced on Sunday, Mr. Robertson said Vision set precedents in the country with its previous incentives, which have boosted rental construction by hundreds of units a year, and with a rental-only zone in the Downtown Eastside.”
Is this too little too late? Frances Bula reports that the Mayor wrote the Urban Development Institute stating that new requirements were coming, and that they
should avoid over-paying for land in the current out-of-control market…We are writing to express concerns about the amount of speculative behaviour in the real estate market,” the mayor wrote to the Urban Development Institute on July 20. “The purchase prices we are seeing reflect a housing market that is disconnected from local economics, and will lead to proposals that will be challenged to meet the City’s requirements for affordability.”
Affordable rental policy will require another level of bureaucracy to ensure that the units are rented out correctly to those income scales, and the incomes monitored to ensure the rents are correctly adjusted-as well as managing what could be a very very long waiting list.