Home ownership creates the kind of financial security that
benefits Canadian families and Canada as a whole. It supports the economy of
cities; it helps people prepare for their retirement; it frees up affordable
rental housing in tight urban markets; and it builds a stable middle class.
Canadians value the opportunities and security home ownership creates.
Unfortunately, for many Canadians, home ownership is a dream
increasingly out of reach. Home prices are increasing rapidly, yet median
incomes are not. The Toronto Real Estate Board reported that home prices are up
23% from just last year. This trend keeps younger Canadians, low income families
with children, and key workers further away from home ownership. There are more
than 200,000 middle income earners (teachers, social workers, paramedics,
nurses, etc.) who want to own a home but are unable to access the private
ownership market (Canadian Urban Institute, 2016).
Non-profit ownership housing organizations, like Options for
Homes, are working to remedy this issue. While the Options model doesn’t rely
on government funding, we can be even more effective with increased support
form the federal government. The National Housing Strategy, set for release in
early 2017, must include a scaling up of affordable ownership housing - not
just affordable rentals - for a
comprehensive solution.
RECOMMENDATIONS: ACCESS TO CAPITAL AND ACCESS TO LAND
1. ACCESS TO CAPITAL
A significant barrier to scaling up production of affordable
ownership housing involves access to funds for land acquisition,
pre-construction costs (including consulting fees), marketing, and municipal
permits.
The federal government should provide a $250 million
revolving loan fund that would provide both short and long term project equity
and be available to qualified non-profit producers.
The loans would be seeded by government, replenished by
paybacks and require no ongoing financial commitment from government.
2. ACCESS TO LAND
Provincial and municipal governments should establish and
administer an Affordable Housing Land List and identify actionable public
lands suitable for sale to registered non-profit housing organizations.
The key benefit of public land being sold to non-profit
housing producers is so they can acquire it at an ‘appraised market value’
prior to it being placed on the open market, allowing them to defer payment for
the land for a period to be negotiated between the non-profit housing
organization and the government. This enables non-profits to access land, while
the government also receives full value for the asset.
Scaling up ownership housing initiatives addresses many of the
reoccurring themes and issues outlined in the federal What We Heard
summary – establishing a broader continuum of affordable housing for a variety
of needs and markets, and improving access to housing, especially for
first-time home buyers. Our hope at Options for Homes is that the National
Housing Strategy does indeed support low and middle-income families ready to
achieve the goal of homeownership and the non-profit affordable housing
providers that are ready to help.
