Affordable homeownership is possible. It's worth talking about, says housing advocate Kishone Roy

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      The gap between renting and owning a home appears to be growing wider every day.

      Kishone Roy makes this observation in unpacking a post that the housing advocate recently made on social media.

      In essence, Roy wrote on Twitter on March 13 that there has to be a big conversation some time soon about affordable homeownership.

      As many know, affordable and homeownership are two words that don’t often go together. But as Roy noted, “Whether people can afford to buy or rent should be an option that they have in their lives sometime.”

      “But right now,” the former CEO of the B.C. Non-Profit Housing Association (BCNPHA) told the Straight in a phone interview, “there is a great big gap between rental and homeownership.”

      It’s a situation “caused by increased housing prices, caused by the increased size of the down payment that’s needed, [and] caused by low interest rates that make it harder to save for a down payment”.

      However, renters shouldn’t be left on their own to navigate that gap. Otherwise, there will be continued pressure on the rental market, where there isn’t much supply in the first place.

      Many renters require a hand to make a hop into homeownership.

      “To make that leap, you need AHOP, an affordable-homeownership plan or program,” Roy said.

      Roy said this is because if there is one lesson to be learned from the private housing market, it’s that it will “not create any affordable-homeownership options for people”.

      “It’s now time to look at other solutions,” said the author of 2017’s Make Housing Central: British Columbia and the Affordable Housing Crisis.

      Roy also noted that it may surprise people to learn that there are already affordable-homeownership projects in existence.

      One example is the Rising Sun Villas, a six-storey residential building located at 13969 100 Avenue in Surrey.

      Phoenix Society, a nonprofit, opened the project in 2015. It includes 23 units of affordable-homeownership units. It also features transitional housing for men and women dealing with addictions, as well as those reintegrating into society following their involvement with the justice system.

      The development received support from Vancity (Vancouver City Savings Credit Union). Online, Vancity relates that the project created the first “shared equity model” in B.C.

      The way this model works is that when an owner sells, a portion of the equity stays with the unit. This means that future owners also benefit from the increased value of the property.

      Roy cited the Whistler Housing Authority as another example. The agency uses covenants on titles to keep ownership homes affordable and available to local buyers. The municipality also exercises the right of first refusal when it comes to selling the properties.

      B.C. Housing compiled a number of such examples in an October 2017 paper titled A Scan of Leading Practices in Affordable Housing.

      One can be found in Langford. The Vancouver Island city’s affordable-housing program requires new subdivisions to build one affordable unit for each batch of 10 single-family lots. Qualified buyers must consist of at least two people, with a household income under $60,000.

      Also, purchasers should have lived in Langford for two years. The price of the home is capped for five years and increases only slightly after that period.

      As part of the province’s 2018 budget, the B.C. NDP government announced that it would help build 114,000 units of affordable housing. These include market and nonprofit rental, supported social housing, and owner-purchase units.

      The province will deliver these housing units through partnerships. To do this, it is devoting $7 billion over 10 years, an amount described as the “largest investment in housing affordability in B.C.’s history”.

      Also in 2018, the B.C. NDP government unveiled its HousingHub, which will bring a variety of stakeholders together.

      The hub’s mission is to get two major programs going: the Provincial Rental Supply program, and the Affordable Home Ownership Program (AHOP).
      B.C. Housing has also developed a framework for AHOP. In January 2019, the provincial agency released a paper about the program, explaining that it will help households to access “construction financing at reduced rates”.

      The program also seeks to leverage land and other contributions from project partners.

      According to the AHOP framework paper, units will be made available at five to 20 percent below market value. The difference will be secured by an AHOP mortgage on the title.

      When asked about B.C. Housing’s affordable-homeownership program, Roy indicated interest in seeing more details.

      “They’re currently engaged in trying to come up with more solutions,” Roy said, “but what I don’t see is a plan that says how many units are going to be built where and for what price.”

      The bottom line for Roy is that people should know that affordable homeownership is possible and can be done through different forms of AHOPs.

      “It’s a real thing, and worth talking about,” Roy said.