Government must invest in the best options — co-op and non-profit housing
Thom Armstrong
Sun
When Housing Minister Rich Coleman unveiled the government’s new housing strategy earlier this month, he missed a golden opportunity to address the biggest problem in British Columbia’s hot real estate market — the dwindling supply of affordable rental housing.
Instead, Coleman introduced a new rental assistance program, featuring portable housing allowances for low-income working families.
There’s no doubt that the new program will help some renters. Under the right conditions — a stable supply of rental housing and healthy vacancy rates being the most important — housing allowances can be effective as part of a broader housing and income supplement strategy. On its own, a housing allowance scheme is more likely to be too little help for too few in need.
Consider a family of four earning $22,000 a year. By the government’s measure, an affordable rent for that family is $550 a month. They may be forced to pay twice that or more in today’s market, but they won’t qualify for help under the new program because they earn too much.
They’re not alone. More than 61,000 households in B.C. spend more than half of their income on rent. More than 14,000 households remain on the BC Housing waiting list.
The problem seems obvious enough: There’s not enough affordable rental housing to go around. In fact, the rental housing supply is shrinking, as older stock is redeveloped to build condos or renovated so that landlords can raise rents. Recently the city of Vancouver reported that the south Granville area has lost more than three per cent of its rental stock in the past year.
The solution seems just as obvious: The government must invest in a continuing supply of affordable rental housing. And its best option, by far, will be to build more co-op and non-profit housing.
The knock on housing supply programs is that they’re expensive and take too long to deliver results. Besides, critics claim, it’s the private sector’s job to build rental housing.
But the market hasn’t supplied affordable rental housing for decades. And for good reason — it’s not profitable. Housing co-ops, on the other hand, have a 35-year track record of affordable housing in healthy, mixed-income communities. They work because their goal is to provide affordable housing to their members, not to deliver a profit to shareholders.
Is it more expensive to invest in new housing supply?
At least one recent study suggests that, over time, building new affordable housing is cheaper than maintaining a housing allowance program. And critics of supply programs rarely mention the health and other social costs of failing to ensure that people have a safe, affordable place to live.
Of course it will take longer to build new housing than to mail someone a housing allowance cheque. That’s hardly an excuse for further delay.
We all know that the best time to plant a tree was 20 years ago, but the next best time is today. And having a longer-term strategy in place to deal with the longstanding problem of housing supply just seems like good planning.
For a sobering look at what happens when governments don’t think that housing supply is a priority, one need only read the media reports from Alberta, where people with full-time jobs are living in cars because they can’t find any other place to live.
We have the means to act now on the housing supply problem. Government revenues are healthy. The co-op and non-profit housing sectors have proven track records in building and managing affordable homes. BC Housing is the most effective government housing agency in the country. And the federal government has just pledged an additional $106 million in housing funds to the province.
Coleman should take immediate steps to increase the supply of affordable housing by investing in a new co-op and non-profit housing program. Perhaps then the new rental assistance program will be seen as a useful transition to a long-term housing strategy long after it is swallowed up in the next round of market rent increases.
Thom Armstrong is executive director of the Co-operative Housing Federation of B.C.
© The Vancouver Sun 2006
