Thank you so much for the opportunity to appear before the committee to discuss the proposed housing accelerator fund.
My name is Thom Armstrong. I'm the CEO of the Co-operative Housing Federation of British Columbia. CHF BC is a province-wide federation of housing co-ops. We serve 260 co-ops with more than 14,000 member households. We're also a group of social enterprises, including COHO Management Services and the Community Land Trust Foundation.
Our main offices are in Vancouver on the unceded territories of the Musqueam, Squamish, and Tsleil-Waututh nations. I pay my respect to the original stewards of these lands.
The government proposes to invest $4 billion in a new housing accelerator fund, with the goal of increasing housing supply in Canada's largest cities by removing barriers to building housing more quickly. I want to start by saying that whether this fund is successful in achieving its objectives will depend in large measure on how it's structured and, more importantly, how it's targeted.
In our view, the government should target its investment in the proposed fund to serve four main objectives. Firstly, build new homes that are permanently affordable to low- and moderate-income households, which are the households that are most acutely disadvantaged in local housing markets. Secondly, free up land for non-profit and co-op developers to reduce the cost of housing development. Thirdly, incentivize partnerships between municipalities and the community housing sector and its developers, such as Community Land Trust, to increase the supply of non-market housing in larger municipal centres. Finally, allow municipalities to prioritize the acquisition of existing, purpose-built rental properties by the community housing sector if and where it can be shown to achieve the same or similar net outcomes in affordable homes.
I'll speak to each of these very briefly.
First, on targeting, some citizens are clearly more challenged than others when finding affordable housing. There's scant evidence to suggest that investing in untargeted new supply will improve housing affordability. We suggest that disbursements from the fund should be made based on measurable performance targets tied to median rents and incomes, and reserved for homes that will not be investor-owned. As the cost of money, supplies and labour all increase—we're seeing this daily and weekly—grants will be needed to fill the equity gap that's currently a significant barrier to affordability. These grants can come from the fund or they can be combined with funds from other programs under the umbrella of the national housing strategy. The point is that they need to be stacked and they need to be automatic, not subject to individual or separate application processes.
Secondly, the fund should be structured to create incentives for municipalities to provide land at nominal rates to community housing developers. I know free land is not enough these days to guarantee affordability. I wish it was, but without it, we have no chance.
Thirdly, in some parts of the country—I'm thinking of Vancouver and Toronto—community land trusts and other social-purpose housing developers are leveraging partnerships with municipalities to build entire portfolios of permanently affordable non-profit and co-op homes. These homes become even more affordable over time as they're held out of the market and operated on a not-for-profit basis by capable, community-based housing providers. The funds should encourage an expansion of these partnerships to build even more permanently affordable homes. In Vancouver, our community land trust is in the process of adding 2,300 new non-profit and co-op homes to various communities in the province that start at an average of 60% to 75% of average market rents, and those only get more affordable over time.
Finally, I wouldn't have imagined I would be saying this if I had been speaking to this issue six or 12 months ago, but as financing and development costs continue to increase, it may be prudent in some markets and during some economic cycles to consider the acquisition of existing, purpose-built rental properties as a complement to new supply. The community housing sector has been advocating for the development of capital programs to facilitate the purchase of older rental properties that are currently targeted by real estate investment trusts and other investors, and deploying some of the fund's resources to this end may slow, if not reverse, this growing loss of affordable homes in overheated rental markets.
In summary, the housing accelerator fund can have a positive impact on housing supply and affordability, but only if it is tightly targeted to encourage the development of new homes that will be affordable to low- and moderate-income households, or to fund the acquisition of already affordable homes to move them out of the market into what one commentator called “speculation-free zones”.
Municipalities will not be able to go it alone. Partnerships with the community housing sector will be the key to the achievement of these objectives.
I want to thank you again for the opportunity to speak to this issue today.