It used to be that governments would build public housing, in effect bare bones apartment buildings or townhouses, with subsidized rents, for those who couldn’t otherwise afford to rent or buy. It has come to light recently in Nova Scotia that many of these units are vacant, because it takes forever to do the repairs when long term tenants move out. Other units were built for families and are now occupied by single senior citizens, because nobody wants to evict them from their home, so the capacity is greater than the occupancy. Other units have been occupied for years by people who needed a leg up way back in the day, but now have a good income and are simply happy to enjoy the low rent. The bottom line seems to be that the public housing stock has been mismanaged. Lots of people on the waiting list while there are lots of empty units and under occupied units. Nothing new gets built, even though the demand is there.
More recently, the buzzword is “affordable housing”. The idea seems to be that government will bribe landlords to provide a certain number of units at a reduced rent. Considering how long this latter strategy has been operational, I would love to see a report telling me how many units have been created and what effect it has had in meeting the need. My sense is that landlords pay lip service to the concept, other tenants aren’t happy that some folks are getting subsidized rents, and nobody is overseeing the entire mess. It wouldn’t surprise me to learn that the affordable units never actually “happen”.
If some level of government wants to make something happen in a hurry, they should build a bunch of public housing and then manage it properly. It’s visible, manageable, affordable, and can be quite standard in terms of design, etc., so there are probably economies of scale.
In Ontario "Affordable Housing" gets built. Sounds wonderful? Don't get too excited.
A developer builds a 347 unit apartment building. The building will include 105 "affordable" units in return for a government grant of $3 million dollars and a low-interest government loan of $70 million and the city will waver the development fees (another $8.4 million.). The developer enjoys big savings on the construction costs.
The building's owner gets to decide who he will rent to. Why can't he rent to family, friends, follow church members and employees? If you don't have any of them, rent to people of means, people who will easily afford to pay their rent on time. People who are struggling, have poor credit ratings or are new immigrants are far more risky.
It gets better. "Affordable rents" is pegged at 80% of the average market rent for the municipality. In Ontario, new builds (after November 2018) are fully except from rent controls.
So, keeping the numbers simple, when the building opens, a one-bedroom costs $1,000 a month in rent plus utilities and parking. The affordable units rent for $800 a month plus utilities and parking. A year later, the average rents in the municipality went up by 10%. The occupants of the "affordable units" now pays $880 a month in rent. In year two, the rent may be $968.
In year three, if the average rents go up by only 6%, the rents for the "affordable" units are now $1,026.08. Every time the rents for the regular units in this building go up, they help pull the rents of the "affordable" units up with them.
What is needed is apartments whose rents are "Geared To Income" (30% of household income). In other words, social housing. There are very few social housing buildings being built today.
More bad news. Seniors living in the existing social housing buildings are suffering. The federal government and the municipalites give housing priority to certain classes of homeless people including active drug addicts, those who have serious mental illnesses and those who have "complex needs". Persons on the priory lists are given social housing units when they become available. (Got to get your stats up.)
Social housing which have a long troubled history of crime and neglect are getting far worse for many of the residents.
It used to be that governments would build public housing, in effect bare bones apartment buildings or townhouses, with subsidized rents, for those who couldn’t otherwise afford to rent or buy. It has come to light recently in Nova Scotia that many of these units are vacant, because it takes forever to do the repairs when long term tenants move out. Other units were built for families and are now occupied by single senior citizens, because nobody wants to evict them from their home, so the capacity is greater than the occupancy. Other units have been occupied for years by people who needed a leg up way back in the day, but now have a good income and are simply happy to enjoy the low rent. The bottom line seems to be that the public housing stock has been mismanaged. Lots of people on the waiting list while there are lots of empty units and under occupied units. Nothing new gets built, even though the demand is there.
More recently, the buzzword is “affordable housing”. The idea seems to be that government will bribe landlords to provide a certain number of units at a reduced rent. Considering how long this latter strategy has been operational, I would love to see a report telling me how many units have been created and what effect it has had in meeting the need. My sense is that landlords pay lip service to the concept, other tenants aren’t happy that some folks are getting subsidized rents, and nobody is overseeing the entire mess. It wouldn’t surprise me to learn that the affordable units never actually “happen”.
If some level of government wants to make something happen in a hurry, they should build a bunch of public housing and then manage it properly. It’s visible, manageable, affordable, and can be quite standard in terms of design, etc., so there are probably economies of scale.
In Ontario "Affordable Housing" gets built. Sounds wonderful? Don't get too excited.
A developer builds a 347 unit apartment building. The building will include 105 "affordable" units in return for a government grant of $3 million dollars and a low-interest government loan of $70 million and the city will waver the development fees (another $8.4 million.). The developer enjoys big savings on the construction costs.
Read: https://sudbury.substack.com/p/the-manitou-project-over-the-past
The building's owner gets to decide who he will rent to. Why can't he rent to family, friends, follow church members and employees? If you don't have any of them, rent to people of means, people who will easily afford to pay their rent on time. People who are struggling, have poor credit ratings or are new immigrants are far more risky.
It gets better. "Affordable rents" is pegged at 80% of the average market rent for the municipality. In Ontario, new builds (after November 2018) are fully except from rent controls.
So, keeping the numbers simple, when the building opens, a one-bedroom costs $1,000 a month in rent plus utilities and parking. The affordable units rent for $800 a month plus utilities and parking. A year later, the average rents in the municipality went up by 10%. The occupants of the "affordable units" now pays $880 a month in rent. In year two, the rent may be $968.
In year three, if the average rents go up by only 6%, the rents for the "affordable" units are now $1,026.08. Every time the rents for the regular units in this building go up, they help pull the rents of the "affordable" units up with them.
What is needed is apartments whose rents are "Geared To Income" (30% of household income). In other words, social housing. There are very few social housing buildings being built today.
More bad news. Seniors living in the existing social housing buildings are suffering. The federal government and the municipalites give housing priority to certain classes of homeless people including active drug addicts, those who have serious mental illnesses and those who have "complex needs". Persons on the priory lists are given social housing units when they become available. (Got to get your stats up.)
Social housing which have a long troubled history of crime and neglect are getting far worse for many of the residents.
https://www.cbc.ca/news/canada/thunder-bay/thunder-bay-paterson-court-rally-1.7123053