To get an idea of what Vancouver city council is up against when it comes to increasing affordable rental housing in the city’s affluent West Side, look no further than the fight brewing over a proposed five-storey Kitsilano apartment building. The modest development at West 2nd Avenue and Larch Street has unleashed a NIMBY backlash from neighbours who complain the building is too big and its suites too small. Never mind that under the Moderate Income Rental Housing Pilot Program, 20 per cent of the building’s suites will be affordably priced for renters earning between $30,000 and $80,000.
The pushback is happening at the same time as the city is rethinking another housing program, Rental 100, which offers developers incentives to build rental housing. There are problems with that program, which waives development cost levies to foster a greater supply of supposed affordable rental housing.
For starters, the rents are affordable in name only.
Rents in a recently approved Rental 100 building on the West Side will range from $1,646 for a studio to $3,702 for a three-bedroom, which, although slightly below market rates, are still unaffordable for many Vancouverites. It’s perfectly valid to question whether city resources should be used to subsidize housing for renters who arguably don’t need help.
Councillor Jean Swanson, council’s resident anti-poverty activist, not surprisingly wanted to kill that program, but her motion was defeated last week. Council sided with Sarah Kirby-Yung, who argued it would be foolish to end it without having something better to take its place. With no incentives to build rental, many developers would switch to building more expensive condominiums, she argued. Ultimately, council kicked the issue back to staff who are reviewing Vancouver’s entire housing strategy.
This is the right time for a rethink. Unlike social housing, where land and construction costs are funded by government, housing for middle-income earners is generally delivered by private developers, sometimes with the help of government incentives. When land prices hit record levels, affordability fixes for the “missing middle” require hefty subsidies or density bonuses. But now that the market is cooling, expensive condominiums are becoming harder to sell, and building rentals may become a more attractive option. The rich incentives required to sweeten the pot for developers five years ago may no longer be needed. Until city staff run all the numbers, it’s impossible to know. So, Ms. Kirby-Yung’s go-slow-approach was a good one.
We all know Vancouver desperately needs more social housing. But there is also huge demand for stable rental housing at all income levels, particularly for households earning $30,000 to $80,000 a year. So, what is the best approach? Suggestions are flying fast and furious.
Some say Vancouver should take advantage of powers recently bestowed by the provincial government allowing municipalities to zone for rental. But that isn’t going smoothly for New Westminster, the first municipality to try. Landholders are taking the city to court, claiming it is unfair for the city to devalue land they have owned for years. While that mess plays out, Vancouver could try a more cautious approach by implementing rental-only zoning in areas being rezoned for higher density to avoid developer complaints.
There is also growing enthusiasm for the city’s Moderate rental program, where developers are awarded extra density in exchange for renting 20 per cent of the suites at well below market rents. Councillor Adriane Carr prefers that option. It’s better to have buildings where a fifth of the suites are truly affordable than entire Rental 100 buildings offering rents only slightly below market rates, she says. But the Kitsilano example shows density doesn’t always go over well. And for small sites where the zoning does not permit extra storeys, the program isn’t feasible at all.
It’s obvious there is no one simple fix. The best approach may be what we already have: a little of this and a little of that. It may well be that a retuned Rental 100 program works best for some development sites. One thing is for sure: If Vancouverites truly care about affordable housing, they must endorse spending some tax dollars to get it and learn to love density.
It may sound like an oxymoron, but affordability carries a big cost.