"St. John's will be a vibrant, inclusive and thriving city with a wide range of affordable housing options that contribute directly to community health, sustainable growth and economic security."
That's the vision statement for the City of St. John's Housing Charter, and it is the foundation of the City's new Affordable Housing Business Plan approved by Council this past Monday, June 9.
There has been a lot of talk about what "affordable housing" means. Many people think it means "subsidized housing" - governments or other organizations provide funding to offset the cost of building or living in a home.
This new Business Plan lays out strategies to encourage the market to provide more housing options.
But in today's booming economy housing prices have skyrocketed, pushing many more people out of the market. Incomes above $32,500 are not eligable for subsidies, yet many households have to earn upwards of $82,500 in order to find housing considered "affordable."
For housing to be considered affordable, it must cost less than 30% of pre-tax income including housing and related costs. This Business Plan seeks to promote the creation of more housing choices that are affordable to a wider range of people according to the 30% criteria.
Many groups are impacted by today's housing crunch. There are students trying to afford a tuition and a place to live; families on multiple incomes can still have trouble affording a mortgage down payment; and our fastest-growing demographic, seniors, usually receive a reduced income upon retirement and are looking to downsize their homes.
The City recognizes this issue and feels it has a role in ensuring everyone can afford housing. This new Business Plan lays out strategies to encourage the market to provide more housing options.
First and foremost, the City is a facilitator. We have working relationships with numerous government and non-government organizations who are already working to address this issue. We can bring together and coordinate these groups to ensure we're all rowing in the same direction.
Second, the City already plays important roles in the housing market. We set land use requirements, development regulations, and enforce various building codes and by-laws. We own land and set tax rates. And we can access funding from our budget to leverage more money from other levels government and organizations to maximize our investment.
Finally, we have staff and consultants that plan and design subdivisions, which presents opportunities to incorporate multiple housing types, meaning a variety of prices. As we review and adapt our development regulations to match our new Municipal Plan, we can explore "Alternative Development Standards" that encourage mixed uses and better neighbourhoods in a cost-effective manner.
The City of St. John's has already begun implementing the Business Plan. For example, the Plan calls for an "affordable home ownership pilot project" which will see the City coordinate the design and build of a mixed-use neighbourhood.
To accomplish this, the City identified a piece of City-owned land that is appropriate for neighbourhood development. We put out a call for proposals for a development plan. The Canada Mortgage and Home Corporation (CMHC) will provide $10,000 in seed money to the winning proponent to help them develop their proposal further before development begins.
There is much more we can do, and the Affordable Housing Business Plan will help us achieve it. With a target to create 500 affordable homes in St. John's by 2017, it is not one that the City can meet on its own. This is the benchmark that will guide and inspire the action of all the City's partners as we work together to address housing needs in our community.
The importance of housing affordability to our overall economy cannot be understated. Our lack of affordable housing options makes it more difficult to attract new talent, frustrates our efforts to keep new Canadians here to fill our labour gaps, and it puts a lot of financial pressure on the households of the workers who drive our service industry sector (which comprises over 25% of our local economy).
It's not just people on the margins: More than 30% of the population is in this housing crunch, and I'm proud that our City is playing its part to ensure everyone can afford a place to live.
Click here to read the full Housing Business Plan at the City's website.