Our region has a housing problem. A big one. There simply aren’t enough affordable homes for those who need them and its affecting people’s lives, our economy, and the viability of our communities.

The current housing development model is failing to meet the needs of huge sections of the population, particularly renters.

Some are lucky enough to be able to afford market-rate rents, even in a region with near-zero vacancy rates. At the other end of the scale, government-funded social housing puts a roof over the heads of some (though by no means all) of the most vulnerable people in society.

But what about those in the middle? People who can’t afford market rents but don’t qualify for social housing are being priced out of the rental market.

The scale of the problem is daunting, especially when it comes to rental housing. B.C.’s Affordable Housing Plan identifies a need for 80,000 more housing units to address the backlog in rental housing.  It also calls for about 7,000 new rental housing units per year for each of the next 10 years to account for population growth.

That’s a lot of housing. Who’s going to build it? And where will the money come from?

The Vancity approach

Vancity may have some answers, although I should stress there are no quick fixes to what is a complex and long-standing problem. But we have developed a model for building affordable rental housing costing no more than 30% of gross income for families, seniors and individuals earning between $30,000 and $80,000 a year.

It’s a solution that we believe can have a significant impact on the affordability issues facing our communities.

Here’s our approach in a nutshell:

1. We work with owners of community land (local churches, for example) to build their vision and concept and we keep that land community-owned. That means little to no up-front payment for the land.
2. As a financial co-operative, we provide the financing to develop and build affordable housing at a reasonable cost. We’ll still earn a return so it is profitable for us and our members, but less than a market real estate deal.
3. We partner with great not-for-profit developers who understand the importance of affordable rental housing in our communities and are motivated to build it.

We plan to provide 1,800 units of affordable rental housing in the next two to three years through this approach.

We are doing this because we believe that government and the market on their own can’t solve the complex housing problems we face. Instead of relying on government programs or profit-driven developers to build the affordable housing our region so desperately needs, we are using a range of grants, loans and investments to help not-for-profit and Indigenous organizations do it instead.

From concept to reality

Here’s how it works.

We know that the hardest time to secure capital for an affordable housing project is before the zoning and development approvals are in place, when there’s still a high level of risk that it may not happen. To address that, we’ve developed programs to help not-for-profit and Indigenous organizations get those approvals and bring their affordable housing projects to the pre-development stage. Our program provides grant support to help organizations:

• Articulate the vision
• Determine feasibility
• Create a business plan.

At that point, not-for-profits and Indigenous organizations can access Vancity’s revolving Pre-Development Loan Fund to move their projects through the approvals process and get ready to begin construction.

Once a project is ready to build, Vancity provides further financing for construction. We also provide financing for renovations and consolidating debts.

Proven results

Since 2011, Vancity’s affordable housing program has generated more than 1,900 units of purpose-built, community-owned affordable rental stock across the region.

Some examples of not-for-profit developers who’ve benefited from the program include:

• Catalyst Community Developments Society – 310 units in Vancouver, 82 units in Langley and 55 units in Port Moody
• Greater Victoria Housing Society – 274 units in Victoria
• Mount Douglas Seniors Housing Society – 84 units in Victoria
• Semiahmoo House Society – 71 units in Surrey

Our program creates affordable housing for those on low and middle incomes and helps to build a stronger and financially self-reliant affordable housing industry. At the same time, it generates financial returns for our credit union and social and environmental benefits for our communities.

We’re confident that the concept is working, but given the need that’s out there, the challenge now is to do more of it. Much more.