Tag Archives: habitat for humanity
With more than 60,000 households waiting for low-cost housing, Toronto politicians should stop driving up costs
Marcus Gee – Globe and Mail
Everyone agrees that something has to be done about affordable housing. The question is whether it is governments that should be doing it.
The consensus in city politics is yes, of course they should. Private developers and landlords, it is argued, will never supply enough reasonably priced housing for lower-income people. Developers prefer to build luxury condos. So governments simply have to step in to correct this market failure.
When the non-profit housing group Habitat for Humanity invited mayoral candidates to debate the issue on Tuesday evening, they were full of ideas for new, more vigorous ways for government to tackle the problem.
Joe Pantalone would push ahead with a plan to build 1,000 affordable housing units a year. George Smitherman would encourage home ownership, free up city-owned land for affordable housing and partner with non-profits to build more units.
Rocco Rossi, too, would use city land resources, while Sarah Thomson talked about using a “density bonus” that would allow developers to build higher density if they agreed to provide affordable housing. Giorgio Mammoliti would push ahead with a 10-year, 67-point, $484-million plan for affordable housing. Only the inimitable Rob Ford suggested that instead of supplying more housing, the city should give tenants more rent subsidies to help them rent units in private apartments.
The desire to do something big and ambitious about affordable housing is understandable. With more than 60,000 Toronto households on a waiting list for low-cost housing, a 15-per-cent increase since last year, there is clearly a need.
But most studies have found the private sector is better than government at tackling the problem. A recent report by the Conference Board of Canada said that, while governments had a significant role to play in providing affordable housing, “private companies are the most efficient at innovating to drive down shelter costs when markets are competitive. They have the best economies of scale and the core competency to deliver housing to the marketplace.” It also noted that previous reports found that “governments had significantly added to the cost of shelter through a wide variety of direct charges and zoning practices.”
Quite so. Taxes, development charges and new measures such as the city’s land transfer tax have made it hard for many developers to make money on anything but high-end projects. The Planning Act’s Section 37 measure, for example, allows the city to wring “community benefits” such as park or street improvements from developers in return for permission to build.
Now there is talk of an “inclusionary zoning” rule that would require developers to put aside a certain proportion of new housing units for affordable housing. A private member’s bill recently before the Ontario Legislature would give municipalities the right to require it. Ms. Thomson and Mr. Mammoliti are among those who support the idea, which would amount to another tax on developers.
Designed to address the affordable-housing problems, measures like this could make it worse instead, driving up the cost of housing when developers pass on the cost of various charges and regulations to home buyers and renters. As an added down side, new home buyers end up paying the freight for a social measure that would better be borne by society at large.
Economic consultant Peter Norman of the Altus Group says: “I always ask the rhetorical question: ‘Why is it the government feels the private sector isn’t prepared to bring forward housing that serves the lower-income segment in the population?’ “
It’s not because developers are all Scrooges. It’s because they can’t make a buck at it in the current environment. Sensible government policy would aim to free them up to supply the affordable housing that the city obviously needs.
Ambitious project eventually will be transformed into 2,100 housing units
Anna Mehler Paperny – Globe and Mail
In a fourth-floor conference room at the Board of Trade’s Adelaide Street headquarters, a well-heeled group of Toronto’s city-building elite watches a slideshow of the city’s mission impossible.
The clock is ticking on one of the most ambitious residential projects in the city’s history: a billion-dollar athletes village for the Pan American Games that will eventually be transformed into 2,100 housing units. Developers are intrigued – and leery of a model that’s largely untested here.
Building an athletes village doesn’t sound like a big deal. Except when it’s three times the size of the one that saddled Vancouver with an unexpected price tag and is one of Toronto’s most challenging residential projects in terms of units and the tight time frame. It comes with an armload of prerequisites (including hundreds units of affordable housing and an as-yet-undetermined mix of student housing, rental and market-rate condos the developer will provide) and a long list of people to please.
“I thought it was extremely ambitious. That’s a lot of housing to be built in one fell swoop,” says Howard Cohen, principal of Context Development. Like just about everyone else at the information session, he’d like to know what exactly the plan will be. And, specifically, where the money to finance the construction will come from: Traditionally, developers sell the majority of their units in advance – it’s difficult to get bank financing otherwise. But for a village that will be first leased out to more than 8,000 athletes, coaches and officials, that could get complicated.
“If we’re to build these things and assume the liability, then it’s quite a risky proposition for a builder to come along, build the entire building and then sell these things after the Games,” said Joe Cordiano, a partner with Cityzen condo developers.
Even Waterfront Toronto doesn’t yet know how this project will roll out. A “market-sounding” exercise, headed up by consultants from Deloitte and Scotia Capital, launched on April 23. The aim is to test the waters of Toronto’s notoriously overheated housing market and determine whether there will be demand for 2,000 units of high-end waterfront condos five years from now.
The recommendations they bring back will inform the plan Waterfront Toronto brings to city council and, ultimately, the task handed to developers early next year, said Waterfront Toronto president John Campbell. Once the contract is awarded and design completed, the developer will have just under three years to sell, finance and build the village, not necessarily in that order.
When Toronto was awarded the Games last November, it kicked a dawdling, multi-decade urban reinvention project into high gear: A 25-year timeline shrunk to five; the city has until early 2015 to hand over a completed athletes’ village it hopes to showcase to the world.
John van Nostrand, the principle architect behind the original bid design that helped Toronto win the Games, has big things in mind for the residential community that will help define the long-dormant Don Lands after the athletes pack up and leave.
What he’d really like to see in addition to the 20 per cent affordable housing planned is “affordable ownership” that gives lower-income families a chance to own their homes, usually by having a third party take out a second mortgage.
It’s a complex model Toronto is testing – the Daniels Corporation is partnering with Habitat for Humanity on a couple of developments in the city; ArtScape is trying to do the same thing with live/work spaces for artists.
“It needs special consideration. … That’s a relatively untested concept here,” Mr. van Nostrand said. “London and New York get involved because that kind of housing houses the teachers, the nurses, the bus drivers, the garbage truck drivers. And you want those people to be able to live in the city. If they can’t afford to live in the city, you’re in trouble.”
But it’s still not clear what the 20 per cent “affordable housing” pledge will mean.
“Affordable’s a very loaded term,” Mr. Campbell said. “Our definition is about average rent. It’s to ensure that when we’re building a community there’s housing for everybody.
It’s an exciting project, Mr. Cohen says. But in many ways it’s a first for Toronto, and the country.
“We haven’t had very many of these in Canada. The Olympics in Montreal, all the housing was built by the Olympics organization and then sold off afterwards,” he said. “This is the biggest concentration of housing, ever, in Toronto to be built all at once.
“So it’s really ambitious. And I hope it’s done well.”
Habitat for Humanity tries a new model
Anna Mehler Paperny – Globe and Mail
Habitat for Humanity plans to acquire affordable units in one of the city’s newest, shiniest condo developments – a 443-unit condominium tower nestled up against the ambitious Toronto International Film Festival Centre.
It will sell them at a small fraction of the price of the building’s other condos. That’s the new model for affordable housing – a partnership of private and not-for-profit when government-funded programs aren’t cutting it and Toronto’s backlog of people waiting for affordable housing is stretching into the tens of thousands.
But projects like these are officially ineligible for a city policy requiring developers to give back to the public realm, because the condos wouldn’t be publicly owned.
The Widmer Street initiative is in its nascent stage, emphasizes Neil Pattison, manager of development for Daniels Corp., the developer spearheading the project.
It still hasn’t been determined how many units Habitat will get, or how big they will be, and the details won’t be hammered out until well after excavation begins in July. It will be on a tiny scale – just one or two units out of several hundred.
The arrangement is one the city is trying to clone: Habitat will take out a second mortgage on the units in question, which Daniels is providing at cost, at about 80 per cent of market rate. That brings the price for residents down to about $120,000, which they pay back over 25 years. As they pay off their mortgage (which comes equipped with an “anti-flip” clause to prevent anyone from selling the unit for massive profit), Habitat puts that money into buying more, Mr. Hetherington said, “and it just keeps on going.
“It means we can have folks who are serving coffee at Tim Hortons be able to live close to their work.… When you change that financing, you remove the interest. You bring about hope and dignity.”
As utopian as it seems, Mr. Hetherington says, it’s vital that projects making homes financially accessible take place in the pricey downtown core. “Affordable housing can’t be pushed out to the outskirts of the city,” he said.
Daniels’ Mr. Pattison said they originally tried to have the initiative count towards its obligations under Section 37, a provincial statute that requires developers to provide cash for community benefits in exchange for extra density or zoning changes from the city.
This usually translates to about $8 or $9 per square foot, and traditionally ranges from sidewalk improvements to parks and public squares. In the case of large-scale projects like these, it can total upwards of $1-million. But initiatives like what Habitat for Humanity is proposing don’t qualify because the city doesn’t own the properties in question.
“I can understand why the policy’s there, but when you’re trying to do some good on the ground, it’s difficult,” Mr. Pattison said.
Councillor Adam Vaughan, who hopes the Widmer Street development will be the centre of a “cultural corridor” in his Trinity-Spadina ward, said that red tape has to change. It was originally put in place to prevent a diminishing rental-housing stock from being converted into far more lucrative condominiums.
But it has the unintended opposite effect: It prevents developers from getting credit from the city for trying to make their condos accessible to those outside the ultra-elite.
“At some point you run out of sidewalks to build and parks to fix.… When [a site goes] from being a six-storey building to a 30-storey building, we need to find ways to take a slice of that and turn it into affordable housing,” he said, adding that he hopes to change the city’s policies to make it easier for third parties to facilitate cheaper places to live.
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