January 16^th, 2005

Housing Articles

Affordable Housing

Historic Framework On A New National Initiative

On November 30, 2001, agreement on a major new federal/provincial/territorial joint initiative was announced that will have a significant impact on the supply of affordable housing for various groups in every region of the country.

Established by unanimous agreement of all the federal, provincial and territorial housing ministers, the initiative sets out a series of Canada-wide parameters intended to stimulate the production of affordable rental housing.

Under the terms of the affordable housing framework, each jurisdiction will sign a separate bilateral agreement with the federal government that reflects its unique needs and priorities within the framework.

At time of printing, seven such agreements have been signed by Canada Mortgage and Housing Corporation (CMHC), Canada�s national housing agency, and the governments of British Columbia, Northwest Territories, Nunavut, Quebec, Ontario, Alberta and Saskatchewan.

What it Means for Affordable Housing in Canada
Over the course of the next few years, the funds provided under the new program could go a long way towards helping address some of the country�s most pressing housing issues.

The Government of Canada is investing $680-million. With matching contributions from provinces, territories and others, total funds will be at least $1.36-billion.

Eligible affordable housing activities include new rental construction, major renovation or conversion, new home ownership and supportive housing. In addition, all housing that receives funding must be modest in terms of both unit sizes and amenities, and must remain affordable for a period of at least 10 years.

The federal contribution may vary from project to project, but is set at a maximum of $25,000 per unit overall. Provincial and territorial governments must match federal contributions, but these contributions can take various forms, and may come from sources including third parties.

Details of the Agreements Signed to Date
Within each region where agreements have been signed, the program is already being used to address priority affordable housing needs:

� British Columbia is using the funding for Homes BC, a non-profit housing program for low-income people including persons with disabilities, as well as to create supportive housing for seniors.

� Northwest Territories is funding home ownership and rental housing for seniors and single persons in core housing need.

� The Nunavut agreement contemplates funding for down payment assistance, assisted rental housing, affordable rental housing and housing renovation activity.

� The Quebec agreement involves creating non-profit and private housing geared to low- and moderate-income households.

� Ontario is using the funding for new rental housing, home ownership in urban neighbourhood revitalization areas, and rental or ownership housing in remote areas.

� Alberta is supporting affordable housing for low-income families, sustainable housing in remote areas, as well as housing for individuals with special needs.

� Saskatchewan will use the funding for capital grants to reduce the cost of rental housing and home ownership.

Looking Ahead
While the program is intended to provide some immediate relief from low vacancy rates, the framework reaffirms a commitment by governments to examine longer-term strategies for affordable rental housing. A joint working group is currently examining improvements to the climate for rental investment, by removing obstacles to affordable housing development. The intent is to bring the private sector back into the business of new rental construction to meet future demand.

In this way, the new agreement will both address the immediate rental housing needs of Canadians and continue to work to stimulate the supply of affordable rental housing for all Canadians in the future.

(For more information on this landmark initiative, or for information and advice on housing, visit the Canada Mortgage and Housing Corporation website at www.cmhc.ca. You may also contact your province or territory for program details contained in the bilateral agreements.)