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The townhouse where Paulo Horta, his wife Nadine Roth and their children, Gabriel and Rafael, live is a small piece of residential paradise. It is set amidst the forested part of Burnaby Mountain; the spires of tall evergreens soar above the roofline on one side of the 60-unit complex, called Verdant. A warm, sappy smell drifts out from the trees on hot summer days. From the upper decks of the four-storey buildings, you can look out to a skyline of blue-rinsed mountains on one side or, on the other, the ridge of central Burnaby, with Mount Baker beyond it. The townhouses are built around a small rectangular courtyard with a sandbox in the middle that’s heavily used by the kids who live there. The concrete planters nearby bear testimony to their artistic efforts with chalk. Today, a holiday Monday, Gabriel sits solemnly studying the artificial turf near the sandbox, while his father talks with a neighbour about berry-picking expeditions (hers) and trips to Ikea (his) while older kids exit stage left with their bikes.

It’s hard to imagine that this development, with its designer palette of creams and greys accented with pumpkin-coloured doors, is related in any way to a very different looking set of buildings 20 kilometres away. The Little Mountain social housing project, a collection of dilapidated rectangular blocks scattered across a large grass field at the foot of Queen Elizabeth Park, looks like Vancouver’s best attempt at recreating an abandoned eastern European orphanage. Sheets hang over many of the windows, and the only sign of life is the woman tending a yard sale of china and knick-knacks on one patch of grass facing Main Street. But as different as these two little quadrants of the Lower Mainland may seem, Horta’s home, which is part of SFU’s UniverCity development, does have a connection with Little Mountain. It’s not quite the grandchild, perhaps, but at least the second cousin once removed of Little Mountain, which was once seen as a model of good social engineering and modernist architecture. Little Mountain was built in 1954, the result of 50 years of agitation for affordable homes and the more immediate crisis of returning soldiers from the war, who were occupying buildings such as the Hotel Vancouver to protest the fact that they couldn’t find anyplace to live. The benchmark project, by the then-new Central Housing and Mortgage Corp. (now Canada Mortgage and Housing Corp.), launched four decades of energetic government-supported construction in Vancouver – all of which disappeared in 1993, when the federal government decided to get out of the business of building subsidized housing. The problem of finding low-cost homes for those who can’t quite get a handhold in the strictly private market would not, however, go away. Fifty years ago, it was veterans who every­body worried about housing, but today it’s teachers, nurses – and even, in this new century, double-income university professor households. Verdant is SFU’s solution to one of the university’s most persistent problems: finding affordable housing for its 6,000 faculty and staff. Desirable potential employees, offered jobs at the campus, would often come to take a look around, discover the price of local housing and say, “Thanks, we think we’d rather go to one of the other universities offering us work.” So SFU, which was in the process of developing an otherwise private-market housing complex on the land around its campus, worked with Vancity Enterprises Ltd. to include the Verdant project. At Verdant, faculty and staff get to buy their townhouses or apartments for 20 per cent below the fair-market value. In exchange, the buyers have to agree to live in them, offer them to the university first when they sell and agree to get only 80 per cent of the sale price when they move. That way, the people who buy still make a little money from the rising real estate market, but the university gets to keep recycling a stock of lower-cost housing forever, managed by its community trust. So Horta and Roth, professors in, respectively, world literature and German history, got to buy this townhouse that they moved into last May – three bedrooms, 1,200 square feet, brand new and built according to the latest environmental standards – for $290,000. Its real value was calculated at about $360,000; other places nearby were going for as much as $450,000. “We would never have been able to get into the housing market without this,” says Horta, as we walk through the fragrant woods behind his place. [pagebreak] Verdant, unique in the Lower Mainland to date, is something that former Vancouver planner Larry Beasley calls the way of the future: a new kind of “third-sector” housing solution that doesn’t rely just on government (like social housing did) or on the private sector. As affordability becomes a much more significant problem in Vancouver, the region may be seeing more Verdant-style projects and variations on it in the near future, along with a host of other creative experiments. SFU is far from alone in (desperately) trying to find a way to play with the levers of the housing market for middle-income earners, a pillar of the economy that represents just under half of the region’s households. Places as different as London, Madrid, Florida, St. Louis and Orange County, California, have climbed on the bandwagon to create what’s being termed these days as workforce housing. That term, which helps people understand that it’s a whole different level of Monopoly from the issue of homelessness, is used to talk about the housing problems of people who are in the middle-income range. In some cases, it’s particular groups of workers – nurses, police officers, teachers and the like – who are targeted for help. In others it’s any middle-income household. What does affordable housing for middle-income people really mean? It’s both very mathematical (for those who study it) and pretty simple (for those who live it). The mathematically inclined housing wonks define affordability by looking at the median household income for an area: in the Lower Mainland, the median income is $55,000. Experts will tell you that there are two levels of housing problems linked to that number. People who make less than 80 per cent of that $55,000 are typically too poor to buy in any market. They need to find places they can rent that cost no more than about 30 per cent of their gross income. That means rents from $500 for those coffee-shop clerks making $10 an hour, up to $1,125 a month for the police officers just out of training school making about $45,000 a year. In the next layer up, the people who make 80 to 120 per cent of the median should be starting to buy their first homes, so there needs to be something available in their range. That means they should be spending $1,100 to $1,650 on their mortgage, property tax and house insurance combined, which pretty much caps that group at paying no more than about $235,000 for a place to live. (That assumes a 10 per cent down payment of $23,500 with a mortgage on the rest.) In the Lower Mainland, that doesn’t get you much – unless you’re willing to move to Maple Ridge or cram into a postage stamp in the bad part of Mount Pleasant. A few people will even say that Vancouver’s housing problem is so severe that the affordability squeeze extends up to households with 200 per cent of the median income. Even though $110,000 a year seems like a lot, it’s not that much when a fixer-upper crack house on Vancouver’s east side starts at $500,000 and the average single-family house price in Vancouver now hovers around $765,000.

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It used to be that it was mainly those living in Vancouver proper who fretted about affordability – and historically the problem was solved by moving to the cheaper suburbs or other cities in the province. But then the affordability crisis spread, with Whistler next to feel the pinch. As it developed into the province’s first resort town, Whistler found itself, as other resorts around North America had, struggling with the question of housing its service workers and ensuring that regular people who live there year-round have a place to call home. In 1997 the municipality created the Whistler Housing Authority to focus on building projects that fill the two consistent gaps in affordable housing. There are now 4,400 units in its portfolio, with about half being low-cost rentals (kept low because they’re built on municipal land) and the other half a pool of units for those who want to buy. As in Verdant, buyers get to buy at below-market cost, but only get part of the real estate profit when they leave. These days there are any number of suburbs and cities and towns around the province – from Tofino to Revelstoke, from White Rock to Whistler – where real estate prices seem to have divorced themselves from what average sales clerks, nurses, office managers and even university professors can afford. Vancouver still has the biggest gap, but it’s not alone. And it’s not just anecdotal. “By all the standard measures, there is housing stress,” says the City of Vancouver’s veteran housing centre director, Cameron Gray. He acknowledges that “some of it may be psychological because expectations are being compromised.” But there is a fundamental reality to Vancouver, he says: “You can’t build it as fast as people move here. What we’re seeing out there is real pressure on the lower end of the stock.” The current down-blip in the market isn’t expected to solve the problem, especially on the lower end. Prices may drop a bit, but they never go down significantly. “We keep going from one plateau to a higher plateau,” says housing consultant Dale McClanaghan, who has been working with Metro Vancouver. “We hit an affordability crunch and it settles, but it never goes back to the same level.” Instead, people have been trying to keep a lid on housing costs by moving farther and farther out or choosing smaller and smaller places – sometimes both. But there’s a finite limit to how far people can commute to their jobs or how small a place they can live in before something gives. [pagebreak] Businesses and public institutions worry about being able to attract and hang on to employees, while politicians and planners worry about the social fallout for cities that seem to be edging toward a dystopian future dominated by pricey condos, vacation pads and McMansions interspersed with the occasional block of social housing for the poorest and sickest. “To have a vibrant city, you have to make it affordable for all income levels, all ages,” says Malcolm Brodie, mayor of Richmond, the suburb once seen as one solution for those who couldn’t afford the big city. The benchmark price for a single-family Richmond house in June was $777,000 – higher than the price for east Vancouver. “If you’re catering only to the rich, even in the short run that will bring you challenges.” And as the more forthright developers will tell you, there aren’t enough rich people to buy everything they can build. “God made a lot more poor people,” says condo marketer Bob Rennie, explaining why he has been beating the drum for the last year about the need to find new strategies for affordable housing. “If we can’t take care of the first-time buyer, it’s over.” A host of people are trying to invent solutions to both preserve the low-cost housing that currently exists and find ways to create more. In Kelowna, for instance, a group of employers – including the city, university, college, health board and an airline-related company – is considering buying an apartment building together so that they can offer people they’re trying to hire a reasonably priced place to rent when they first come to the city. In Richmond the local council got religion after a developer evicted a building full of seniors (always a public-relations mistake) three years ago – deciding last year to unanimously support one of the region’s toughest housing policies. Developers tearing down old buildings have to build one new rental unit for every one they demolish, while those with new projects are now required to either contribute to an affordable-housing fund or build a certain number of units that are guaranteed affordable. There are now 300 units in the works. At UBC, meanwhile, the university, like Whistler, has a two-pronged approach. It is aggressively working to build its own rental supply. Recently, it reached an arrangement with Bastion Development Corp. to get apartments built by cutting the price of a chunk of land as well as making the apartments part of a larger deal involving the usual market-priced condos. In 2003 it started its own affordable-home-ownership program, using a different mechanism, called co-development, to help reduce the cost of units by 10 to 20 per cent for faculty and staff. Vancouver planners, who have been pioneering new ideas since the last housing crisis 20 years ago, have tried or are trying a whole range of tactics. The city is currently building its own market-rental apartment building above the new community centre at Main and Kingsway to help fill the biggest hole in the housing market – the near death of apartment construction since the federal government ended a tax-incentive program in 1975. Gray says the city is also contemplating redefining its requirement for 20 per cent affordable housing in megaprojects to include rentals and first-time home-ownership programs – something that could affect two large projects on the horizon: ParkLane’s 10,000-unit East Fraserlands and, ironically, the Little Mountain site, which the province is planning to tear down and redevelop into a much denser mix of private and social housing. At Little Mountain, the man who is building Woodward’s pitched BC Housing with a novel concept. Ian Gillespie, looking at what such cities as Singapore and Hong Kong have done, offered to build a certain percentage of units that would be turned over to BC Housing to be managed in the same way as SFU’s Verdant complex. The units would be sold at below-market prices, and the buyers would have to agree to take a below-market selling price when they left, so that the units could be preserved as a stock of lower-cost housing. The province ultimately didn’t accept Gillespie’s proposal, but it’s a sign of the new thoughts fermenting on the issue. Indeed, some of the most energetic thinkers on the topic are developers and architects, with proposals that include building condos with the barest of finishes (which would allow people to get in and renovate up as they can afford it) and projects where developers voluntarily set aside some low-cost units for buyers in certain income classes or certain professions. But the main types of offers being made to cash-strapped politicians fall into two distinct categories. One is that developers could build affordable housing if the city were willing to sell its land to them at a bargain price. The other is that, were the city to give them increased density – in other words, allowing more square feet of building than what’s normally permitted by the existing zoning – they would build some units that the city or a housing corporation would manage. For politicians caught in the crossfire of competing community demands, both of those kinds of offers are attractive – and scary. In Kelowna, city planners just got a proposal from the Aquilini group for a 26-storey tower – far above the city’s current limits – that offered the city control over a certain number of the units for affordable housing. It hasn’t come to council yet, but Mayor Sharon Shepherd says those kinds of offers can be fraught as the city makes deals with developers that require trade-offs. “The community looks at us and asks, ‘Are you being bought off? Is what you’re getting in return worth it? How are you changing the city?’ ” Giving developers discounted land is not without political peril either. During the last cycle of housing panic in the late ’80s, as the post-Expo city boomed, old ladies found themselves being turfed out of their apartments in Kerrisdale so developers could replace them with luxury towers. Then-Vancouver mayor Gordon Campbell scrambled to show the city was dealing with the crisis. He created a housing department at the city; he talked about creating new $1,000-a-unit demolition fees; and he tried a radical new idea to create affordable housing: leasing city land to a new company, headed by developer Jack Poole and B.C. Federation of Labour president Ken Georgetti, that would use union pension funds to build new low-rent apartment buildings. That project ended up generating controversy for years as the new company, Vancouver Land Corp. (now Concert Properties Ltd.), was criticized for failing to build the 2,000 units a year originally promised, or anything even close to it, and failing to rent out what it did build for even average, let alone below-average, rents. [pagebreak] The top contenders for next month’s Vancouver mayoral election, while astutely sidestepping any commitments to details, seem willing to consider some of the new ideas being pitched. “If there’s public support, we can run with it,” says Vision Vancouver hopeful Gregor Robertson, who has been campaigning on the mantra that he will foster an affordable-housing boom. “But there has to be rigorous scrutiny of what’s being put on the table and how public assets are being used to achieve a public good. This cannot be command-and-control, selling off city land for a fraction of the value or giving density freely.” The Non-Partisan Association’s Peter Ladner expressed more signs of interest in the proposal that the city discount land. He’s also a proponent of pushing for a tax system that encourages rental-apartment development, even though people have been lobbying for that ever since the previous tax program was killed off in the ’70s. He’s less enthusiastic about trading housing for density, making the argument that’s being heard more and more frequently these days: the more you use density for housing, the less you can use it to pay for everything else the city needs, like parks, daycare centres, or cultural spaces. Whoever wins, Vancouver is undoubtedly going to become the testing ground for new ideas. Once city politicians and developers work out the technical solutions, though, the next big gorilla they’re going to have to grapple with is, how does it work and who gets it? Because workforce housing is not about getting people off the streets, but providing more supply at the lower end of middle, it has a built-in challenge. “The perception often is with some of these programs that someone just won the lottery,” acknowledges Lorraine Copas, Metro Vancouver’s senior planner on the housing file. That’s especially true with first-time home-ownership programs – such as Verdant’s, Whistler’s, UBC’s, or the environmentally cutting-edge Dockside Green in Victoria, which will also offer some units using a similar model to Verdant – because they offer people a crack at a significant and long-term financial benefit that is quite different from the chance to have a cheap apartment rental for a while. At UBC the co-development ownership program is criticized by some housing experts because it reduces the cost for the first buyers, but none of that benefit is passed on. Homeowners get to keep all the profit when they sell if they stay more than five years. So those buyers get too much. In Whistler the housing authority has been challenged by buyers in recent years because their system says that homeowners can only get a profit based on the cost-of-living increase – typically much lower than real-estate appreciation. So those residents believe they’re getting too little. They’re also less likely to move because they fall further behind in the market every year they stay, so the pool of affordable housing gets stagnant. Verdant seems to have achieved a better proportion of profit-sharing between the community trust and the buyers. But as at Whistler, its buyers don’t seem to want to go anywhere. You don’t have to tell people at the Verdant complex about the lottery-winner syndrome. They know it. Paulo Horta says that when the Verdant townhouses at SFU were first offered to faculty and staff, not a lot of faculty members were interested in them. They thought that if the price was 20 per cent lower, then probably the quality was 20 per cent lower too. They didn’t quite get the way the deal worked or the mechanism of having the community trust set the buying and selling prices. So staff, who were lower paid and more tied to five-day-a-week jobs on campus, snapped them up. Horta and Roth were among the few faculty who took advantage of the offer. But once people saw the reality – in-floor radiant heating, environmental building techniques that reduce the power bills to almost nothing and all the other touches – Verdant suddenly became a hot commodity. They also got to see how the real-estate market would work in this kind of experimental project. One of the original buyers sold his unit recently after being there less than a year. In keeping with the rules of the complex, the university’s housing trust set the selling price of that unit by comparing it to a nearby private-market unit on sale and then deducting 20 per cent from that price. But the seller still made $35,000. That has provided even more of an incentive for people to want in, but now there’s no room – and there’s a waiting list of almost two-dozen households for any other units that come on the market. UniverCity president Gordon Harris is hoping that the Verdant model will spread, in this era of the hunt for affordable-housing solutions. “It’s an entirely replicable model,” says Harris. “We’re doing this in the hope that other developers and jurisdictions will mimic it.” A lot of people would like Harris to be right because what everyone says the region needs is something that can be duplicated easily. “There are a lot of wonderful projects out there,” observes Rennie, “but they’re all boutique.” What Vancouver needs is an idea that will catch on as fast and as simply as another weird and previously untested housing experiment did 40 years ago – one that allowed thousands of people to buy their first homes in what was even then considered one of the most expensive places for housing in Canada. You might have heard of the experiment, which was brand new in 1968 when the first three developers tried it in the Lower Mainland. The idea was to allow people to buy their own individual apartments in a building. You know. Condos.