Langford is paring back its celebrated affordable housing program in the wake of rapidly rising property values.
Since its inception in 2004, property developers have allocated and subsidized one out of every 10 new homes, under certain conditions, for the affordable housing program. This week, Langford council changed that policy to one in 15 homes.
Recognized nationally in 2008, the program allows lower income Langford families to purchase new homes at well below market prices.
“(Changing the policy) is a response to increased costs of land and construction and market conditions,” said Denise Blackwell, chair of the planning, zoning and affordable housing committee. “We want the policy to be flexible. The developers are paying for it.”
The price of Langford affordable single familiy homes has crept up over the years, starting from $150,000 at the start of the program to $173,000 now, but the market value of three-bedroom dwellings has shot up faster.
Developers were initially asked to sell affordable homes at about $50,000 below market price, but now that gap is well into the hundreds of thousands.
“When we first did this, houses values were $210,000. Now they’re worth $400,000,” said Langford Mayor Stew Young. “The spread got too big. The value went up almost 100 per cent.”
Bringing the affordable housing price to within 50 or 60 per cent of the market value would price too many people out of the program.
Reducing the policy to one in every 15 homes keeps the program manageable for developers, Young said, and allows affordable house prices to stay well below market value.
“It’s not a perfect science, but it should allow us to keep a price point so a family can afford to buy a home who are making $15 or $17 per hour,” Young said. “If we put (the affordable housing price) up to $300,000, that prices a lot of people out of the market.
“I think this is a good compromise. I don’t want to eliminate the policy.”
In the past eight years, Langford has secured 90 affordable housing units, including 70 single family homes, 12 townhomes and eight condos. Forty houses and eight condos have been sold to Langford residents.
The number of houses developers are obliged to donate is calculated on the increase in density achieved through rezoning. If a developer is allowed 10 extra units beyond the original zoning, they would give one affordable home. Now 15 extra housing units will net an affordable home.
Kettle Creek Station developer Les Bjola said he supports the program, but is still working out if the one-in-15 policy closes the gap closer to a $50,000 developer donation per affordable house.
“This reflects the economic conditions we’re going through,” Bjola said. “When they created the affordable housing program, it was supposed to cost developers about $50,000 per house. Now its more like $150,000 to $200,000.”
Bjola said developers have told council about the price gap for a number of years, but council was presented with hard data in December.
“I think council felt it’s a good first step and realized its become inequitable,” he said. “Overall, I don’t think we’ve seen the last on the discussion about this.”
editor@goldstreamgazette.com