September 1, 2017
The City of Vancouver, in the context of its “Housing Reset” initiative, has set a goal of 20 per cent affordable housing for new construction. This is a laudable goal, but it makes you wonder about the other 80 per cent. Is our collective ambition to have a city where only one out of five of us can afford to live? And who are those other 80 per cent anyway?
Let’s take a step back in history. In both Canada and the United States the “20 per cent affordable” target has come out of a somewhat wonkish process. First you assume that the market can supply housing to 80 per cent of the employed and able bodied. That leaves 20 per cent that the market can’t reach and thus need a helping hand from the state.
That strategy has worked OK in most metropolitan areas. In most metro areas in the U.S. and Canada there was a firm relationship between the average family income in the region and the average cost of housing.
But we all know that here in Vancouver that is no longer true. Our average cost of housing is about three to four times higher than it should be if you use average family income as your measuring stick.
So while a housing strategy that targets 20 per cent affordable housing might make sense in Tulsa, Oklahoma, it is clearly not calibrated to the enormity of the task at hand here in Vancouver, where the majority of working residents need affordable housing, not just 20 per cent.