Non-market housing 'renaissance'? Ownership options growing in B.C.

Home ownership is out of reach for many British Columbians in the face of ever-rising prices, but non-traditional options are becoming an increasingly attractive prospect – despite the caveats.

From co-ops, to unconventional mortgages, to not-for-profit ownership, are all seeing soaring demand for various reasons, with pros and cons to each option.

The Whistler Housing Authority has the most unusual model, and one that’s gathered considerable interest around the province and beyond. Those working full-time in Whistler can apply to rent or own housing units ranging from one-bedroom to family-sized, provided they don’t own any other residential properties.

“A two-bedroom rental unit would be approximately $1,800 a month, or around $450,000 to purchase within the affordable home ownership inventory,” said WHA general manager, Marla Zucht, noting the wait list is three to four years.

She said while the resort community is still struggling to provide housing for its staff, about half the 14,000 full-time residents who work there are now renters or owners in the affordable accommodation, which they see as a “nest rather than a nest egg.”

“The resale prices are restricted in price in perpetuity so that they do remain affordable for future generations of employs,” said Zucht. “The resale prices are tied to the consumer price index, essentially increasing at the same rate as inflation.”

CO-OP 'RENAISSANCE' ON THE HORIZON?

Co-op housing continues to be a pipe dream for many people looking for an affordable home, without many of the stressors of home ownership. The federal government stopped building co-ops in the early 1990s and wait lists have only grown for what is now an aging supply.

Low- and middle-income residents buy shares in the co-op but don’t have any equity or ownership stake in the property. However, they get to vote on policies like pets and parking priority, much like a strata, and can’t be evicted by owners looking to sell.

“You are, in a sense, both the landlord and the tenant since it's a co-ownership arrangement and it's operated on a democratic basis,” explained Thom Armstrong, CEO of the Co-Op Housing Federation of B.C. 

He says some co-ops have closed their waiting lists with applicants waiting up to 10 years for coveted spots where they would pay about two-thirds of the prevailing market rate in the not-for-profit system. That may change, with hundreds of units coming online after multi-million dollar commitments by the New Democrat government, and even more likely on the horizon. 

“The province has been making historic investment in affordable housing beginning in 2017-18 but ramping up in this most recent provincial budget to put even more resources on the supply side and the affordability side,” said Armstrong. “We're very hopeful this could be a renaissance for housing co-ops.”

UNCONVENTIONAL MORTGAGES GROWING

For some, the stability of home ownership and long-term investment benefits remains the goal, and a small but growing number of people are looking to team up to buy.

Co-ownership with friends or family members splitting the down payment and costs has increased in popularity at VanCity credit union in recent years, particularly among family members.

“It is less risky for the older generation to be able to get into the investment space with somebody that they trust living there,” said mortgage specialist, Lindsay Algra.

But this option also comes with drawbacks: getting into business with family or friends can be complicated, and VanCity recommends getting legal advice and being clear about agreements before anyone signs anything.

“They need to understand what their split is going to look like, so that could be 60-40, that could be 70-30,” said Algra. “Then they need to have strong conversations around what their life plans, what that looks like in five years, and what that looks like if one of them wants to exit.”