Transit-Oriented Affordable Housing Study 2017-2019

Metro Vancouver and several study partners are working to better understand the opportunities and constraints for building new affordable rental housing in transit-oriented locations across the region.

There are two phases in this study. In 2017, the study partners examined the challenges and opportunities with building new affordable rental housing.  In 2018-2019, the partners are undertaking detailed research about the effectiveness and applicability of specific policies and financial tools.

• Transit-Oriented Affordable Housing Study Phase 2, expected completion 2019

  Metro Vancouver is leading the next phase of a regional collaborative effort to advance the knowledge base about the effectiveness and applicability of specific policy and financial tools to support the development of transit-oriented affordable rental housing. 

  The Phase 2 partners include the BC Non Profit Housing Association, BC Housing, TransLink, Vancity, Ministry of Municipal Affairs and Housing, Canada Mortgage and Housing Corporation, Urban Development Institute, and Metro Vancouver.  Phase 2 will be completed in early 2019.

  Business Case Framework for a Regional Revolving Loan Fund

  This component of Phase 2 will prepare a business case framework for a regional revolving loan fund and identify potential implementation pathways.  Some regions, such as Seattle, Denver, and San Francisco, are using regional revolving loan funds as part of their programs to support more transit-oriented affordable rental housing.  The funds have been designed to respond to the specific housing development needs in each jurisdiction, whether to support land acquisition, predevelopment costs, or construction costs.

  Implementation Guidance on Major Policy Tools

  This component of Phase 2 will prepare an implementation guidance report on four major policy tools which directly or indirectly reduce the cost of land with a view to encourage the creation of new affordable housing.  These policy tools include inclusionary housing policies, density bonusing, acquisition and deployment of land and airspace, and rental tenure zoning.  These four tools will be set within the full array of tools available to local governments today.  Different configurations may be possible to produce financially sustainable strategies to encourage the construction of more affordable rental units in the region.

• Transit-Oriented Affordable Housing Study Phase 1, 2017

  In 2017, Metro Vancouver and several partners completed a study to expand the region's understanding of the constraints and opportunities related to building new rental housing in transit-oriented locations across the region.

  The study partners include the BC Non Profit Housing Association, BC Housing, TransLink, Vancity, and Metro Vancouver. Though not a study partner, the Real Estate Foundation of BC provided a grant to support a portion of the study.

  Key Findings

  • Demand for rental housing, particularly housing affordable* to households earning less than $50,000 per year, is not being met across the region.
  • Renter households, especially those with lower incomes, are more likely to use transit. Increased ridership means a higher return on investment in transportation. Access to frequent transit reduces transportation costs and improves access to services and employment.
  • The primary reason new affordable housing is undersupplied is because the rents generated do not cover the costs of development (land and construction). The challenges are amplified in transit-oriented locations, where higher density expectations increase land costs.
  • There are innovative ways to approach land and construction costs, but even with these it remains very challenging to make new affordable rental housing financially viable.
  • Initiatives in other jurisdictions may be worth exploring in the Metro Vancouver region to generate new affordable rental housing near frequent transit.

  * Generally, 'affordable housing' is defined as housing that costs less than 30% of a household's pre-tax income.  For households earning less than $50,000 (lower income), the equivalent monthly rent is $1,300.  Since the completion of Phase 1, the income cut-off for lower income households has been updated to $60,000 using the latest 2016 Census information.  The equivalent monthly rent is $1,500.

  Study Activity Reports

  Activity 1 – Review current and innovative practices used in North America (Canada and the U.S.A.) that encourage new affordable rental housing near transit. The report also projects a regional rental housing supply gap.

  Activity 2 – Investigate whether rental or ownership tenure, and income level, relate to transit ridership.

  Activity 3 – Develop an inventory of lands under public or non-profit ownership in transit-oriented locations. This activity is in progress, with completion expected in 2019.

  Activity 4 - Explore the financial challenges to developing rental housing, and specifically affordable rental housing, in transit-oriented locations, and identify financial and policy tools available to narrow the affordability gap.

The Transit-Oriented Affordable Housing Study builds on two regional initiatives by Metro Vancouver - the Regional Affordable Housing Strategy and the Housing and Transportation Cost Burden Study - which describe the region's rental housing needs and the high household burden many renters face when housing and transportation costs are considered together.  For these studies, affordable housing is defined as housing that costs less than 30% of a household's pre-tax income.  For lower income households (earning less than $60,000), the equivalent monthly rent is $1,500.