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nice touch!
City makes new proposal for low-income housing
Darren Bernhardt, TheStarPhoenix.com
Published: Monday, May 26, 2008
Skyrocketing real estate prices may prompt the City of Saskatoon to jump into the housing market and take on the role of a landlord.
The plan proposes the creation of a not-for-profit corporation to provide entry-level housing to people whose incomes have left them priced out of the market.
"Moving into the realm of direct delivery is a significant change in the city's traditional role in housing," states a report going to the executive committee on Monday. "Up to this point in time, the city has played an indirect role in the provision of housing."
Typically, the city assists community groups who provide affordable housing or offers development incentives to encourage affordable housing. But in the past 12 to 18 months, the average house price has gone from $160,000 to $250,000, meaning the annual household income required to finance such a purchase has surged from $48,000 to $70,000. Recent statistics show many households must now dedicate 40 per cent of their pre-tax income towards shelter costs, up from the 30 per cent guideline used by financial institutions.
However, only those families with income below $52,000 (or $44,800 for individuals) qualify for provincial programs aimed at helping them secure home ownership or rental housing. The program is delivered through faith-based and non-profit community organizations. The city plays a support role by covering 10 per cent of the capital cost for any new construction or renovations of dwelling units that support those who qualify for the programs.
Those folks above the $52,000 income mark "are left without any support," states the report to executive committee, written by Paul Gauthier, general manager of the community services department.
"It is all too easy for households spending greater than 30 per cent of their pre-tax income on shelter costs to slide the wrong way on the housing continuum," Gauthier wrote.
Events such as job loss, illness, severe accident or addictions can reduce a household income to a point where individuals or families, trying to hold on to their home, become dependent on a social assistance program.
"Given these circumstances, your administration believes the city should take a leadership role in introducing a housing program that will provide a foothold for these individuals and families to build equity and a financial base, which in turn, will allow them to enter the marketplace on their own terms at some point in the future," Gauthier wrote.
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