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Putting a price on affordable housing

Since housing prices have been climbing in the area, affordable housing is a term that gets tossed around a lot.But what is affordable housing?This was the question posed last week by David Stalker who noted people keep saying there should be affordable housing in the area, but no one can pin down a price.Mayor Rob Hutchins said the Town of Ladysmith has not put a dollar price on affordable housing in the area, but pointed out some steps the town is taking to try and make affordable accommodation.“We haven’t defined it yet in terms of a number.”Factors such as size and income of the community can help put a dollar amount on it.Hutchins said the city of Langford has put a price of $150,000 on affordable housing.House and lot prices nearly doubling since 2003 has pushed up any definition of affordable.“We have moved out, for a lot of people, of the affordable range.”One of the steps, said Hutchins, was helping move the Ivy Green Mobile Home Park to the end of Fourth Avenue. “To make sure we don’t lose that affordable housing stock,” said Hutchins, adding the two other modular home parks also provide some affordable housing.“The second one is the whole issue of secondary suites,” said Hutchins.“We are looking into the community review of legalizing secondary suites.”Having, and legally allowing, secondary suites can also foster affordable housing, said Hutchins, while making the primary home more affordable.Dennis Lait, with the Ladysmith Resources Centre, said an affordable house is a relative term that depends on a person’s income and debt levels.“A $300,000 home compared to Vancouver is an affordable house, but a $300,000 home in Ladysmith is not so affordable.”Lait said he would like to see a study done to try and figure out a price point for what is deemed affordable.Lorne Gait, realtor with Coast Realty, said affordable housing is an umbrella term encompassing the needs of several groups: Low-income earners, first-time homebuyers and seniors looking to downsize.Gait points to two ways to make housing more affordable through density.Building farther back into the bush won’t work, said Gait. He would like to see some of the houses in the northend of downtown turned into three- to four- storey apartment-style housing.“The airspace is worth something,” said Gait.“We want densification, because it’s better on the environment,” said Gait.Building up also makes sense for the town when it comes to adding services, said Gait.“It makes a whole lot more sense to have 10 people living where one person lives. That way we don’t need nine other places.”Building in the core would also help revitalize downtown as shops are in walking distance.“They’re going to shop right there.”“And you’ll also have places for 20-somethings or 30-somethings ... to live.”Another solution Gait sees is to build on smaller lots. Gait pointed to Langford where they are selling for smaller lots (2,500 sq-ft. to 3,000 sq.ft.) for around $300,000 and thinks they can produce the same housing here that would sell for $250,000.Gait said the current interest rates get people more buying power, but if interest rates jump, that affordable house becomes less affordable.Gait said we should be aiming to be in a position where we have less debt and a good place to live.Gait would like to see more houses under the $300,000 mark.“That means smaller lots.”Tara Hawes, manager of financial services, said Canadian Mortgage and Housing Corporation rules are making it harder for people to apply for those first mortgages.Hawes too pointed out what is considered affordable is dependant in individuals and their circumstances.“Again it depends on people’s circumstance,” said Hawes, pointing to day care as a huge cost for people.“Housing prices are growing exponentially to what salaries are,” noted Hawes.Hawes said when someone comes in looking for a mortgage, their approach is ‘what can we get you qualified for on a mortgage.’Hawes said the CMHC allows, at a maximum, 44 per cent of a person’s income before tax to go to debt, including car payments and credit cards. “For anyone trying to live that way, it’s really tight,” said Hawes.CMHC and the Bank of Canada have taken steps to get into that new home harder, out of fear we are creating the artificial housing bubble like the one that was experienced in the U.S.Disappearing are the days of 40-year amortization, as of March 16 they will be a maximum of 30 and you can’t do a line of credit anymore, said Hawes.“You can’t buy a house on one income anymore,” said Hawes.What do you think is affordable housing in the area? $200,000 $300,000?E-mail or comment at our website,

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