Non-profit housing providers, who have been asking for more funding to address the housing affordability crisis, can now tap into a $500-million fund that will help them purchase rental buildings slated for redevelopment and protect renters from eviction.
The Rental Protection Fund, announced Thursday morning by Premier David Eby and Housing Minister Ravi Kahlon, will prevent older buildings from being scooped up by large corporations, such as real estate investment trusts, which often evict tenants to either renovate and charge higher rents or redevelop into luxury condominiums.
The fund, a key plank of his leadership campaign platform, will provide one-time capital grants to non-profit housing organizations to buy rental buildings listed for sale.
During a news conference outside a co-operative housing development managed by 115 Place Housing in Burnaby, Eby slammed the “predatory model” used by large international corporations that buy rental buildings as an investment vehicle, which “leads to evictions and rent hikes and can lead to homelessness.”
Many renters across Metro Vancouver have raised concerns about being evicted when an older rental building is snapped up by a property developer.
Canada Mortgage and Housing Corporation data shows that between 1991 and 2021, approximately 97,000 purpose-built rental units in B.C. were either redeveloped or converted to more expensive units.
Jill Atkey, CEO of the B.C. Non-Profit Housing Association, praised the new fund, saying in a statement “non-profits will be able to purchase existing rental homes and lock in their affordability forever, providing much-needed relief for existing residents and the generations that follow.”
Thom Armstrong, CEO of the Co-operative Housing Federation B.C., called the investment “ground breaking.”
“The powerful idea behind this initiative is that we can’t keep losing affordable homes more quickly than we build them,” he said. “This announcement is the shovel that’s going to allow us to start digging back up.”
Eby has not yet announced progress on another plank of his housing platform, which is to pass a law ensuring right of first refusal for non-profit housing societies looking to buy low-rise buildings up for sale, thereby preventing a bidding war with a private investor. Such a policy has been adopted by the City of Montreal.
Eby said such legislation won’t be ready for the upcoming legislative session but it’s still on his radar.
B.C. Housing figures show a record number of purpose-built rentals — 14,546 units — were built in 2022, compared to 9,272 units in 2017. However, a September study by the Office of the Federal Housing Advocate shows private equity firms, pension funds, and real estate investment trusts (REITs) are increasingly acquiring and developing housing as an investment strategy, which is linked to unaffordable rents and evictions.
The fund will be operational in the coming months and financed before the fiscal year end on March 31, which means it will be funded using the $5.7-billion budget surplus from the current fiscal year. The fund will be managed by an external entity called the Housing Protection Fund Society, made up of the B.C. Non-Profit Housing Association, Co-operative Housing Federation B.C. and the Aboriginal Housing Management Association.
Eby’s first major housing reform was the Strata Property Act, which prohibits stratas from restricting rentals or imposing 19-plus age restrictions that can force out young families when they have a child. The exception is that buildings can maintain “seniors only” or 55-plus rules, which Eby said will ensure seniors have enough housing options.
However, some strata corporations are taking advantage of a loophole in the new law prohibiting rental bans by converting to seniors only or 55-plus buildings.
