“Anyone else feel like they’re drowning here?” reads an anonymous post from a user on the Vancouver subreddit, an online community with over 452 thousand members. “[I have] a minimum wage job, getting renovicted AGAIN, [it’s my] 5th time having to move since 2016 and after this place there’s nothing else I can afford, I can barely afford to feed myself… I have to choose between eating or my mental health.”
Posts like this are a common sight in the community discussion, all posted by unique people experiencing similar difficulties and frustrations across Metro Vancouver: renovictions, financial struggle, rising housing costs, wages that are not keeping up, and uncertainty over the future.
This is a window into the personal suffering caused by a massive problem faced in BC and Canada’s rental housing systems: a major deterioration of affordable rent. According to BC Non-Profit Housing Association, between 2016 and 2021, BC saw an overall loss of almost 100,000 homes renting below $1000 per month. It is maybe no surprise then that BC leads the way in eviction rates across the country, 2021 study showing the province’s rates were almost double the national average [Figure 1].
There are many factors driving the decline in housing affordability in BC and across the world, and one dynamic that has recently received attention is the shift toward large institutional landlords owning significant proportions of the rental stock. Large institutional investors such as Real Estate Investment Trusts and private equity firms have been shown to be an important driver of declining housing affordability, through purchasing older rental buildings, renovating them, increasing rents and ultimately, evicting tenants. In BC, both large and small private landlords are allowed to set rent for vacant units at any level they see fit, which has resulted in astronomical rent increases.
The January 2023 Rental Market Report by the Canada Mortgage and Housing Corporation showed that rents for vacant units in Metro Vancouver jumped by about $800 between 2021 and 2022, from just over $1,600 to almost $2,400. Across the province, it is not uncommon to see $2,000/month rent for a one bedroom. All told, things feel very dire.
A $500 million acquisition fund to protect rental homes
Despite a sea of bad news about housing affordability, an important initiative has emerged in BC that provides a policy model for the rest of the country to help combat the financialization of housing.
On January, the province officially announced a $500 million rental housing acquisition fund that will enable non-profit and co-operative housing providers to purchase existing private rental buildings. The long-term goal of these housing acquisitions will be to stabilize rents in the acquired buildings, through removing the profit motive from their operation. Many large and small landlords have a structural incentive to continually raise rents, to maximize profit. Not-for-profit and cooperative ownership removes this incentive, and the new fund will help protect thousands of tenants from rapid rent increases.
While the details of the fund will be released over the coming months, it is important to note that it came to fruition as a direct result of sector mobilization. The Aboriginal Housing Management Association (AHMA), BC Non-Profit Housing Association (BCNPHA), the Co-operative Housing Federation of BC (CHF BC) spent several years advocating to government to get the fund set up. Moreover, buildings acquired through the fund will be owned by the non-profits or cooperatives who purchase them. This will add to the sector’s asset base, allowing housing providers to draw on their equity to develop additional affordable housing in the future.
Such acquisition funds can be replicated to other parts of Canada, and ought to be a major focus for affordable housing advocacy by other organizations across the country. The federal government and other provincial and territorial governments could work towards empowering the community housing sector to face the erosion of our affordable housing stock.
We look forward to learning and sharing more about the implementation and the development of the acquisition fund, its legal structure and modalities of operation, in the upcoming months.
Interested in initiatives mobilizing the sector towards solutions to the housing crisis?
Read about the pilot project Plancher, which ambition is to pool the billion-dollar assets of the sector to finance the development, acquisition and refurbishing of tens of thousands of community housing units.