Proposed
Affordable and Attainable Housing Strategy
Prepared for the City of Fernie
October 2007
Foreword
CitySpaces Consulting appreciates the advice, perspective and assistance
provided by individuals, stakeholder groups and government agencies
during the research and consultation components of the Fernie housing
study. In particular, we acknowledge the supportive involvement of our
client Steering Committee:
> Bruce Lennox, Chair and Director of Planning
> Allan Chabot, Chief Administrative Officer
> Jim Hendricks, Director of Financial and Computer Services
> Duane Janzen, Building Inspector
> Darrell Beck, Engineering Technologist
We also appreciate the support provided by Sheryl Zral in organizing the
community consultations and the assistance of Councillor Alan Young in
accessing Fernie and area real estate data.
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Table of Contents
Foreword
1.0
2.0
3.0
4.0
Introduction.................................................................................. 1
1.1.
Scoping Study — Summary.................................................................1
1.2
Needs Assessment — Summary............................................................1
What can the City of Fernie do?.......................................................... 3
2.1
The Legislative Context....................................................................3
2.2
Beyond the Legislation.....................................................................5
Proposed values, goals, roles............................................................. 7
3.1
Four Foundational Values..................................................................7
3.2
Four Goals....................................................................................7
3.3
Five Key Roles for the City of Fernie.....................................................7
City Roles and Proposed Actions.......................................................... 8
4.1
Role #1 — Setting Policy....................................................................8
4.2
Role #2 — Establishing Regulations.......................................................9
4.3
Role #3 — Using City Resources......................................................... 13
4.4
Role #4 — Entering into Partnerships................................................... 14
4.5
Role #5 — Advocacy and Capacity Building............................................ 16
5.0
Priority Setting.............................................................................17
6.0
Administrative Considerations...........................................................19
7.0
Closing Comments.........................................................................19
Appendices
Appendix A – Scoping Study
Appendix B – Needs Assessment
Appendix C – Affordable Home Ownership Examples
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Proposed AFFORDABLE & ATTAINABLE HOUSINg Strategy
1.0
Introduction
This report outlines a housing strategy to be coordinated by the City of Fernie, with the support
of Fernie’s businesses and non-profit organizations. Two earlier phases of the consultant’s work
described housing challenges for Fernie residents and assessed specific housing needs. These were
documented as reports, reviewed by Council and shared with the broader community on the City’s
website. They form appendices A and B to this report.
Housing terminology varies considerably and, even among housing analysts, there are no absolutely
common definitions. Throughout this strategy, the terms “affordable” and “attainable” are used,
often synonymously. Generally, the terms refer to housing that could be rented or purchased
by a household without spending 30% or more of their gross income on housing. The distinctions
between the two terms are much less important than actually taking steps to help Fernie residents
who have the greatest needs, and the least choice, in the housing market.
1.1. Scoping Study — Summary
Five main challenges were identified through the stakeholder interview and community
consultation process.
1. Home ownership is not attainable for many working people. As house prices rise, fewer young
households are able to purchase a home.
2. There are limited housing choices for renters. There is little available rental housing for low
income households, single parent families and people with disabilities.
3. Rental housing conditions are variable.
4. The lack of housing impacts employee recruitment and retention.
5. Housing issues lead to other social and community issues.
1.2
Tamara
Needs Assessment — Summary
Working from the outcomes of the Scoping Study, the consultant
collected and analyzed a range of data, and identified four groups
that have the greatest housing needs.
John
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Rhys and Savina
1. Low income individuals and families, as well as people
with disabilities on income assistance have the least choice
in the Fernie housing market. Many of these individuals and families live
in unstable and unsuitable housing circumstances; some are at risk of
becoming homeless. Fictional characters Rhys and Savina, John, and
Tamara with her two children are illustrative of Fernie residents with low
incomes. Tamara is a single parent; John is disabled; and Rhys and Savina
are hospitality workers. There is currently an unmet need of between 30
and 40 rental units of affordable, suitable housing for this group. This
should be the top priority.
Page Phyllis
• Almost 60% of single people, and more than 40% of lone parent families, make less than
$25,000 annually. A single person with a disability receives $906 per month. A one-bedroom
costs about $500 to rent. In New Horizon Village there is little turn-over
and a long wait list.
4. Seasonal workers need wider and better choice in the market. As the
labour force ages it is likely to be increasingly important for employers
to know that their recruits have suitable affordable housing. Amber
and Gareth are two fictional people who represent this group of Fernie
residents. They are a vital part of the valley’s economy, providing a
range of services in the hospitality, recreational and retail industries
• Most entry level hospitality, tourism and retail jobs pay $8 to
$10 per hour. On this income housing choices are very limited. In the
future, it will be more difficult to attract young workers and college
students without appropriate housing.
Evelyne
Amber
3. Prospective first-time homebuyers with one or more
children with $60,000 or less annual income have very little
opportunity to purchase in Fernie. Evelyne, and Sally and
Mike are fictional people who represent twenty-something
Fernie residents that are interested in making a long-term
commitment to Fernie, IF they are able to purchase a home.
Evelyne works as a hospital nurse, and Sally is a stay-at-home
mom while Mike is a banker.
• Young families find it increasingly difficult to purchase a home and
some move away to more affordable locations. The median sale price for a
detached home in Fernie in mid-2007 was $350,000; a condominium about
$215,000. The median income for a couple in 2005 was $76,700. With 10%
downpayment, they could afford a home purchase of about $260,000. Fifty
percent of households could afford less.
Frank and Etta
Sally and Mike
2. Active, mobile seniors with equity in their homes looking to move to
a smaller home/condo represent an opportunity worth exploring by
a private sector developer. Our “representational” seniors — Phyllis
and Frank and Etta — like many Fernie seniors we spoke with, would
like single-level living (e.g., condominium) near services, at a price
they consider “reasonable”.
• With respect to seniors who require some support in addition to
housing, additional units will be needed as the population ages. Planning for
another supportive/assisted living complex should begin within the next 3-5
years.
• The BC government’s projections indicate that people age 65 and older will account
for 13% of Fernie’s population by 2011 and 23% by 2021. If there isn’t enough suitable,
affordable housing, older residents have little choice but to leave Fernie for larger centres.
There are already waitlists at Trinity Lodge and Rocky Mountain Village.
Gareth
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Page 2.0What can the City of Fernie do?
During the consultant’s interviews and workshops, many
people expressed the view that the City of Fernie must
take a leadership role in addressing the community’s
housing needs. Some felt that the City has been slow to
take action on housing. A number of suggestions were put
forward for further consideration as to what actions the
City should take. These are identified in the accompanying
sidebar.
If the City does choose an ongoing activist role in the
area of affordable and attainable housing, this would be
almost an entirely new sphere of activity for the City.
Until recently, the City’s principal role in housing has been
limited. And, until relatively recently, other than Whistler
and communities in Metro Vancouver, most of BC’s local
governments have played no role, or a limited role, in
affordable and attainable housing.
2.1
The Legislative Context
In order to understand how the City of Fernie might move
forward on housing, it is useful to confirm the legislative
context for BC’s local governments. By doing this, it is
possible to identify both what Fernie is already doing, and
what more it can do with the available legislative tools.
Suggestions from Scoping Study
• Use City land for affordable housing
• Provide incentives to developers to create
affordable housing units
• Require developers to provide a percentage of
affordable housing within their developments
• Increase developer charges
• Annex land in West Fernie, Hosmer
• Encourage small-lot subdivisions and modular
homes
• Create a housing authority to build and manage
housing, governed by a community board
• Work with the Regional District to achieve policy/
regulatory consistency
• Tax reductions for year-round residents; extra
taxes for second-home owners
• Negotiate for Provincial Crown land for
affordable housing
• Cap rents on non-market housing
• Secondary Suites Program
• Land Bank Program
• Manufactured homes demonstration
Traditionally, the federal government provided affordable
housing across Canada. However, in 1992, the federal government withdrew funding for any
new social and cooperative housing, effectively leaving provincial and municipal governments
to meet local needs. Since then, in British Columbia, BC Housing has played an increasingly
important role in affordable housing. Targetted funding has been directed towards people with
special needs, seniors and homeless people. In Fernie, New Horizon Village, Tom Uphill Manor,
and Chrysalis House have resulted from partnerships with BC Housing and Fernie Family Housing
Society. Concurrently, the provincial government made a number of legislative changes in order to
facilitate local government’s role in housing.
The City’s powers in relation to housing are derived from the Community Charter (Charter) and
the Local Government Act (LGA).
•
The Charter, brought into effect in January 2004, gives BC municipalities the authority to
legislate in relation to a number of broadly stated “spheres of jurisdiction”. Under the pre2004 LGA, the specific detail of a regulatory power was set out; if there was no mention of a
specific power, a local government had no authority to take action. In relation to housing, the
former LGA was limiting. In contrast, the Charter provides a municipality:
>
More flexibility to identify and provide any service that Council considers necessary or
desirable (Section 8.2), such as housing;
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Page >
>
Ability to waive / reduce fees and charges when land or
improvements are owned or held by a charitable, philanthropic
or other non-profit corporation (Section 224);
>
Ability to waive / reduce fees and charges for land or
improvements that are subject to an eligible “partnering
agreement” (Section 225); and
>
•
Clear authority to regulate in three ways: the power to regulate,
the power to prohibit and the power to impose requirements
(Section 8.7);
Authority to establish a tax exemption program for an area
designated as a “revitalization area”. The program can stipulate
the kinds of property eligible, the term of the exemption, and
other conditions (Section 226).
Why does Provincial legislation
matter? Can’t the City do
whatever it wants to?
The City is guided by laws
that apply equally to all BC
municipalities. In contrast to some
other provinces, BC does have
legislation that helps to promote
affordable, rental and special needs
housing.
And, the Community Charter
provides considerably leeway for
municipalities. If affordable housing
is seen to be an important City
“service”, there are a number of
ways that the City can actively
participate.
In addition to the Community Charter, the Local Government Act
contains a number of specific provisions related to housing:
>
Requires an Official Community Plan to include housing policies of the local
government respecting affordable housing, rental housing and special needs housing
(Section 877);
>
Provides flexibility to allow higher density (bonus zoning) in return for the provision of
community amenities, including affordable and special needs housing (Section 904);
>
Enables a local government to enter into a housing agreement with a land owner
regarding the occupancy of the housing units in terms of tenure, classes of person,
administration of the housing units, rents and lease, sale or share price. This housing
agreement is registered on title and is binding on future owners (Section 905);
>
Provides authority to impose development cost charges (DCCs) to raise funds to
assist in paying capital costs for employee housing related to the operation of resort
activities. Note: This applies only in “resort regions” and is a recent amendment to
the LGA (Section 919);
>
Provides authority to waive or reduce a DCC for not for profit rental housing, including
supportive living housing (Section 933); and
>
Allows for variation of DCCs according to different sizes or different numbers of lots or
units in a development (Section 934).
•
The Local Government Act also stipulates that the BC Building Code applies to all
municipalities. Part 9.36 of the Code applies to “Secondary Suites”. This was incorporated
following a comprehensive policy review and resulted in reduced requirements for things such
as ceiling heights, and fire safety provisions. The amended code, however, does not apply to
existing suites. To deal with this gap in the Code, some municipalities have opted to establish
their own framework of “equivalent requirements” for existing suites in the interests of
facilitating their legalization.
•
The Strata Property Act also comes into play in relation to rental housing. In order for an
owner to convert an existing rental building into strata lots, s/he requires approval of the
“approving authority”. In Fernie, this is City Council. In reviewing a proposed conversion, the
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Page Act specifically allows an approving authority to consider, among other things, “the priority of
rental accommodation over privately owned housing in the area.” If the approving authority
approves the conversion, s/he may impose conditions.
2.2
Beyond the Legislation
Outside of the provisions of the Community Charter and the Local Government Act, local
governments in BC have gradually become more active in housing. Together with health and
social service providers, local governments have the earliest warning and clearest understanding
of the community’s housing needs. And, they are a logical entity to facilitate multi-stakeholder
discussions. Larger BC municipalities have taken the step of assigning one or more staff to work
specifically on housing related matters. In most BC municipalities, however, limited resources
preclude doing this and, instead, they must make progress incrementally, juggling competing
community interests and Council priorities.
2.2.1 Partnerships
Partnerships have proven to be the best way to increase the supply of affordable housing. With
limited government funding and borrowing, there has been an interest in exploring other funding
sources, including the philanthropic sector and local government. In BC, community organizations
such as the Vancouver Foundation, the BC Real Estate Foundation and other charitable groups have
been a source of grants for some housing providers, primarily directed towards a specific purpose
rather than on an ongoing basis.
•
Typically, local governments provide either land or staff resources, or a combination of
both. A few local governments have a long history of land banking for affordable housing (e.g.
Saskatoon, Vancouver), but most local governments have few and scattered land holdings,
and these are not always well located for housing purposes. However, if land is a possible
contribution to a partnership, this is a significant contribution, whether in the form of a longterm lease at below-market rates, or as a discounted sale. Other forms of contribution to a
partnership are such items as reduced fees and charges, and fast-tracking approvals. Rarely do
local governments provide any cash contribution or become involved in mortgage financing.
•
Local governments in BC often become partners with BC Housing. For 40 years, this agency
has been instrumental in facilitating housing for assisted living for seniors, transitional housing
for people with disabilities, emergency shelters, and housing for low-income families. In 2007,
BC Housing is focussing on the “Homeless Initiative” (22 communities, 2,300 homes). However,
the agency remains open to approaches by existing non-profit housing providers, charities and
local organizations for housing that meet demonstrated community needs — the “Community
Partnership Initiative”. >
An unmet need for affordable housing for the most vulnerable people in the local
community.
>
A solution that will effectively alleviate that need and increase housing options.
>
Substantial financial contributions from others, such as the sponsoring group, other
levels of government, other non-profit societies and community organizations.
>
The proposed project is cost effective, sustainable, and provides good value for the
investment.
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Page •
•
There are a number of ways BC Housing may help with affordable housing development
through Community Partnership Initiatives, including:
>
Providing capital assistance (grants and forgivable loans)
>
Providing interim construction financing
>
Facilitating mortgage financing
>
Providing rental assistance
>
Providing development advice
BC Housing, at this time, does not have a specific program that targets homeownership.
However, other groups have been active on this front. In the last several years, there has been
a renewed interest in creating partnerships to assist people with minimal equity to become
home owners. Habitat for Humanity is probably the best known organization to focus on home
ownership. CMHC has relaxed its conditions regarding mortgage insurance and lenders have
become more creative by providing prospective home owners with more choice and flexibility
in the mortgage market. Amortization periods of 40 years have become acceptable among
conventional lenders, thereby reducing monthly cost for purchasers.
>
In recent years, there have been a number of projects where partners have come
together to create opportunities for homeownership for people of low to moderate
incomes. Appendix C provides examples of approaches being implemented in Canada
and the United States.
•
Private market developers are also potential partners, particularly in projects that involve
homeownership. Some developers specialize in providing housing that designed for families
and individuals with modest incomes and low or no downpayments. In Southern Alberta,
Classic Construction Limited is a firm well-known for its commitment to affordable housing.
•
Lending institutions can also be viewed as potential partners. Through innovative mortgage
products (e.g., laddered mortgages, springboard mortgages, second mortgages) individuals
and families that have good credit records but limited cash flow can ease their way into
homeownership. Local credit unions and bank branch offices are also a potential source of
advice; some offer homeownership literacy programs.
In the 1970s, the Federal Assisted Home Ownership Program (AHOP) helped to produce thousands of units across
Canada. In the early 1980s — a time of double digit interest rates — three temporary federal programs were introduced to
assist middle income households — Canadian Home Ownership Stimulation Program, Canada Mortgage Renewal Plan and the
Graduated Payment Mortgage Plan.
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Page 3.0
Proposed values, goals, roles
The proposed housing strategy is founded on four foundational values and four goals. The core
elements are discussed in the context of five City roles, and 29 actions. An implementation section concludes the strategy, separating the proposed actions into short and medium priorities.
3.1
Four Foundational Values
•
Fernie residents and prospective residents should be able to secure safe, appropriate
housing that is affordable for their income level.
•
Affordable, attainable housing is an essential community good. Within its jurisdiction, the
City of Fernie will work towards an inclusive community that provides housing opportunities
for people of all ages.
•
Senior governments must take the lead for providing housing that involves complex care or
significant intervention; the City of Fernie will assist as resources allow.
•
Homeownership is a generator of income security, and, as opportunities arise, the City of
Fernie will be receptive to helping low and moderate income households gain equity in
market housing.
3.2
Four Goals
•
To improve the choice and quality of housing for Fernie’s low and moderate
income residents.
•
To assist young people to purchase a home in Fernie.
•
To ensure there is appropriate housing for Fernie’s residents as they grow older.
•
To improve the choice and quality of housing for seasonal workers.
3.3
Five Key Roles for the City of Fernie
1. Setting Policy
— Clear, consistently applied policies express the City’s commitment to affordable /
attainable housing.
2. Establishing Regulations
— Effective use of regulatory authority creates housing choice and can facilitate attainable
homeownership for year-round Fernie residents and rental housing for seasonal and short
term workers.
3. Using Resources
— Strategic use of City resources (land, revenues) can leverage an increased supply of
affordable / attainable housing.
4. Entering into Partnerships
— Collaboration with the business and non-profit communities, and Provincial agencies, will
lead to creative solutions to existing and emerging housing issues.
5. Advocating and building capacity
— A commitment to ongoing leadership on housing.
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Page 4.0
City Roles and Proposed Actions
4.1
Role #1 — Setting Policy
Clear, consistently applied policies express the City of Fernie’s commitment to affordable /
attainable housing. When City officials meet with prospective developers, funders, partners or
senior government representatives, it is extremely helpful to have a clear policy framework.
The Official Community Plan (OCP) is the City’s primary policy document. The existing plan (2003)
contains a chapter on housing and has several objectives and policies that speak to housing from
a social policy perspective. The Plan provides a very good foundation for further City actions
related to affordable and attainable housing. Consequently, City staff have a sound basis to
require or negotiate for affordable, attainable housing when reviewing specific development
proposals. Equally, importantly, City staff can reference Council’s policies when facing resistance
to affordable housing during rezoning processes.
The OCP also anticipates having sufficient serviced (or serviceable) land for residential
development and redevelopment in order to accommodate future growth. While this approach
should ameliorate the escalation of land prices, it is nevertheless dependent on the timing and
intentions of private land owners.
While the OCP contains many progressive statements, two text amendments are suggested
that have the effect of strengthening the policy foundation for affordable/attainable housing,
particularly at the time of rezoning or subdivision:
Action
#1
Action
#2
Action
#3
Action
#4
•
Add a policy that speaks to the City’s intent to support people through the continuum of
housing, from subsidized housing through to home ownership; and
•
Add a policy that reflects that affordable / attainable housing is an essential component of
community life, and in terms of development contribution negotiations, on par with parks,
schools, roads and services.
In addition to the OCP amendments, it is recommended that the City and Regional District formally
approach the BC Government to designate Fernie and area as a “resort region” as provided for in
Bill 11, a 2007 amendment to local government statutes. This “resort region” would include the
Fernie Alpine Resort. From a housing perspective, there is one major advantage of establishing
a “resort region” — to be able to assess Development Cost Charges for the purpose of employee
housing. As evident from the Scoping Study and Needs Assessment, there is a demonstrable need
for employee housing. The details of how the Development Cost Charges would be assessed by the
City following the designation.
A fourth policy recommendation related to policy is to develop a Tenant Assistance Policy for the
redevelopment of a mobile home park. Mobile home parks have historically provided an affordable
housing alternative for many communities. In many growing communities around the province,
this land use form has come under considerable pressure for redevelopment. Although this topic
was not specifically raised during the Scoping Study, the consultant suggests that Fernie’s mobile
home parks (and potentially those in the Hosmer area) are likely to be candidates for potential
redevelopment to more dense forms of residential development.
•
In BC, the legislation requires the landowner to provide 12 months of notice to tenants prior
to ending tenancy and compensation equivalent to twelve months rent. Many communities
have established local policies to supplement these provisions and address issues of tenant
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Page displacement and loss of affordable housing. Typically, these cover tenant notification,
additional compensation, and an option to rent or purchase at discounted rates in the new
development.
4.2
Role #2 — Establishing Regulations
Effective use of regulatory authority creates housing choice and can facilitate attainable
homeownership for year-round residents and rental housing for seasonal workers.
Subdivision, zoning and building bylaws are important regulatory mechanisms. Sometimes, without
intention, these bylaws have provisions that make it very difficult and / or too costly to develop
and construct housing affordably. Periodically, bylaws need to be reviewed from the perspective
of housing affordability. This is especially true to facilitate the legalization of existing secondary
suites, encouraging more suite construction, and being receptive to new housing forms.
4.2.1 Removing Regulatory Barriers
•
Revise the City’s current approach to Development Cost Charges for residential development
to amend the method of charging from a per unit basis to a per square metre basis. This
would benefit developers of smaller sized units and, potentially, incentivize more innovative,
compact housing.
•
Proactively review City zoning, subdivision and building bylaws to ensure regulations and
standards are not a barrier to affordable housing development.
•
Reduce requirements in the R1 zone to permit small lots — 334 m2 (3,600 sf) minimum lot
size and 9.1 m (30 feet) minimum width. Examine other R1 zone regulations in order to
accommodate a single detached dwelling with a secondary suite on small lots.
Action
#8
•
Consider amending the zoning bylaw to permit manufactured homes in the R1 zone, subject to
resolution of design issues (e.g. foundation and roof pitch requirements).
Action
#9
•
Reduce the parking requirements for housing on small lots in Maintown and the Annex from
two to one spaces.
•
Encourage developer– or neighbourhood-initiated compact housing proposals (e.g., lot
splitting, backyard infill, freehold townhouses). Reduce application fees for rezoning for
innovative housing proposals.
Action
#5
Action
#6
Action
#7
Action
#10
4.2.2 Secondary Suites
Although there is no specific tally of secondary suites in Fernie, through the Scoping Study it was
evident that suites (compliant or not) provide a substantial amount of ground-oriented rental
housing in Fernie. Due to a lack of new construction of purpose-built rental buildings, secondary
suites will likely play an increasingly important role in Fernie’s housing market.
Following adoption of the 2003 OCP which includes several policy statements about secondary
suites, the City’s zoning bylaw was amended to permit a secondary suite within a single detached
dwelling in the R1 zone, subject to certain conditions and the BC Building Code. The zoning bylaw
was also amended to permit a secondary dwelling in a separate building on a lot with a single
detached dwelling, subject to a rezoning process (R1B). These amendments are very progressive
but, in the consultant’s experience, they may not result in as significant take-up as expected.
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Page Several recommendations are made to encourage the creation of new
secondary suites and encourage the legalization of existing suites:
Action
#11
Action
#12
Action
#13
Action
#14
Action
#15
•
•
R1 and R1B - Replace “compliance with BC Building Code” to
“alternative life safety standards” (i.e., code equivalencies) for
existing suites. Maintain “compliance with the BC Building Code” for
new build situations. Research and formalize “alternative life safety
standards”.
R1B – Reduce the minimum unit size requirements to be consistent
with R1. Waive or significantly reduce the application and
notification fees for rezoning. The requirement for rezoning is
onerous and expensive for an individual property owner and may be
disregarded.
Action
#17
• Improve the overall choice
and quality of housing in Fernie,
particularly for seasonal workers,
college students, and one-person
households;
• Encourage existing landlords
whose suites are not compliant to
disclose and upgrade;
• Make it easier for people to
beomce a landlord and have a
“mortgage helper”;
• Reduce the concern of tenants
living in non-compliant suites
(safety, potential displacement).
•
Reduce City service fees (e.g. sewer, water) for secondary suites to
40% of the primary unit. The current practice of charging 100% is a
significant disincentive for a landlord.
•
Encourage all new single detached homes to be “suite ready”. This makes future conversion
less costly and more convenient. The philosophy which underlies this approach is that the
house will have several owners during its lifetime and that the households who will occupy
this house will have different needs over time. Typically, where “suite ready” programs are in
place, at a minimum provisions would be made for:
•
>
independent heating systems (e.g. gas fireplace in the future suite area);
>
fire separation;
>
inter-connected smoke detection; and
>
separate exit to the exterior.
Undertake an active, well-resourced program ( to bring existing non-compliant suites into
compliance. This is a positive rather than a negative approach and avoids the displacement of
tenants and the loss of existing affordable rental stock. It also results in improved quality and
safety of the rental premises. (Note: this first requires the development of “alternative life
safety standards” as noted in Action #10).
>
Action
#16
The recommendations for
Secondary Suites will:
Note: The implementation of a proactive program will require the significant
commitment of City staff resources for public education, and assistance to landlords
and prospective landlords for the processing of applications, and additional
inspections. Some municipalities such as Kelowna and Saskatoon have set annual
targets for numbers of legal suites to be created rather than trying to deal with all
non-compliant situations at one time. Staff resources have been allocated with these
targets in mind. Both cities have annual targets of +/- 50 suites.
•
Set an amnesty period for homeowners with existing non-compliant suites to disclose
and upgrade. Further encourage their participation by reducing City fees for application,
inspection, and licensing.
•
Investigate the possibility of secondary suites in new-build townhouses and apartments. Where
these have been permitted they tend to be similar to a “lock-off” in a resort setting and are
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Page 10
often suitable for relatively short-term occupancies (e.g., students, seasonal workers). This
investigation will include parking implications and vacation rentals.
Action
#18
•
An application for decommissioning of secondary suites will be required. For secondary suites
that have been created within five years, a decommissioning charge will apply. For suites that
have been rented continuously for more than five years, there is no decommissioning charge.
4.2.3 Strata Conversion
The City currently has a moratorium on the approval of strata conversion of rental buildings. The
reason for this has been to prevent the loss of long-term rental accommodation. While this is a
legitimate concern as evidenced through the Scoping Study, it also significantly limits the owner’s
use of the property. In an era where almost no purpose-built rental is being built other than
secondary suites, it may be timely to reconsider the policy. The following recommendations are
made:
Action
#19
•
Consideration should be given to rescinding the existing blanket moratorium, but with
conditions. If an application for conversion is received, it will be reviewed on its own merits,
and subject to the conditions of the approving authority. Suggested conditions are:
>
For multi-unit buildings with five units or more, 25% of the units will remain as
rental for a period of 10 years – registered as a housing agreement on the land title;
alternatively, the applicant will pay a conversion fee of $25,000 per unit equivalent
to the number of units that would be required to be maintained as rental (e.g. A 20unit building would be required to maintain five units as rental for 10 years or pay
$125,000). The fees that are raised will be directed to the City’s Affordable Housing
Reserve Fund;
>
For multi-unit buildings with four or fewer units, 50% of the units will remain as
rental for a period of 10 years – registered as a housing agreement on the land title;
alternatively, the applicant will pay a conversion fee of $25,000 per unit equivalent
to the number of units that would be required to be maintained as rental (e.g. A
4-unit building would be required to maintain two units as rental for 10 years or pay
$50,000). The fees are raised will be directed to the City’s Affordable Housing Reserve
Fund;
>
Existing tenants will be given 6 months notice;
>
The applicant for conversion or decommissioning of a suite will file a statement
with the City as to what provisions will be made to existing tenants with respect to
assistance in relocation.
4.2.4 Fernie Attainable Housing Program
Action
#20
The consultant recommends that the City give priority consideration to establishing the Fernie
Attainable Housing Program (FAHP). The sole objective of such a program would be to create a
perpetual supply of below-market home ownership units that will be attainable by Fernie residents
with moderate incomes. The housing will be built by developers and will always resell at belowmarket prices.
Programs of this type have been successful at generating a significant number of below-market
homes in communities in Canada and the US. Local governments are the primary instigators of
these programs because they have the legal tools necessary for their implementation. Although a
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Page 11
“made in Fernie” program merits considerable further discussion
among City staff, the development community and interested
stakeholders, the consultant suggests that the main aspects of
any program would be:
Proposed ...
Fernie Attainable Housing Program
This program would result in a growing
supply of below-market homeownership
units for moderate income families.
It would be delivered by private sector
developers and administered by the City.
Developers would be offered incentives
and options to facilitate their participation.
•
The target group is eligible, pre-qualified families with one
or more school-aged children living at home whose annual
income is between 60 and 80% of the annual median income
(AMI). The AMI for Fernie households in 2005 was $76,000.
Consequently, families making between approximately
$46,000 and $61,000 would be the income group served.
•
For all new multi-unit residential and mixed-used developments that require a rezoning, a
portion of housing units will be sold at below-market prices to buyers on the “eligibility list”
maintained by the City. Once the units are sold, the developer
has no further involvement in the program.
Eligibility Considerations
•
The City would enter into a “housing agreement” with the
initial purchaser that, among other things, restricts the
maximum resale price. This agreement is registered on the
title of the property and applies to all future owners. Future
purchasers of the dwelling benefit from a discounted price.
Over time, the portfolio of below-market housing increases.
•
A developer is expected to build these below-market units
on-site. Many projects that require a rezoning will typically realize additional “land lift” that
would support a contribution of a proportion of units given certain assumptions and the offer
of additional density. Additional incentives may be negotiated. For example, reduced DCCs and
processing fees, reduced parking requirements, phased compliance, etc.
•
In consideration of special circumstances, potential alternatives to on-site construction that
may be considered are: off site construction; in-lieu fees paid into an Affordable Housing
Reserve Fund established by the City; or land dedicated to the City. The preference is for onsite construction.
•
The exact proportion (i.e., percentage) of units, and the equivalent in-lieu fee, would
be determined by the City, and varied with market conditions. For the purpose of further
investigation, the consultant suggest a 10-15% requirement (or equivalent in-lieu fee) for all
multi-unit and mixed-use projects.
•
The City will use the accumulated fees in the Affordable Housing Reserve Fund for additional
land purchase for future affordable housing or for capital projects of other non-market housing
providers.
•
The City would take on responsibility for the management and administration of the FAHP.
Typically, this involves managing the eligibility list, reviewing applications, fielding enquiries,
filing housing agreements, and negotiating with developers re: options and incentives. An
advisory community group might be an asset to the work of the City.
• Minimum age and citizenship
• Employment or residency requirement
• Maximum household income
• Maximum household assets
• Financial capability
• Occupancy
Cross-reference: Action 24 for description of the proposed Affordable Housing Reserve Fund.
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Page 12
•
If the City decides to establish the FAHP, additional work needs to be undertaken, including
the details of a housing agreement, financially supportable requirements, and in-lieu fee
equivalency.
4.3
Role #3 — Using City Resources
The strategic use of City resources (land, revenues) can leverage an
increased supply of affordable / attainable housing.
4.3.1 Resources – Land
The City owns a number of
properties that could be used
or leveraged for affordable or
attainable housing.
Action
#21
•
Use the City’s land holdings to help meet affordable and special housing
needs.
Action
#22
•
Continue to acquire land as opportunities become available. Bank this land for future use for
affordable and special needs housing.
•
Consider the strategic sale/disposition of existing land holdings in newly developing
neighbourhoods in order to leverage land purchases in other parts of the City.
Action
#23
The Needs Assessment identified a number of key parcels that the City may consider for the
development of affordable housing or for sale or transfer to support future affordable housing
developments. Having reviewed these properties, the following actions are recommended:
•
Land in Parkland Terrace adjacent to Bossio Road. This moderately sloped parcel is zoned P2
and has a developable area of +/- 1.2 hectares. It is adjacent to the Elk River and existing R1
and R1B housing. Recommendation: City-initiated rezoning, servicing, subdivision and sale of
lots for detached/semi-detached homes at full market value. Proceeds to be directed to the
Affordable Housing Reserve Fund. Alternative: The City to co-venture with builder (through
RFP) to rezone, service subdivide and build detached /semi-detached homes, each with a
secondary suite. Initial sale discounted with a housing agreement placed on the land title to
restrict resale price – FAHP;
•
Two contiguous lots in Maintown located at 3rd Avenue and 4th Street. These relatively flat
vacant sites are centrally located in Maintown near services and have a total area of 1,338 m2.
Recommendation: Enter into a partnership with a business or institution (through RFP) with
the intention of building employee-type accommodation or a mixed-use project with housing
above grade. City to provide land on discounted basis conditional on housing agreement to be
registered on land title. Potential size: 20-24 one-bedroom units.
•
Large land parcels totalling +/- 13.75 acres along Coal Creek Road east of Ridgemont and
Pinegrove. These properties – formerly, landfill site and adjacent properties – are designated as
a golf course in the OCP. There is potential contamination from former landfill.
Recommendation: Obtain appraisals (with, without remediation) and negotiate sale of
land. Direct all or portion of funds to the Affordable Housing Reserve Fund. Any residential
development in this area would also be subject to FAHP.
•
A parcel of .68 hectares in the Annex adjacent to 12th Avenue, 17th Street and the Elk River.
This R1 zoned land is adjacent to the Elk River and existing R1 housing.
Recommendation: City-initiated rezoning, servicing, subdivision and sale of +/-15 lots for
detached/semi-detached homes (or townhomes following rezoning) at full market value.
Proceeds to be directed to the Affordable Housing Reserve Fund. Alternative: City to co-
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Page 13
venture with builder (through RFP) to rezone, service, subdivide and build homes, each with
a secondary suite. Initial sale discounted with a housing agreement placed on the land title to
restrict resale price;
•
Lot on 1st Avenue in Maintown. This serviced 557 m2 site is currently a gravel parking lot and
zoned for Retail Commercial. Recommendation: Enter into a partnership with a business
or institution (through RFP) with the intention of building employee-type accommodation
or a mixed-use project with housing above grade. City to provide land on discounted basis
conditional on housing agreement to be registered on land title – FAHP. Approximate number of
units generated = 10-12.
•
Land in proximity to the CPR right-of-way south of New Horizon Village. This relatively flat site
is close to Maintown, services, and recreation amenities. Will require environmental study and
possible remediation.
Recommendation: Enter into a partnership with FFSH to develop a non-profit complex for low
income singles and families. City to provide land at no cost and assume the costs of rezoning.
4.3.2 Resources – Financial
Action
#24
Action
#25
•
Establish an “Affordable Housing Reserve Fund” to accumulate funds for subsequent
contributions to non-market housing providers (Authority: Section 188, Community Charter).
The funds for this Reserve Fund would be derived from cash-in-lieu contributions from FAHP,
voluntary amenity contributions, City land sales, and a percentage of the City’s annual budget.
The Reserve Fund would accumulate for a specified number of years (e.g., five to 10) , after
which it could be used for capital grants to non-profit housing societies and, potentially,
private landlords who were willing to participate in some form of rent restriction.
•
Use the tax exemptions provisions of the Community Charter (Section 226) for an area to
be designated as a “Revitalization Area” for the purpose of creating additional affordable
/ attainable housing. Geographically, this would include Maintown and the Annex. All new
ownership housing units that are affordable to Fernie residents at or below the AMI would be
entitled to a tax exemption of 75% for the first five years, reducing
to 50% for the second five years. (Note: Eligibility criteria to be
Fernie is fortunate to have
determined prior to implementation).
existing, experienced non-
4.4
Role #4 — Entering into Partnerships
Collaboration with the business and non-profit communities, and
Provincial agencies, will lead to creative solutions to existing and
emerging housing issues.
profit organizations as potential
partners. In particular, the
Fernie Family Housing Society
has solid administrative
capability, an experienced
Board and is well known to BC
Housing and other potential
funders.
The consultant does not recommend that the City of Fernie establish
its own municipal non-profit housing corporation at this time. The set
up and ongoing administration of such an entity is a major commitment. Instead, the consultant
recommend that the City ramps up its activity as a housing partner, with existing non-profit groups
and, potentially, local businesses and major employers.
It is noted that the City already has a Land Development Reserve Fund that has been used for
strategic purchases. The Affordable Housing Reserve Fund could be a separate fund, or sub-fund, provided
there is complete transparency of the use of any funds for affordable housing purposes only.
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Page 14
For a relatively small community, Fernie is fortunate to have existing non-profit organizations
that have demonstrated capacity to build and manage non-market housing and to deliver support
services. In particular the Fernie Family Housing Society (FFHS) has a strong track record with BC
Housing and other funders. The society was formed in September 2000 to construct and manage
New Horizon Village, a 32-unit social housing development for families, seniors and people with
disabilities.
FFHS was also the sponsor society for the 2006 redevelopment of Tom Uphill Manor, which houses
24 one-bedroom supportive units for seniors and people with disabilities, and three one-bedroom
transitional units for those seniors who are at risk of not having appropriate housing for their
specific needs. Other “partners” included Canada Mortgage and Housing Corporation (CMHC), the
Columbia Basin Trust Fund, the Real Estate Foundation of BC, the Interior Health Authority and
the Federal National Homelessness Initiative. The City participated with $96,000 in reductions of
municipal levies and taxes.
Fernie and area’s large employers (e.g., Fernie Alpine Resort, College of the Rockies, and other
established employers who may have significant numbers of short-term workers ) are also potential
partners for the City of Fernie in connection with the building of housing suitable for short-term
or seasonal residents. If the City were to partner with a private business or institution in the
form of land, capital or reduced fees, it would be important that the City and its partners enter
into a formal housing agreement that would be registered on title. The terms of these housing
agreements would vary, but would typically establish requirements regarding tenures and rents.
Action
#26
Action
#27
•
In light of the conclusions of the Scoping Study and the Needs Analysis, the City should initiate
discussions leading to potential partnerships:
>
With FFHS and others to build additional non-profit housing for low income, single and
lone parent households. The Federal Homelessness Partnership Initiative (HPI) may
be a key source of funding as the target population is “at risk of homelessness.” HPI
takes a housing-first approach in recognition that the first step to self-sufficiency is
to provide individuals with transitional and supportive housing. Under HPI’s Outreach
Component smaller cities, rural and outlying areas are eligible for funding to support
single projects to fill specific gaps in rural infrastructure to address homelessness. BC
Housing’s Community Partnerships Initiative (CPI) would be another potential source of
assistance for an innovative project.
>
With Fernie Alpine Resort and the College of the Rockies to build an apartment
building in Maintown. Units would be designed to be similar to typical college or resort
staff housing, with individual bedrooms and some shared facilities.
>
With the real estate community to build a demonstration project as a subdivision of
compact housing (e.g., small lot size, small footprint, small secondary suite). Sell
homes at cost with some resale restrictions.
>
With the Interior Health Authority, local seniors organizations and other interested
stakeholders to begin planning for another non-profit continuum of care seniors
complex.
During the Scoping Study, a number of sites that are not owned by the City of Fernie were
identified that may be suitable for affordable housing. Potentially, the City could play a role either
as a partner or as a contributor if any of these become active projects.
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Page 15
•
The College of the Rockies (CoTR)
>
•
FFHS Maintown
>
•
4.5
Max Turyk school, located in the Mountview neighbourhood, was closed this year
due to declining enrolment; the future use of the facility and site have yet to be
determined. The majority of lots within Mountview are zoned R1. However, in light of
the size and location of the property, it could be an attractive site for townhousing or,
potentially, a small lot/compact housing demonstration project.
— Recent Ministry of Education changes (Ministerial Order 233/07) require BC school
boards to ensure that there is no public requirement for surplus school buildings or
lands before selling these properties to private interests. If a property isn’t required
at the provincial level by a government agency, Crown corporation, college or health
authority, school boards are compelled to consult with the municipal government to
establish whether or not the property is required at the local level.
Role #5 — Advocacy and Capacity Building
The City has already demonstrated its commitment to affordable and attainable housing through
the Official Community Plan and the development of this housing strategy. Ongoing leadership
involves advocacy and capacity building within the community.
•
Action
#29
The FFHS site is located in Maintown North, adjacent to Isabella Dicken Elementary
School. As with the CoTR site, development constraints appear to be minimal. FFHS
has expressed an interest in developing this site for independent living for seniors and
mature single women with low incomes.
Max Turyk School Site
>
Action
#28
This site is centrally located in Maintown South. The site is flat and easily serviced.
The consultant met with a CoTR representative who expressed an interest in a
partnership opportunity with the City to pursue the development of a student housing
facility. CoTR has identified operational funding for such a facility in its five-year
capital plan. It would require a rezoning.
•
Advocacy directed towards:
>
BC Housing re: local needs, including low income households and young families;
>
IHA re: need for additional complex care beds and/or continuum of care facility;
>
Regional District of East Kootenay and the Columbia Basin Trust re: common housing
interests; and
>
Federal government through the Federation of Canadian Municipalities and other
advocate groups re: tax barriers that inhibit new purpose-built rental housing.
Capacity building directed towards:
>
Educating the business community through presentations, distribution of materials;
>
Informing individual and business landlords regarding CMHC’s lending program for
secondary suites (Residential Rehabilitation Assistance Project – RRAP);
>
Promoting existing BC housing programs:
• The Rental Assistance Program provides cash assistance to eligible low-income,
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Page 16
working families with at least one child under age 19 and a household income less
than $28,000 per year; and
• The Shelter Aid for Elderly Renters (SAFER) program provides cash payments to
subsidize rents to residents who are 60 or over; and
>
5.0
Monitoring and annual reporting on housing using the indicators from the 2007 Needs
Assessment.
Priority Setting
Ongoing
Medium
Proposed Actions
#
Short
The City of Fernie has already taken a significant steps towards housing choice and affordability
through the inclusion of statements in its OCP, and in undertaking this consultative strategy.
Implementing the proposed actions of this strategy, however, becomes the next big step, one that
requires the dedication of significant administrative resources. In recognition that the City has
many other responsibilities and competing priorities, the consultant makes recommendations – as
set out in the accompanying table – for their implementation as to whether the proposed action is
a short, medium or ongoing priority.
Role 1 – Policy Making
1
OCP – Add a policy that speaks to the City’s intent to support people
through the continuum of housing, from subsidized housing to
homeownership.
2
OCP – Add a policy that reflects that affordable / attainable housing is an
essential component of community life.
3
Request Province to designate Fernie and area as a “resort region”.
Subsequently, City to adopt DCC bylaw for employee housing.
4
Develop a Tenant Assistance Policy for the potential redevelopment of
Fernie Mobile Home Park.
Role 2 – Establishing Regulations
Removing Regulatory Barriers
5
Revise the method of charging DCCs from a per unit basis to a per square
metre basis.
6
Proactively review City zoning, subdivision and building bylaws to ensure
regulations and standards are not a barrier to affordable housing.
7
Reduce minimum lot size and width in R1 zone.
8
Consider amending zoning bylaw to permit manufactured homes in R1
zone, subject to design resolution.
9
Reduce parking requirements small lots in Maintown and the Annex.
10
Encourage developer– or neighbourhood-initiated compact housing
proposals.
Secondary Suites
11
Formalize “alternative life safety standards” for existing suites.
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Page 17
12
R1B – Reduce the minimum size requirements to be consistent with R1.
Waive or reduce application fees.
13
Reduce City service fees to 40% of the primary unit.
14
Encourage all new single detached homes to be “suite ready”.
15
Undertake a well-resourced program to bring existing non-compliant
suites into compliance. Set an annual target.
16
Set an amnesty period for homeowners with existing non-compliant
suites to disclose and upgrade.
17
Investigate the possibility of “lock-off” suites in new-build townhouses
and apartments.
18
Apply decommissioning charge for suites created in past five years.
Ongoing
Medium
Short
Proposed Actions
#
Strata Conversion
19
Rescind the existing moratorium for strata conversion. Apply conditions
on applicants as an offset – percentage remain as rental or charge.
Homeownership Program
20
Establish the Fernie Attainable Housing Program (FAHP) for attainable
homeownership. Expectations of developers; use of incentives and
options.
Role 3 – Using City Resources
Resources – Land
21
Use the City’s land to help meet affordable and special housing needs.
22
Acquire land as opportunities become available. Bank this land for future
use for affordable and special needs housing.
23
Sell existing City-owned land in newly developing neighbourhoods.
Specific recommendations for six properties.
Resources – Financial
24
Establish an Affordable Housing Reserve Fund.
25
Designated Maintown and the Annex as a “Revitalization Area” to create
affordable / attainable housing.
Role 4 – Entering into Partnerships
26
Initiate discussions leading to potential partnerships re: City owned land.
27
Make a contribution to projects initiated by others.
Role 5 – Advocating and Building Capacity
28
Continue to be an advocate for affordable/attainable housing – BC
Housing, IHA, CMHC, foundations, other funders
29
Continue to build capacity within Fernie – business, lenders, community
organizations
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Page 18
6.0Administrative considerations
It is beyond the scope of this strategy to suggest how the City’s administration might respond to,
or carry out, the actions identified in the strategy. Based on previous experience, however, if the
City were to move forward proactively, it is likely that additional resources will be required. At a
minimum one FTE would be required.
Four of the most challenging and time consuming aspects of the strategy relate to:
>
Secondary Suites: Developing and carrying out a program to bring non-complying
suites into compliance / alternative life safety standards; education and promotion.
>
Fernie Attainable Housing Program: Developing and implementing this mixed-income
homeownership program.
>
Partnerships: Initiating and carrying through on partnerships with housing providers,
employers, business community. Includes land sales, banking, co-ventures.
>
Policy / regulatory amendments: Taking administrative steps to carry through specific
actions. Individually, these may not be onerous but collectively, they take considerable
time, attention to details, and potentially community consultation.
If Council decides to proceed with specific elements of the proposed strategy, CitySpaces would
be pleased to provide assistance, either in the further development of the proposed FAHP, or
in applying for Pre-Development Financing (BC Housing) for one or more potential partnership
projects.
7.0
Closing comments
It takes multiple, sometimes controversial, approaches to make headway on affordable and
attainable housing, and a strong network of government, community and business partners to
help people move through stages of the housing continuum. From our consultations in Fernie,
it is evident that the will and capability is there to accomplish great gains. We are confident
that proposed City roles and actions of this strategy, if acceptable to Council and the broader
community, will make a significant contribution towards meeting the housing needs for residents
with least choice and greatest needs:
>
Low income individuals and families;
>
Seniors requiring support in addition to housing;
>
Prospective first-time homebuyers; and
>
Seasonal workers.
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
October 2007
Page 19
Appendix A
Fernie — Scoping Study
Table of CONTENTS
1.0 Context.............................................................................2
2.0 Approaches and Resources.......................................................2
3.0 Findings
Main challenges...................................................................2
Meaning of affordable and attainable housing..............................5
Population groups................................................................6
Role of employers................................................................8
Role of developers................................................................9
Awareness of other communities..............................................9
Paying for affordable housing..................................................9
Role of financial institutions................................................. 10
Role of City of Fernie.......................................................... 10
Specific Suggestions............................................................ 10
4.0 Next Steps........................................................................ 12
Appendices
Appendix A
List of Participants: Stakeholder Consultation
Scoping Report
Affordable and
Attainable Housing
Prepared for
The City of Fernie
June 2007
Page 1.0
Context
The Fernie area’s economy is in transition from one based primarily on mining and forestry to
one with a significant resort-recreational component. The expansion of Fernie Alpine Resort
and Cranbrook Airport, new golf course developments, and the proximity to the buoyant
Alberta economy are major drivers of this transition. Although Fernie residents and businesses
welcome economic diversification, recent growth has produced unanticipated consequences.
One such consequence is the tsunami-like change in the housing market. Today, demand
significantly exceeds supply — for land, ownership housing and rental accommodation — and
housing prices and winter rents have escalated precipitously.
In March 2007, the City of Fernie engaged CitySpaces Consulting to analyze the current
housing situation and to develop a strategy to direct how the City, together with potential
community partners, should address issues of affordable and attainable housing. As a
precursor to this strategy, CitySpaces conducted a scoping study to identify Fernie’s housing
issues. This report outlines the findings.
2.0Approach and Resources
This scoping study is based on information gathered during an initial stakeholder consultation
plus two well-attended community workshops held on May 24th.
• Our stakeholder consultation involved the use of a semi-structured questionnaire.
A list of the people with whom we spoke is contained in Appendix A.
• The workshops involved a series of storyboards and a short presentation,
followed by small group discussions. Seventy-two of the approximately 100
attendees filled in a questionnaire.
3.0Findings
The following section summarizes the responses to the questions that were posed during the
stakeholder consultation process and community workshops. The consultants’ observations
and comments are based on an analysis of the responses.
1. Do you think there are challenges for long-time residents and newcomers
related to housing? If so, what are they?
Challenge — Home ownership is not attainable for many working people.
Stakeholder Comments
There is a high demand for housing from people who do not live in Fernie on a full-time
basis — primarily second homeowners. In recent years, new and resale housing prices have
escalated rapidly. Many people on a “working wage” cannot afford to buy a home here. If
young people are able afford to live here they will stay — it is an attractive community with
a range of services. A key challenge is to create a larger number of well-paying jobs that will
allow prospective homeowners to compete in Fernie’s housing market.
Workshop Findings
Seventy-three percent strongly agreed with this challenge statement; 21% agreed somewhat.
During the workshops, there was discussion about the disparity of wages between the service
/ hospitality sector and the mining industry. Some households do have purchasing power in
the market, principally those with two professional incomes. Some people blame speculators
and realtors for driving up the price of land and housing beyond what a household with a
moderate working wage can afford. Concerns were also expressed regarding the type of
Scoping Report
Affordable and
Attainable Housing
Prepared for
The City of Fernie
June 2007
Page housing being developed in that it is geared toward recreational-/second-home purchasers
as opposed to the local population. There were a number of younger participants at the
workshop who said they want to stay in Fernie, but question whether their income is
sufficient to purchase a home. Some people were sympathetic to people in this situation,
while others felt that they should move to less expensive locations in order to build home
equity.
Consultants’ Observations and Comments
• Fernie is experiencing the growing pains of a relatively small community facing
an unexpectedly strong economic demand for housing. Overall, demand has
exceeded the supply of new and resale housing, creating a rapid run-up in
housing prices.
• The local building industry is small and has been hard-pressed to respond to the
growing demand. Investors— both local and from other cities — have seen an
opportunity to profit from purchasing land and existing housing.
• Aspiring first-time homebuyers with a “working wage” of $50,000 to $70,000
are impacted by competition from recreational/second home purchasers and
amenity migrants.
• Illegal suites are prevalent in many Fernie neighbourhoods (e.g., Airport
Neighbourhood) but they are “mortgage helpers” for some households. Banking
institutions take the income from suite rental into account when determining a
household’s ability to carry a mortgage. If closure of these suites was actively
enforced by the City, this would affect home owners as well as renters.
• Housing is less expensive in Sparwood and Elkford and some households have
purchased elsewhere in the Elk Valley where housing prices are lower. If
this trend continues unabated, it will have a destablizing impact for Fernie,
potentially leading to the undermining of this family-friendly, multi-generational
community.
Challenge — There are limited housing choices for renters.
Stakeholder Comments
There are limited options for rental housing both in terms of affordability and availability.
Options for tenants with pets are very limited, as many landlords will not allow pets.
Existing apartment buildings are usually fully rented and there has been no new rental
accommodation built for a number of years. Rooms and secondary suites in homes in
Maintown and the Annex are an important source of rental accommodation, particularly for
seasonal workers. Also, some condominiums and individual homes are owned by investors and
rented out. Overall, it is easier to obtain rental accommodation over the summer months,
although in some cases, landlords only want short-term leases because they are able to
command much higher rents during the winter ski season. For low income families and single
people, the Fernie Family Housing Society operates the New Horizon Village. The wait list is
long and there is little turn-over. The Fernie Hotel and The Northern have some rooms that
are available on a monthly basis, rented primarily by low-income single men.
Workshop Findings
Forty-six percent strongly agreed and 33% somewhat agreed. Of the five “challenge
statements”, this showed the lowest level of agreement.
Scoping Report
Affordable and
Attainable Housing
Prepared for
The City of Fernie
June 2007
Page Consultants’ Observations and Comments
• Across Canada, very few developers are building new rental apartment buildings,
and this is this is unlikely to change in the near future. Market rents do not
support economic rents for investors. But the demand for rental accommodation
keeps growing.
• Fortunately, in Fernie, there is an “informal supply” in the form of secondary
suites and investor-owned homes and condominiums. This informal supply is
extremely important — without it, rents in purpose-built rental housing would be
higher.
• The City had the foresight to permit secondary suites in detached homes,
creating the opportunity for additional rental housing. Not all homeowners,
however, want to have a secondary suite. And, not all existing secondary suites
meet the standards of the BC Building Code.
Challenge — Rental housing conditions are variable.
Stakeholder Comments
There were issues raised regarding the quality of maintenance of rental accommodation and
concerns about an increasing number of break-ins. There is a perception among some renters
that landlords don’t need to maintain rental units because the demand for housing is high,
leading to a prevailing sentiment that “if you don’t like it then find someplace else because
someone else won’t mind”. On the other side, concerns were raised with regard to shorterterm tenants and there is a sense that landlords may be reluctant to maintain rental units if
there is a fear of property damage.
Workshop Findings
Forty-nine percent strongly agreed with the challenge statement; 38% somewhat agreed.
During the small group conversations a number of people raised concerns about the condition
of rental properties (interior, exterior), particularly by absentee landlords. Some people felt
there should be improved enforcement of poor conditions.
Consultants’ Observations and Comments
• The concerns that were raised by renters and landlords are not uncommon in a
community where a significant part of the labour force is seasonal and turnover
is high. The needs analysis will further explore the question of enforcement of
standards related to life safety and public health.
Scoping Report
Affordable and
Attainable Housing
Challenge — Housing issues lead to other social and community issues.
Stakeholder Comments
Fernie has a high number of service-sector employees, earning minimum, or slightly above,
minimum wage. Many service sector employees work more than one job in order to make ends
meet. It was noted that this relates to health concerns such as depression and challenges for
family stability. High costs of housing also lead to situations where many people are sharing
rental accommodation in order to reduce living expenses. This is frequently the case with
seasonal employees who are in Fernie for a short time and generally speaking, want to have
a good time. Having “12 partiers” living in the same place is perceived negatively from a
neighbourhood perspective, especially in relation to noise, nuisance and traffic issues.
Workshop Findings
Eighty-one percent strongly agreed with this challenge statement; 16% agreed somewhat.
There was considerable discussion among the small groups about how housing issues can have
Prepared for
The City of Fernie
June 2007
Page a much wider social impact –on individuals and their families (stress); and on neighbourhoods
(quality of environment). A number of people described their own experiences (e.g., single
mother of three, long-time resident living in a party neighbourhood, long-time resident
finding he was the only one living year-round on his 10-house block).
Consultants Observations and Comments
• The health and social impacts related to housing issues often go unsaid for
a number of reasons. The fact that comments of this nature were raised by
stakeholders and the workshop participants is revealing. Health and social
service providers may already be aware of this situation.
Challenge — The lack of housing impacts employee recruitment and
retention.
Stakeholder Comments
Employers report having difficulty with recruitment and retention of workers, in part due
to high costs and limited choice of housing. Health care is one sector where employers
have particular difficulty recruiting qualified staff. Given that the Interior Health Authority
includes Fernie, Elkford, and Sparwood in the same “health area”, Sparwood and Elkford
are recommended as more affordable options for housing. However, many health care
workers, particularly emergency services employees, want to live close to their workplace.
Fernie Alpine Resort indicated that, while it has not had a problem to date recruiting winter
employees due to housing, management is aware that this may become an issue.
Workshop Findings
Eighty percent agreed strongly with this challenge statement; another 18% agreed somewhat.
Of the five challenge statements, this one ranked highest. During the workshop, there were
a number of discussions about the long-term effects of not being able to attract “necessary
workers” (i.e., health workers, police, educators). The situation is particularly difficult for
Elk Valley Coal where it must compete for skilled workers who are attracted to other areas
paying higher wages or offering more flexible work arrangements, such as fly-in/fly-out to
northern mines. Also, a representative from Fernie Alpine Resort (FAR) indicated that it seems
to be more difficult to recruit winter workers than in prior years. While he noted that this is
primarily related to a demographic shortfall of young adults, he acknowledged that FAR would
be monitoring the housing situation in Fernie.
Consultants Observations and Comments
The labour market bust has been talked about by demographers for decades but it is only now
having a widespread impact. With labour in short supply, workers gravitate to where wages
are high and suitable housing is available. Fernie is challenged on both accounts.
2. What do you consider to be “Affordable housing”? “Attainable housing”?
Stakeholder Comments
There was a wide range of responses to this question. Some felt that affordable housing
refers only to government subsidized housing for low income people (e.g., social assistance,
disability, fixed income). A number of people cited New Horizon Village as a local example.
Others considered affordable housing more generally — as a relationship between a
household’s income and the costs of housing. One interviewee stated, “Affordable is a moving
target. Today, anything under $260,000 I’d consider affordable, but it’s picked off as soon as
it comes to the market.” Some suggested that affordable housing can be more clearly defined
as housing that costs no more than a fixed percentage of gross household income (i.e., 25%,
30%, 33%). For most stakeholders, the term “attainable housing” was not familiar.
Scoping Report
Affordable and
Attainable Housing
Prepared for
The City of Fernie
June 2007
Page Workshop Findings
The discussion at the workshops paralleled the comments from the stakeholder interviews.
However, the discussion broadened in an interesting fashion, away from an absolute definition
of terms, towards viewing housing as a community issue. The comments on the flip-charts are
illuminating:
• We need mixed-income and multi-generational neighbourhoods in our
community;
• People perform different and important roles in our community — they all need
housing;
• People need to set roots in our community — but they won’t if they can’t afford
housing;
• Young people need to be reasonable — start small and work their way up. Not
everyone started with home ownership at a young age.
• Shelter should be available at every level of income — it doesn’t matter if it is
rental or home ownership;
• The lack of housing choice acts as a barrier to recruiting employees;
• Many landlords take advantage of seasonality — they charge lower monthly rents
in the summer than in the winter. So, rents are “affordable” in some months, not
in others;
• Seniors are moving away because of lack of choice and tax increases; and
• We will be a community of choice if we have a variety of housing options for
different incomes and where people can still have a comfortable life while
owning a house.
Consultants Comments
• The term, “attainable housing”, has been suggested as an alternative to
“affordable housing” as it has fewer negative connotations and is viewed as
being broader than government subsidized housing.
• Just as there is no common definition of “affordable housing”, there is no
common definition of “attainable housing”. Increasingly, housing analysts use the
term to refer to housing for people who fall in the gap between being eligible
for government supported housing and the ability to pay market rents or home
prices. Depending on the circumstances of a community, this may be a very small
or a very large gap. In Fernie, due to the rapid escalation of housing prices, the
number of households falling into this gap is likely increasing. This will be further
investigated in the needs analysis.
• It was interesting to see the discussion at the workshops migrate to the
importance of having a full range of housing choices, not solely a discussion of
“affordable and attainable” housing.
Scoping Report
Affordable and
Attainable Housing
Prepared for
The City of Fernie
3. Are there particular sub-groups that you think need special attention in
relation to housing?
Through the stakeholder consultation and the workshops, a number of sub-groups were
identified as having unmet housing needs. These include: low-income singles and families,
young families and single-parent families, seasonal workers, seniors, people with disabilities,
out-of-town students attending specialty courses at The College of the Rockies, women
seeking refuge from abusive relationships, and young professionals (i.e., teachers, nurses,
ambulance attendants).
June 2007
Page Low-income singles and families
It was widely viewed that people with low incomes have difficulty finding and keeping housing
that is affordable. The Fernie Family Housing Society has indicated that there are currently
(as of May 2007) 74 applications on file for individuals and families who are seeking housing
in New Horizon Village, a 32-unit social housing development for families, seniors and people
with disabilities. The average wait time for people on the wait list is approximately one to
two years depending on an assessment of need (based on income, current housing, personal
and health status).
Young Families and Single-Parent Families
Young families were most often identified as the sub-group with the greatest unmet housing
needs — their household incomes are insufficient to purchase a home. An additional challenge
for young families relates to the lack of affordable daycare facilities in Fernie. This need
has become apparent, as a small group of young parents have recently joined together to
form the non-profit Fernie Daycare Society. Respondents also noted significant challenges for
single-parent families who find it difficult to support a household on one income.
Seasonal Workers
Typically, there is greater competition for rental units during the winter season with the
influx of seasonal workers and reduced rental housing availability due to recreational
properties being used for short-term vacation accommodation; hence, it is typical for rental
rates to go up over the winter months. As Fernie Alpine Resort does not provide housing for
its staff, resort workers generally live in Fernie. Notably, these workers are required to find
their own housing and must have housing prior to commencing work. Seasonal workers are
also employed by smaller businesses within Fernie’s tourism and hospitality sector. Generally,
these workers face the same housing challenges faced by FAR employees. It is typical to see
many seasonal workers sharing accommodation in order to afford to live in Fernie. There are
reports of poor value for money, unresponsive landlords and poorly maintained premises.
Seniors
Seniors and others involved in the initial stakeholder consultation and workshops articulated
that there is a lack of suitable housing for independent seniors who want to downsize to more
modest homes. These seniors are able to cook and to care for themselves; however, they
no longer want the burden of having to maintain their properties (i.e. clean gutters, mow
lawns, shovel snow, etc.). They don’t require the same degree of assisted living that would be
provided at a facility such as Tom Uphill Manor and might consider the units at Trinity Lodge
to be too small. They are looking for reasonable living facilities, preferably on one level. At
the workshops, there was a widely-held view that seniors have unmet needs.
Existing Homeowners
Some existing homeowners face challenges related to housing. Those that chose to move to
larger premises due to family or lifestyle circumstances will face higher costs if they remain
in Fernie. Or, they may decide to move elsewhere in the Elk Valley where their equity will
stretch farther. Other homeowners — particularly those on pension incomes — are concerned
with the prospect of higher property taxes.
Scoping Report
Affordable and
Attainable Housing
Prepared for
The City of Fernie
June 2007
Page 4. What role, if any, do you think employers should have in relation to housing
for their employees? Are you aware of any local employers that are assisting
their employees to find appropriate housing?
There were varied opinions about the role of employers. Generally, people see larger
employers, such as FAR and Elk Valley Coal as having more responsibility and interest in
ensuring that their employees have adequate, affordable housing than would a business
that employs a relatively few number of people. Some people felt that, regardless of size,
employers will need to offer incentives or subsidies to employees if they want them to stay.
This could be in the form of a low interest second mortgage or a forgivable down payment,
if the employee stays for a specific period of time. Other people voiced the view that if
employers raise wages/salaries, employees will find housing that is suitable to their needs.
Fernie Alpine Resort
Fernie Alpine Resort employs approximately 600 seasonal workers annually who are required
to find their own housing. FAR refers potential employees to the Fernie Chamber of
Commerce and Fernie Free Press.
Consultants’ Note
The Fernie Alpine Resort Official Community Plan (OCP) requires that employee housing
units be provided once there are 450 bed units in the Resort’s village core. There are
currently 212 bed units and according to the East Kootenay Regional District (EKRD), it seems
unlikely that planned additional development in the village core will trigger the requirement
for employee housing. The EKRD is working with the owner of the resort to review the current
OCP.
Elk Valley Coal Company
The mine (and its predecessors) has a history of providing housing for its employees. During
the 1970s and 1980s, the company built apartments for its employees in Sparwood. The
company also provided forgivable loans of $20,000 as part of a down payment assistance
program during the 1980s. According to the company’s spokesperson, Elk Valley Coal began
to sell its apartments after 2000 and the company does not currently provide any housing for
professional staff or management.
The Elk Valley Coal Company is a major employer of permanent workers in the area. The
company hires approximately 250 new employees annually. The majority reside in Elkford and
Sparwood, although others live as far away as Cranbrook, Kimberley and Lethbridge. As of
March 2007, the breakdown of employees by place of residence is:
Place of Residence
Scoping Report
Affordable and
Attainable Housing
Number of
Employees
Elkford
Sparwood
East Kootenay
(Cranbrook, Kimberly, Hosmer)
706
625
Crowsnest Pass and Lethbridge
408
Fernie
396
496
Prepared for
The City of Fernie
June 2007
Elk Valley Coal is a major financial contributor to the area’s tax base. The mine pays approximately
$7 million in property taxes annually, which is distributed to communities in the region. Fernie’s share
is approximately $2 million.
1
Page Other Employers
As part of the stakeholder consultations, some employers indicated that, on occasion, they
offer financial incentives to draw employees to Fernie. These are generally for professional
or management level positions. For an organization such as the Interior Health Authority, the
decision to offer relocation assistance to employees must be balanced against operational
funding.
Island Lake Lodge was identified as one employer that is providing a limited amount of
employee housing in a three bedroom prefabricated home, to accommodate key staff such
as the lead guide, caretaker, chef, and other guides. Island Lake Lodge may pursue the
development of additional employee housing either at the resort or in Fernie in the future.
Historically, mining companies were involved in housing for their employees. The consultants
were told that, during the 1950s, the Kaiser Coal Company built housing in the Annex
neighbourhood and provided forgivable mortgages to employees, if they stayed with the
company for 10 years.
5. What role, if any, do you think developers should have in relation to
affordable and attainable housing in Fernie?
This question was asked at the workshops. From a review of the comments on the flip-charts
and the questionnaires, it is evident that a significant number of participants favour requiring
a contribution from the developer. The prevailing view was that a developer has a significant
financial lift from a development approval (i.e., rezoning, development period) and should
be required to meet the needs of locals, either as a set-aside of land/housing units, or in
the form of an “amenity contribution” (i.e., cash-in-lieu) as allowed through the Local
Government Act.
6. Are you aware of communities similar to Fernie that are experiencing
housing challenges? Are you familiar with the approaches they have taken to
address these challenges? Are these potentially suitable for Fernie?
Only a few respondents indicated that they were familiar with approaches in other
communities experiencing similar conditions. Whistler, Canmore and Fort McMurray’s
interventions were noted by some. The managers of Fernie Alpine Resort, however, have
followed the approaches being taken in other ski resort areas.
7. If there is a “price to pay” for the development of some affordable housing,
who should bear the cost? All property taxpayers? New residential development? New commercial development?
Responses to this question were mixed, ranging from “not the taxpayers” to “those who
benefit from development should bear the cost” to “there needs to be a combined effort
through partnerships”.
Several interviewees expressed the view that developers should bear responsibility for
providing affordable housing either through the construction of affordable units in new
developments, or through financial contributions. Developers on the other hand conveyed
that they are already incur significant development costs and do not feel they should
solely be responsible for providing affordable housing. They also stated that development
requirements with a financial impact need to be known upfront rather than mid-way through
the development review process. Uncertainty regarding development requirements is
frustrating for developers.
Scoping Report
Affordable and
Attainable Housing
Prepared for
The City of Fernie
June 2007
Page The consultants heard that developers were not generally opposed to affordable housing
in Fernie although there was not great support for including affordable housing in their
developments. There was some apprehension about the impact of affordable housing on the
quality and character of neighbourhoods. Some suggested that if the housing were provided
to permanent, long-term residents with a desire to positively contribute to the community
then this would be acceptable.
There was a prevalent view that property taxes and fees are already high and that any
additional charge associated with affordable housing would not be welcomed. However, some
respondents suggested that they would be willing to share the cost of providing affordable
housing if this would benefit the community as a whole.
8. What role, if any, should local financial institutions play in relation to
affordable housing?
This question was asked of stakeholders. Financial institutions were identified as having the
ability to do more to help residents obtain ownership housing in Fernie through mechanisms
such as lower interest rates, longer-term mortgages, and zero-down mortgages. There was
some sense that the longer-term amortization and zero-down payment mortgages may not be
sustainable and lead to problems for financial lenders and homeowners in the future.
9. What role do you think the City should play in the area of
housing?
Many people suggested that it is the City’s responsibility to take a leadership role in
addressing Fernie’s housing issues. There were mixed views as to whether the City is really
prepared to take a leadership role, or just continue to talk about housing issues. Some
suggestions for the City included:
• Use City land for affordable housing;
• Negotiate for Provincial Crown land for affordable housing;
• Provide incentives to developers to create affordable housing units (i.e., waive
fees, defer property taxes, give Development Cost Charge credit);
• Rezone land to ensure ready supply for developers/builders;
• Ensure affordable housing is integrated into all new projects and
neighbourhoods;
• Require developers to provide a certain percentage of affordable housing within
their developments;
Scoping Report
Affordable and
Attainable Housing
• Increase developer charges;
• Annex land in West Fernie, Hosmer;
• Encourage subdivisions or bare land stratas that have small lot modular homes;
Prepared for
The City of Fernie
• Create a housing authority to build and manage housing, governed by a board of
community members — use the Whistler model;
• Work with the Regional District to achieve policy/regulatory consistency;
• Reduce property taxes in some situations;
• Tax reductions for year-round residents; extra taxes for second-home owners;
June 2007
• Cap rents on non-market housing;
Page 10
• Buy land for affordable housing — long-term land bank;
• Require developers to provide a certain component of their development as
“affordable housing” and cap resale values; and
• Pursue partnership initiatives to build more affordable housing.
10. Do you have any specific suggestions to address affordable and
attainable housing that should be considered as part of this
study?
This question was asked at the workshops. Some specific suggestions were:
• Use specific sites for affordable housing.
− Provincially-owned land north of Highway 3 and the Elk River at East Kootenay
Trail;
− Park in Ridgemeont;
− Max Turk School site;
− Parcel across from New Horizon Village (between Ridgemont Avenue and CPR
right-of-way;
− Parcel between Tom Uphill Manor and Isabella Dicken School;
− West Fernie;
− City-owned parcel between Bosso Road and the Elk River;
− City Yard between New Horizon Village and the Trico parcel;
• City to relax code requirements for secondary suite (i.e. equivalencies);
• Lift moratorium on non-stratification of rental suites;
• At rezoning, City should retain some lots are retained for future affordable
housing;
• Look at things that are working: New Horizons, Trinity Lodge, Tom Uphill Manor;
• Establish a surcharge on non-resident property owners. Allocate this money to
affordable housing;
Scoping Report
Affordable and
Attainable Housing
• Provide incentives for developers;
• Use tax provisions of Community Charter – phase in of property taxes.
Permanent residents — incremental charge.
• Waive development fee if developer agrees to rental for specific period.
Prepared for
The City of Fernie
4. Next Steps
Working with the materials and opinions gathered to date, the consultants will undertake
further investigation and quantification of the housing situation in Fernie and area. This
research and analysis will be produced in report format, for review with the project’s
Steering Committee.
June 2007
Page 11
APPENDIX A — LIST OF PARTICIPANTS : STAKEHOLDER
CONSULTATION2
• Affordable & Attainable Housing Strategy Steering Committee
• City of Fernie Council
• City of Fernie Official Community Plan Implementation Steering Committee
• Leah Bradish, College of the Rockies
• Mike Delich, Fernie Vacation Properties
• Tammy Molander, Fernie Real Estate
• Jason Kelder, Trico Homes
• Corrie Hurlburt, New Horizon Village
• Gayle Vallance, Elk Valley Society for Community Living
• Lyall Laface, New Horizon Village
• Bill Inglis, New Horizon Village
• Mike Derksen, New Horizon Village
• Cindy Gallinger, Elk Valley Coal
• Amanda Ridgway, Fernie Womens Resource Centre
• John Birrel, Consultant to Island Lake Resort
• Lynn Flokstra, Fernie Chamber of Commerce
• Karyn Morash, Fernie Hospital
• Fernie Daycare Society
• Eric Johnstone, East Kootenay Credit Union
• Dave Brooks, BC Ambulance Service
• Tanya Rookes, BC Ambulance Service
• Mark Elson, Fernie Alpine Resort
• Reto Barrington, Glenstal Group of Companies
• Evelyne Cutts, Fernie Resident
• Jennifer Krotz, Columbia Basin Trust
Scoping Report
Affordable and
Attainable Housing
• Sara Muir Owen, Real Estate Foundation of British Columbia
• Stacey Smith, Elk Valley Job Seekers
• Rocky Mountain Village
• Andy Cohen, Fernie Alpine Resort
Prepared for
The City of Fernie
• Karen Higgins, East Kootenay Regional District
• Steve Kuijt, Island Lake Resorts
• Neil Watson, Part-time Resident
• John Paone, Alfred Horie Construction Ltd.
June 2007
Appendix A
Participants were interviewed or consulted either individually or in small group settings. The majority
of interviews were conducted during the initial scoping phase in Fernie during the last week of March.
Follow-up interviews were conducted via telephone or in person during April and May.
2
Appendix B
Fernie — Needs Assessment
AFFORDABLE & ATTAINABLE HOUSING IN FERNIE
Phase Two — NEEDS ASSESSMENT
1.0 Introduction
During the first phase of the Affordable and Attainable Housing Study, stakeholders and
members of the public identified five major challenges related to housing in Fernie (see
sidebar). They also identified a number of groups within Fernie that
they feel have unique and unmet housing needs. Drawing from the
questionnaire distributed at the public workshops, in response to the
Five Housing Challenges
question, “Are there particular groups that you think have great difficulty in accessing suitable housing at a price/rent they can afford?”,
•Home ownership is not attainable for
the following were identified most frequently:
many working people. As house prices
rise, fewer young households are able
• Low income single people and low income families;
to purchase a home.
•
Seniors, particularly those who do not require assisted living
but need smaller, lower-maintenance housing;
•
First-time prospective home purchasers;
•
Seasonal workers; and
•
People with physical or mental disabilities
•There are limited housing choices
for renters. There is little turn-over
in rental housing for low income
households, single parent families and
people with disabilities.
The findings from the first phase were documented in CitySpaces’
Scoping Report, June 2007.
•Rental housing conditions are
variable. This second phase of the study involved examining the perceptions
of housing need coming out of the study’s first phase in relation to
“hard data” — demographic, housing and income statistics. This helps
to quantify the current situation and provides a basis for evaluating
housing needs. The “assessment of need” becomes a key element
in the third phase of the study — developing housing policies and
implementation strategies.
•The lack of housing impacts employee
recruitment and retention.
•Housing issues lead to other social
and community issues.
During this phase, the consultants also reviewed the City’s current policies and
regulations to identify how they either facilitate or impede affordable and attainable
housing.
2.0 Needs commentary
“Resortification” is happening throughout BC, most noticeably in the mountain and lake
settings of the Kootenays, Shuswap and Okanagan where buyers from higher-priced
markets affect the type and cost of new housing. This has a significant and long-lasting
effect on the ability for many working people to afford suitable housing in these areas.
This clearly is the situation in Fernie.
There is no universal measure to express affordable or attainable housing need,
but there are several indicators that are typically used to identify and describe a
community’s housing circumstances. Appendix A contains a series of indicators, presented
Fernie Housing Needs Assessment
CitySpaces Consulting Ltd.
24 July 2007
Page in the form of charts and tables, that illustrate key factors in relation to an assessment
of housing need in Fernie. They cover these topics:
•
Demographic indicators
•
Economic indicators
•
Income indicators
•
Housing indicators
•
Housing affordability indicators
•
Government / non-profit housing indicators
•
City of Fernie regulatory environment
The assessment examines the needs of Fernie residents by each of four sub-groups, and
asks three key questions:
•
Is housing available at a rent or price that is affordable relative to income?
•
Is it suitable for the number and age of people in the household?
•
Is it adequate from the point of view of personal safety,
health and security?
Tamara
John
Low income single people and low income families
Rhys and Savina
The data confirms that Fernie’s low income single people and low
income families have the greatest challenges in securing adequate,
suitable, affordable housing. Fictional characters Rhys and Savina,
John, and Tamara with her two children are illustrative of Fernie
residents with low incomes. Tamara is a single parent; John is disabled; and Rhys and
Savina are hospitality workers. Consider these statistics:
Income and Affordability Data (2005)
•
•
Non family households
• Median income • Amount available for housing @ 32% of income
• Percent making less than $25,000
Lone parent families
•
•
•
•
•
Median income Amount available for housing @ 32% of income
Percent making less then $25,000
Percent of taxfilers > 25 years making > $25,000
$32,300
$861 mo
42%
85%
Core Need Households (2001)
•
•
$20,900
$557 mo
57%
Percent of non-family households STIR for non-family households 16%
48%
STIR = Shelter-cost-to-income ratio
Fernie Housing Needs Assessment
CitySpaces Consulting Ltd.
24 July 2007
Page BC Government Income Assistance
•
•
•
•
A single Expected to Work client is eligible to receive a monthly
maximum of $375 for shelter in addition to $235 monthly benefits
A single Expected to Work parent with two children receives $1,036
A single person with disability receives $906
In the Elk Valley, 217 households received income assistance in June.
(161 single people and 56 families).
Other Indicators
Rental vacancy rate winter Rental vacancy rate summer Rents for shared accommodation
Rents for one bedroom
Rents for two bedroom
Number on wait list for New Horizon Village
New family social housing units built in last 7 years New purpose built rental housing built in last 10 years
<1%
<5%
$375+
$500+
$1,000+
>70
0
< 10 (est.)
Seniors
The analysis indicates that a number of seniors have assets (primarily
in their home) and reasonable incomes in relation to shelter costs. The
difficulty is lack of choice of suitable accommodation, particularly for
seniors who are not ready to downsize radically or to require assisted
living. Our “representational” seniors — Phyllis and Frank and Etta — like
many Fernie seniors we spoke with, would like single-level living (e.g.,
condominium) near services, at a price they consider “reasonable”.
Phyllis
•
•
•
•
•
•
•
•
In 2006, people age 65+ represented 10% of the population of the Fernie Local
Health Area (includes Sparwood and Elkford). The BC government’s projections
indicate that seniors will account for 13% of the population by 2011 and 23% by 2021.
It is evident that there will be a growing need for suitable and affordable housing for
seniors.
Frank and Etta
While the private market is likely to respond to some of this demand, those seniors with
fixed incomes and few assets are likely to require additional housing that cannot be
delivered through the private market. Consider these statistics:
Income (2005)
•
•
Couple families where the older spouse was 65+ years
»
Made less than $40,000 »
Median income
37%
$49,100
Core Need Households (2001)
» Percent of senior households BC Ministry of Employment and Income Assistance, 2007
Fernie Housing Needs Assessment
CitySpaces Consulting Ltd.
24 July 2007
13%
Page »
41%
Number of seniors-oriented units in Fernie
»
Trinity Lodge (37 units, independent living, waitlist 1 year+)
»
Tom Uphill Manor (27 units, supported independent living)
»
Rocky Mountain Village (12 units of supportive housing, 12 units of
assisted living and 51 units of nursing care. Waitlist 1 year+
for supportive housing)
First-time prospective home purchasers
Evelyne, and Sally and Mike are fictional people who represent twentysomething Fernie residents that are interested in making a long-term
commitment to Fernie, IF they are able to purchase a home. Evelyne
works as a hospital nurse, and Sally is a stay-at-home mom while Mike
is a banker.
Sally and Mike
•
STIR for senior households Income and Affordability Data (2005)
•
•
Couple with one child
• Annual median income
$89,000
• Percent households making <$60,000
31%
• Amount available for housing @ $60,000 income $1,600
• Maximum purchase price @ $60,000 income/10% dp $180-$185,000
Couple households with two children
• Annual median income
• Percent households making <$60,000
Evelyne
$91,600
21%
Core Need Households (2001)
•
•
Percent of family households in core need
STIR for all couple households 7%
57%
Other Indicators
Median Sale Price
•
•
•
Detached home in Fernie
Detached home in Elkford
Condominium home in Fernie
$344,560
$212,727
$214,490
Seasonal workers
Amber
•
Seasonal workers and college students are another group that has been
identified as finding a great deal of difficulty securing affordable, adequate
housing. Amber and Gareth are two fictional people who represent this group
of Fernie residents. They are a vital part of the valley’s economy, providing
a range of services in the hospitality, recreational and retail industries. There are few
indicators to adequately assess this need, as many in this group do not file tax returns
with a Fernie address. But, consider the following information:
March 01 to May 31, 2007.
Fernie Housing Needs Assessment
CitySpaces Consulting Ltd.
24 July 2007
Gareth
Page •
Most entry level hospitality and retail jobs
$8-$10/hour
•
Number of seasonal workers @ Fernie Alpine Resort
approx. 600
•
Amount available for housing @ 32% of income
$400-$480/mo
3.0 Needs Assessment
Based on discussions at the public workshops, stakeholder interviews and an analysis of
population, income and housing data in Appendix A, we make the following observations
regarding housing need in Fernie:
•
The private market is primarily building new product (detached homes,
condominiums) for higher income earners, many of whom are second home
and recreational purchasers. This is a natural market response to obvious
demand and is likely to continue. Most new detached homes are priced
substantially beyond the purchasing ability of most working people living in
Fernie.
•
The resale market has been affected by the new housing market, resulting in
substantial increases that price a number of working people living in Fernie
(or contemplating moving here) out of the market.
•
The rental market is substantially unaffected by out of town purchasers and
rents have remained within reach of working people living in Fernie. The
quality of rental housing, however, is widely varied. Although information
is anecdotal, purpose built rental accommodation is generally adequate
in terms of size and quality; however, other forms of rental (e.g., shared
accommodation, some second suites) are viewed as unsuitable and/or poorly
maintained by absentee landlords.
•
In terms of each of the sub-groups identified as being most in need, we make
these comments:
»
The housing needs of low income single people and low income families
cannot be fully satisfied by the private market and the supply of existing
government supported supply is static. We estimate that there is an
unmet need of approximately 30-40 units. While there are currently no
government programs to build additional units similar to New Horizon
Village, the government has a relatively new Rental Assistance Program
to assist low income people renting in the private market. The extent to
which this is being used by Fernie residents is confidential information.
»
The housing needs of seniors will grow as Fernie’s population ages.
There are currently waiting lists at Trinity Lodge and Rocky Mountain
Village for independent living units. This suggests that there is an
immediate opportunity for approximately 20-25 modestly finished,
well-priced one-level condominiums. Over time, this demand could
grow at approximately 10 units per year. (Note: The consultants have
not undertaken a specific market study for this type of housing. A survey
of seniors would be required to verify this anticipated demand.) The
BC government has phased-out its “Independent Living” program. The
primary BC government measure specifically available for seniors is the
deferral of property taxes (after age 55).
Fernie Housing Needs Assessment
CitySpaces Consulting Ltd.
24 July 2007
Page »
First time, moderate prospective homeowners are poorly served by
the private market, whether new build or resale. This is particularly
problematic for young families with children. Although individual
motivations vary, if young families are determined to purchase, they may
relocate elsewhere in the valley, postpone purchasing or make higher
interest borrowing arrangements. The primary government measure for
first time homeowners is the exemption from property purchase tax.
»
Fernie’s seasonal workers’ housing needs are generally met by the
private sector at this time. However, the quality of housing is known to
be variable and scarce during peak periods. The principal recreational
employer — Fernie Alpine Resort — does not provide seasonal workers
with access to housing at this time. With the growing shortage of younger
workers, however, workers may become more discriminating about where
they work and where they live. A number of destination resorts have
staff accommodation. For example, Sun Peaks Ski Corporation has onhill employee housing for $425 per month; Lake Louise offers employees
monthly rental from $200-$275; and Whistler Blackcomb has several staff
accommodation options ranging from $300 to $500 per month.
»
With respect to people with physical or mental disabilities on income
assistance, their incomes often restrict their ability to find suitable,
affordable housing in the private market. Tom Uphill Manor currently has
vacancies which are suited to people with certain types of disabilities.
The Provincial government and non-profit service providers continue to
monitor and respond to the housing needs of people with disabilities.
Housing Needs Recap:
»
Low income individuals and families, as well as people with disabilities
on income assistance have the least choice in the Fernie housing market.
We estimate there is currently an unmet need of between 30 and 40
units. This group should be considered as a top priority.
»
Active, mobile seniors with equity in their homes looking to move to
a smaller home/condo represent an opportunity worth exploring for a
private sector developer. With respect to supportive housing, additional
units will be needed as the population ages. Planning for another
supportive/assisted complex should begin within the next 3-5 years.
»
Prospective first-time homebuyers with one or more children with
$60,000 or less annual income have very little opportunity to purchase
in Fernie. If there is widespread sentiment to facilitate homeownership
for this group (as there appeared to be during the scoping period), this
would be one of the top priorities for a housing strategy.
»
Seasonal workers need wider and better choice in the market. As the
labour force ages it is likely to be increasingly important for employers
to know that their recruits have suitable affordable housing. This is
a market opportunity, possible for a developer to build staff-type
accommodation with secured rentals to major employers. Alternatively,
seasonal workers offer an opportunity for homeowners to create
secondary suites.
Fernie Housing Needs Assessment
CitySpaces Consulting Ltd.
24 July 2007
Page APPENDIX A
KEY FACTORS AFFECTING fernie’s housing market
This appendix describes a number of factors that affect housing markets, which draw
on a variety of data indicators. Some indicators apply only to Fernie, others cover a
broader geography. All indicators have been taken into account in assessing the need
for affordable and attainable housing in Fernie.
A1.
Demographic Indicators
As the following indicators show, Fernie’s permanent population will remain relatively
static but will age noticeably in the coming 20 years.
Population Change from 1996 to 2006
Between 1996 and 2001, Fernie’s population declined from 4,898 to 4,611, representing
a change of –5.9%. Between 2001 and 2006, Fernie’s population decreased again,
falling from 4,611 to 4,217 representing a change of –8.5%. The trend is consistent with
general population decline in Canada’s rural areas and the East Kootenay Region in
particular, which declined by 1.4% between 2001 and 2006.
Population Projections to 2031
Projections by the BC government indicate that growth will be negligible over the next
20 to 25 years in the Fernie Local Health Area, which includes Fernie, Sparwood and
Elkford. The population is projected to increase from 15,932 in 2006 to 16,297 in 2011,
reach a peak of 16,720 in 2021, and then recede to 16,215 in 2031. Examined on an
age-specific basis, as shown in Table 1, these forecasts indicate that:
•
•
•
•
•
The
The
The
The
The
0-14 age group will decline;
15-24 and 25-34 age groups will decline substantially;
35-44 age group will remain relatively stable;
45-54 and 55-64 age groups will decline somewhat; and
65-74 and 75+ age groups will increase significantly.
Fernie
Housing Needs
Assessment
Table 1: Population Projections by Age Group
2006
Total
15,932
0-14
2,449
% of
Total
2011
% of
Total
16,297
15%
2,105
2021
% of
Total
16,720
13%
2,233
2031
% of
Total
16,215
13%
1,896
Prepared for the
City of Fernie
12%
by CitySpaces
Consulting Ltd.
15-24
2,608
16%
2,225
14%
1,318
8%
1,441
9%
25-34
1,930
12%
2,566
16%
2,172
13%
1,334
8%
35-44
2,216
14%
1,726
11%
2,632
16%
2,210
14%
45-54
3,052
19%
2,923
18%
1,719
10%
2,596
16%
55-64
2,059
13%
2,646
16%
2,870
17%
1,686
10%
65-74
962
6%
1,312
8%
2,490
15%
2,688
17%
75+
656
4%
794
5%
1,286
8%
2,364
15
24 July 2007
Source: BC Stats
Appendix page A2.
Economic Indicators
As the following indicators show, Fernie’s economy has been diversifying with growth in
the service industry.
Regional Growth in the Recreation and Resort Property Market
In 2006, a report entitled “How Growth in the Recreation and Resort Property Market
is Driving Change in the East Kootenay Region” was released by the Real Estate
Foundation of BC. The report presents a number of key findings:
•
esort and recreation property development has had a significant influence
R
on shaping the regional landscape since 1989;
•
etween 1989 and 1996, median property prices more than doubled in the
B
region and Alberta purchasers participated in 60% of sales;
•
Between 1996 and 2000, property markets were relatively flat but in the
following five year period, prices again began to rise. After 2001, nonresidents purchased 62% of properties.
The authors identify positive impacts of this market demand as imported capital, tax
revenues, new property development and employment growth, and a downside being
“imported inflation of land values, causing the price of entry level properties to rise
disproportionately to local incomes.”
Labour Force
Fernie’s economy has historically been diverse, with its labour force employed in a
range of sectors including mining, forestry, manufacturing, retail, education, and
health. Between 1991 and 2001 there were notable decreases in the manufacturing and
utilities and science sectors (-55% and –32% respectively) and substantial increases in
the management and sales & service sectors (68% and 36% respectively).
In 2001, 14% of Fernie’s labour force was employed in the management sector; 28% in
sales and service; and 21% in the trades and transportation. These statistics support
the observation that Fernie is moving toward a service- and tourism-oriented economy.
Notably, Fernie’s labour force distribution is relatively consistent with that of the
province as a whole.
Tourism
Earlier this year, the Kootenay Rockies Tourism HR Strategy Steering Committee
commissioned a Tourism Labour Market Analysis for the Kootenay Rockies Region.
This was undertaken by Canbritic Consultants and published in May 2007. The overall
analysis is that tourism in the region will experience rapid employment growth and
experience labour shortages, particularly in the summer period. The following is
excerpted from this report:
•
“The dynamics of demographic change is going to reduce the potential
labour supply overthe next decade. The youth population, (those 15 to 24
years of age), which is the basicfeeder for new labour market entrants,
is projected to decline … The direct impact on the tourism industry is
Fernie
Housing Needs
Assessment
Prepared for the
City of Fernie
by CitySpaces
Consulting Ltd.
24 July 2007
Appendix page that there will be fewer workers for the less skilled, volume jobs, which
currently have a high proportion of workers between 15 and 24 years of
age.
•
A3.
“Tourism employment growth has been faster than the average for BC as a
whole ... This more rapid employment growth is expected to continue over
the next several years. Annual employment growth in core tourism jobs will
require about 600 new workers each year to 2010 and then 350 to 400 each
year to 2015.”
Income Indicators
The income indicators show that while a significant number of people are benefitting
from the region’s strengthening economy, others are in support sectors of the economy
where incomes are modest.
Representative Wages
Representative wages for typical jobs in Fernie include:
•
•
•
•
•
•
•
•
$8 - $10 per hour for most entry level hospitality and retail jobs;
$15 per hour for an office assistant;
$25 per hour for a cabinetmaker/woodworker;
$25 – 40.92/hour for a nurse employed by the Interior Health Authority;
$64,500 for a teacher in School District #5;
$40,000 for a secretary at Elk Valley Coal;
$60,000 -$80,000 for a truck driver at Elk Valley Coal; and
$100,000+ for a foreman at Elk Valley Coal.
Almost one third (28%) of Fernie’s labour force is employed in sales and service
occupations , yet service sector employees have the lowest incomes – in the $8 – $15
per hour range, corresponding to approximate annual incomes of $16,000 to $31,000.
Elk Valley Coal employees make significantly higher wages in comparison.
Fernie
Housing Needs
Assessment
Median Incomes
Couple families had higher incomes than the other household groups, offering them
greater choice in the housing market, while single parents and individuals not living
with other family members had lower incomes and relatively less choice in housing.
Prepared for the
City of Fernie
Table 2: Median Incomes by Family Type, 2005
Household Type
No. of Households
Median Income
1,340
$76,700
Lone Parent Families
240
$32,300
Non Family Persons
960
$20,900
Couple Families
Source: Statistics Canada
by CitySpaces
Consulting Ltd.
24 July 2007
Appendix page Distribution of Incomes
Table 3 illustrates which household types will have greater choice in the housing
market. In 2005, 52% of couple families made $75,000 or more, compared to just 12%
of lone parent families, and 4% of individuals. Overall, 70% of households earned less
than $75,000 and 58% of households earned less than $50,000.
Table 3: Income Distribution by Household Type, 2005
Income Group
Couple Families
Lone parent Families
Non Family Persons
< $25,000
7%
42%
57%
$25,000 - $50,000
20%
29%
27%
$50,000 - $75,000
21%
17%
11%
$75,000 - $100,000
21%
4%
4%
$100,000+
31%
8%
0%
Total
100%
100%
100%
Source: Statistics Canada
Table 4 shows the number of couple households with one or two children by income
group. In total, in 2005, there were 120 households with incomes of $60,000 or less.
Table 4: Couple Households with 1 and 2 Children, Income Distribution
2005
Annual Income
Number of Couples with 1 child
Number of Couples
with 2 children
<$40,000
30
20
$40-60
30
40
$60-80
50
50
$80-100
40
60
Fernie
$100+
110
120
Housing Needs
Source: Statistics Canada
Assessment
Households in “Core Need”
Canada Mortgage and Housing Corporation’s (CMHC) definition of housing need is “core
housing need”. Households are thought to be in core housing need if they are paying
more than 30% of pre-tax income for shelter, live in crowded conditions, and/or if they
live in a home in need of major repairs.
Prepared for the
City of Fernie
by CitySpaces
Consulting Ltd.
Table 5: Core Housing Need, Fernie 2001
All
Owned
Rented
Total
180
60
115
Senior Households
50
25
25
Family Households
70
35
90
Non-Family Households
60
15
40
24 July 2007
Appendix page % Of All Households in Fernie
Total
10%
5%
22%
Senior Households
13%
9%
25%
Family Households
7%
2%
23%
Non-Family Households
16%
9%
19%
Total
52
47
52
Senior Households
41
41
40
Family Households
57
57
63
Non-Family Households
48
no data
61
Average Shelter Cost to Income Ratio
Source: Canada Mortgage and Housing Corporation, Statistics Canada
A4.
Housing Indicators
A number of indicators are available that help describe the current housing situation in
Fernie. Some of these indicators were readily available, others were obtained through
a special data request of the compiling agencies.
Permanent Occupancy
An examination of occupancy levels shows that the proportion of private dwellings
occupied by usual residents declined from 82% (1,945 of 2,368 dwellings) in 2001
to 71% (1,876 of 2,627 dwellings) in 2006. In comparison, occupancy levels in the
East Kootenay Regional District declined slightly from 80% in 2001 to 79% in 2006. In
Electoral Area A, usual residents occupied 59% of all private dwellings in 2006.
Housing Ownership by Owner Origin
A significant percentage of properties within Fernie are locally-owned; however, Alberta
purchasers own an increasing percentage of local properties.
Table 6: Housing Ownership by Owner Origin
Owner’s Permanent Residence
Fernie
Housing Needs
# of Residential Properties
Assessment
2002
2004
2006
Fernie
1515
1535
1555
Prepared for the
Alberta
482
512
524
City of Fernie
BC
77
80
91
England
55
81
84
Ontario
50
52
52
USA
44
50
51
Saskatchewan
22
22
22
Source: BC Assessment Authority
by CitySpaces
Consulting Ltd.
24 July 2007
Appendix page There is a wide variation in locally owned and out of town owners among Fernie’s
neighbourhoods as is evident from the following table.
Table 7: Housing by Neighbourhood, Local Ownership
Neighbourhood
Number of
Dwelling Units
Locally Owned %
Annex
575
64.8%
Alpine/Parklands
157
42.0%
Castle Mountain
358
67.0%
Ghostrider
6
100.0%
Maintown
758
85.2%
Mountview
352
84.7%
Ridgemont
333
47.1%
Riverside
162
4.3%
Source: City of Fernie from BC Assessment Authority
Recent Sales Prices
Actual sale prices follow the MLS list prices fairly closely with the exception of single
detached dwellings in Fernie. Actual sales for the period of March 1, 2007 to May 31,
2007 reveal that:
•
In Fernie, there were 27 sales of single detached dwellings with a median
sale price of $344,560 and 10 sales of condominium/apartments with a
median sale price of $214,490.
•
In Sparwood, there were seven sales of single detached dwellings with a
median sale price of $305,633, six sales of condominium/apartments with
a median sale price of $105,150 and three sales of mobile homes with a
median sale price of $86,417.
•
In Elkford, there were 15 sales of single detached dwellings with a median
sale price of $212,727 and 11 sales of condominium/apartments with a
median sale price of $99,218.
Housing List Prices
Fernie
Housing Needs
Assessment
Prepared for the
City of Fernie
Between 2001 and 2006, Fernie’s ownership housing prices increased and remained
higher than the outlying communities of Sparwood and Elkford. However, prices in Sparwood and Elkford have also increased. This is shown in the accompanying table.
by CitySpaces
Consulting Ltd.
Table 8: Housing List Prices, by Community, May 2007
Fernie
Sparwood
Elkford
Detached
$574,000
$324,900
$229,950
Townhouse
$429,900
$107,400
—
Condo Apt
$279,250
$98,900
$95,000
24 July 2007
Source: Multiple Listing Service
Appendix page Rental Rates
A scan of Craig’s Fernie Listings during May 2007 indicates that there was a range of
available rental stock with varying rates.
Room/shared accommodation
One bedroom apartment
Two bedroom apartment
Detached home (3-4 bd)
•
•
•
•
$375
$500
$1,000
$1,200
Notably, much of Fernie’s rental stock is limited to rentals on a seasonal basis where
owners are able to obtain higher rates on a short-term basis during the winter. They
may also choose to rent their homes for a few months at a time during the summer
months. Generally, there is a greater supply of rental accommodation during summer.
Housing Starts
Despite Fernie’s declining population, construction of new housing stock has increased
since 1996, which coincides with the Fernie Alpine Resort expansion. Over a 10-year
period housing starts have resulted in 712 new dwellings from 1,915 dwellings in 1996
to 2,627 dwellings in 2006. The following table reveals that from 1998 to 2006, the
construction of multi-unit dwellings has outpaced that of single-detached dwellings.
Table 9: Residential Building Permits
Type
1998
1999
2000
2001
2002
2003
2004
2005
2006
Detached Dwelling
21
11
30
18
9
37
20
8
5
Row Dwelling
36
58
6
0
0
0
0
6
24
Apartment
0
8
86
4
13
18
38
104
33
Total
57
77
122
22
22
55
58
118
62
Source: BC Stats
Current Housing Inventory
An examination of the Fernie’s 2006 property tax roll shows that there are a variety of
housing types in Fernie ranging from single detached dwellings, to multiple dwelling
types, manufactured homes, and accessory suites. The following list shows a relatively
high proportion of single-detached dwellings in comparison to multiple family and other
dwelling types.
•
•
•
•
•
•
•
Detached homes1,524 (59% of all homes)
Duplex/Triplex/Fourplex
95
Strata Lot (condominium)
452
Multi-family apartments and row housing
281
Accessory suites
55
Manufactured homes143
Other
47
Fernie
Housing Needs
Assessment
Prepared for the
City of Fernie
by CitySpaces
Consulting Ltd.
24 July 2007
Appendix page 5.0
Housing Affordability Indicators
The relationship between housing prices/rents and incomes is a key measure to
describe housing affordability. Housing analysts use this relational measure for
establishing what constitutes housing that is affordable in a particular community for
various households types.
Maximum Affordable Monthly Spending on Housing
Table 10 shows the maximum affordable monthly housing cost for households earning
median income and spending no more than 32% of their income on housing. In terms
of both rental and ownership housing, couple families in general have a greater range
of housing choices than lone parent families or singles. Couple families earning the
median income have the ability to rent a dwelling at $2,045 whereas lone parent
families and singles earning median income are limited in terms of housing choice with
the ability to pay rents of $861 and $557 respectively.
Table 10: Amount Available for Housing
2005 Median
Income
Maximum Affordable
Monthly on Housing @
32% of Median Income
Couple Families
$76,700
$2,045
Lone Parent Families
$32,300
$861
Non-families (age 15+)
$20,900
$557
Household Type
Sources: Statistics Canada; CitySpaces calculations.
Table 11 shows the maximum purchase price a lending institution is likely to set for
households at various incomes and with varying down payments if they are to consider
mortgage funding. We have used a conventional approach for these calculations — a
three-year closed mortgage term with a posted rate of 6.29% and an amortization of
25 years. (Note: these are approximate calculations only; individual circumstances
vary and will affect the maximum purchase price. The calculations take into account
property taxes, heat and mortgage insurance but do not take into account potential
monthly strata fees.)
Table 11: Maximum Purchase Price by Household Type
0% Down Payment
10% Down
Payment
20% Down
Payment
$45,000
$103,318
$116,035
$133,150
$60,000
$162,360
$182,345
$209,238
$76,700
$228,000
$256,165
$293,950
$90,000
$256,300
$287,850
$330,300
$105,000
$310,255
$348,445
$399,841
Notes:
Fernie
Housing Needs
Assessment
Prepared for the
City of Fernie
by CitySpaces
Consulting Ltd.
Median income
couple family 2005
24 July 2007
Source: Census of Canada, 2001; CitySpaces calculations using Canadian Bank Online Mortgage Calculator
Appendix page Comparing Fernie’s housing prices and residents’ ability to purchase housing at today’s
rates and terms, we make the following observations:
•
A couple household earning the median income ($76,700) with 10% down
payment can afford to purchase a home of approximately $256,000. This
couple could afford to purchase a condominium ($214,000) but could not
afford a detached home in today’s market ($344,000).
•
A household earning $60,000 could not afford to purchase either a
detached home or a condominium in today’s market.
Comparing Fernie’s rents and residents’ ability to rent housing in today’s rental market,
we make the following observations:
•
A couple household earning the median income ($76,700) can afford to rent
at approximately $2,000 per month. Homes are available for rent in Fernie
in the $1,200 - $1,400 rental range, plus utilities.
•
A lone parent family at the median income ($32,300) can afford to rent in
the range of $850 per month. Two bedroom apartments rent in the range of
$1,000 per month.
•
A single person at the median income ($20,900) has about $550 to pay for
housing. One-bedroom apartment rentals in the summer may be affordable
for a single person making the median income, but it is likely this person
will need to double-up or rent a room during the winter.
A6.
Government/Non-Profit Housing Inventory
Local service providers including Fernie Citizens Housing Society, Fernie Family Housing
Society, Elk Valley Society for Community Living, Fernie Womens’ Resource Centre have
demonstrated ability in providing housing services to Fernie’s vulnerable populations.
Over 100 units of housing geared toward vulnerable populations have been developed
including:
•
37 units in Trinity Lodge (Fernie Citizens Housing Society, City Council
is the Board of this society);
•
32 units in New Horizon Village (Fernie Family Housing Society (FFHS);
•
27 units in Tom Uphill Manor (FFHS); and
•
10 units in Chrysalis House (FFHS).
Additionally, Rocky Mountain Village contains 75 units of supportive housing, assisted
living, and residential care housing (a private development by Golden Life Management
operated in partnership with Interior Health and BC Housing).
Trinity Lodge provides independent living facilities for seniors in mostly one-bedroom
units. There are currently ten names on the wait list for Trinity Lodge, indicating that
there is a demand for independent seniors housing. One of the respondents noted that
it took more than a year for one senior to obtain housing in Trinity Lodge.
•
Fernie
Housing Needs
Assessment
Prepared for the
City of Fernie
by CitySpaces
Consulting Ltd.
24 July 2007
New Horizon Village is a social housing development for families, seniors
and people with disabilities. The Fernie Family Housing Society has
Appendix page indicated that there are currently (as of May 2007) 74 applications on file
for individuals and families who are seeking housing. The average wait time
for people on the wait list is approximately one to two years depending on
an assessment of need (based on income, current housing, personal and
health status).
•
Tom Uphill Manor, a 27-unit supportive living development for seniors and
people living with disabilities, currently has five vacancies. This may be an
indication that there is less need for assisted living than for independent
seniors’ living facilities. However, the vacancies may also be related to
accommodation costs.
•
Rocky Mountain Village attempts to satisfy demand for a range of seniors’
needs through supportive housing, assisted living, and residential care.
The facility operates in partnership with Interior Health and BC Housing
and contains 12 units of supportive housing, 12 units of assisted living
(partial nursing care), and 51 units of residential care (complete nursing
care). Residents in assisted living and residential care may be eligible for
housing subsidies. Supportive housing units are rented at $1,750/month
for a one-bedroom unit and $1950/month for a two-bedroom unit. There
is an additional charge of $380 for each additional person in a unit. Seven
meals are provided each week. There are six people on the waiting list for
supportive housing. Wait times vary but it can take more than a year to
access supportive housing.
A7
City of Fernie — Existing Measures
The City’s Official Community Plan (OCP), zoning bylaw, and regulations regarding
strata units provided a framework for residential development. There are several
positive aspects to these measures, providing a good starting point for further
consideration of measures to take in support of affordable and attainable housing.
Specifically, these include:
•
OCP statements ... “encourage a spectrum of residential dwelling types,
locations and densities to accommodate different socio-economic groups,
age groups, and lifestyles” ... “promote secondary suites”;
•
The zoning bylaw includes definitions for secondary suites, secondary
dwellings, accessory dwellings and employee housing and allows for these
in a number of residential and mixed-use zones. The zoning bylaw also
contains zones for manufactured and mobile homes (Note: The take-up on
suites has been limited by requirements of the zoning bylaw and the BC
Building Code); and
•
Fernie
Housing Needs
Assessment
Prepared for the
City of Fernie
by CitySpaces
Consulting Ltd.
There is a moratorium on the stratification of existing rental housing, in the
interests of retaining as much affordable rental housing as possible. (Note:
This is a controversial measure with some landlords.)
Beyond its policy and regulatory framework, the City of Fernie owns a number of
land parcels of varying size that are dispersed throughout the community. In 2005, a
development constraint assessment for specific City-owned parcels was undertaken.
Although cumulatively the total area of land parcels is substantial, there are a number
of challenges with developing most of the land. Challenges include soil contamination,
24 July 2007
Appendix page 10
steep slopes, floodplains, and the need to upgrade or install services (i.e., water,
sewer, storm, hydro, and gas) to accommodate development. Particular parcels of
interest include:
•
Land in Parkland Terrace adjacent to Bossio Road and the Elk River;
•
Land in proximity to the CPR right-of-way south of New Horizon Village;
•
Two 60’ x 120’ lots in Maintown located at 3rd Avenue and 4th Street.
•
Land in the Mountview Neighbourhood proximate to Max Turyk School;
•
Large land parcels along Coal Creek Road east of Ridgemont and Pinegrove;
•
Residentially zoned land in the Annex adjacent to 12th Avenue, 17th Street
and the Elk River; and
•
A commercially zoned lot on 1st Avenue in Maintown is currently a gravel
parking lot.
Despite the inherent challenges, some possibilities exist for affordable housing
development on City-owned lands. The sites that appear to present the greatest
potential (due to few physical constraints) include the Parkland Terrace site and
the C1 site in Maintown. Alternatively, there is potential to sell City-owned lands
with a portion of the proceeds to be set aside in a Reserve Fund for future housing
development. These opportunities will be explored further through the development
of the strategy, which will include recommendations for the future use of City-owned
lands.
Fernie
Housing Needs
Assessment
Prepared for the
City of Fernie
by CitySpaces
Consulting Ltd.
24 July 2007
Appendix page 11
Appendix C
Affordable Homeownership Examples
Appendix C
Affordable Home Ownership Examples
Models of affordable home ownership have been delivered across Canada and the United States
to reach a segment of the population unable to secure homeownership in the open market. Such
projects provide affordable home ownership units where: a) the purchase price and monthly
costs associated with occupancy are below that of the price on the local housing market for a
similar unit; and b) the monthly occupancy related costs (mortgage, strata fees, property taxes,
insurance, utilities, maintenance and repairs) are equal to or less than current overhead of
comparable accommodation in the market rental sector.
Affordable home ownership has many benefits for the homeowner and broader community,
including among other benefits:
•
Security of tenure;
•
Ability to build equity;
•
Increased savings and investment behaviour;
•
Community and social stability; and
•
An increase in supply of rental housing.
Examples from Mountain Resorts in Canada and the USA
Employee Housing — Whistler Housing Authority (Whistler, BC)
Whistler employees are eligible to register for the purchase of a home through the Whistler
Housing Authority (WHA) if they have been employed for 12 months in Whistler. Applicants are
required to be pre-approved for a mortgage that corresponds to the price range and type of unit
they are interested in purchasing.
•
The WHA has an inventory of condominiums, townhouses, and single detached dwellings
available for purchase. The tenure (Whistler employees only) and price are restricted through
a housing agreement with the Resort Municipality of Whistler.
•
A multiplier formula is used to determine resale prices and maintain them at prices of
restricted units to those comparable to other parts of the region.
Mixed Equity Co-op — Mountain Haven Coop (Canmore, Alberta)
The Mountain Haven Co-operative located in Canmore has developed an affordable housing project
based on a mixed equity co-operative model. On a non-profit basis, the Co-op has constructed 43
stacked townhouse units, including 17 rental units and 26 mixed equity co-operative units.
•
Prospective owners/co-operative members must have an annual household income that is
within the income cap of $66,800. Co-operative members must qualify for an individual
mortgage in order to purchase a home at a price range of $137,000 to $207,000.
•
The mixed equity units consist of 40% continuing and 60% limited equity home ownership. Over
time, co-operative members can build equity in their home. The co-operative also aims to
maintain the 60%/40% distribution over time by repurchasing units as required to maintain that
balance.
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
Appendix C - With respect to resale, the co-operative registers title covenants restricting occupancy and resale.
The restriction on resale price is limited to 110% of inflation measured by CPI.
Whitefish Housing Authority (Whitefish, Montana)
The Whitefish Housing Authority (WHA) has been operating for 40 years, with a primary focus
on affordable rental housing. In recent years, the authority has become involved in affordable
homeownership. In 2006, the authority aided eight households to purchase homes. Due to
the soaring cost of housing in Whitefish, the WHA established a goal to increase the supply of
affordable housing by 10 homes annually. The homes are purchased by first time homebuyers and
they must meet certain income guidelines, have good credit and take a homebuyer education
class. WHA provides down payment assistance which is later repaid by the homeowners and the
proceeds utilized for other new first time homebuyers.
Housing Trust, Park City Utah
Mountainlands Community Housing Trust (MCHT) is a non-profit corporation located in Park City,
Utah. Park City and area has become extremely expensive for local residents and seasonal workers
as the multi-mountain resort has grown, particularly following the 2002 Winter Olympics.
Founded in 1993, MCHT is based on the belief that a safe affordable home is often a family’s first
step toward economic self-sufficiency. MCHT addresses the dual problems of housing affordability
and availability on three fronts: acquisition and new construction of affordable housing, direct
assistance in securing housing and needed basic services, and education and advocacy to promote
housing policy. MCHT manages a growing portfolio of resale restricted homes, seasonal housing
and affordable rental housing. One of the most valuable roles the organization carries out is as a
central source of affordable housing inventory — http://www.housinghelp.org/housing/housing.cgi
Jackson Hole Community Housing Trust (Jackson Hole, Wyoming)
Housing costs in Jackson Hole are beyond the reach of many of the area’s workforce. The Jackson
Hole Community Housing Trust responds to this need by subsidizing the development of deed
restricted housing for the families and individuals who contribute to and diversify their populace.
The residents served by the Housing Trust would not be able to remain a part of the community
without this arrangement. East Kelly Avenue Housing is an example of a national award-winning
project for affordability and environmental design. The project consists of detached, fourplex and
duplex homes with a 99 year land lease in the centre of an established residential neighbourhood.
All the units are of modular construction. To be eligible to purchase these homes, residents must
work in the area and have an income no more than 120% of AMI.
Boulder, Colorado
The City of Boulder has a 40-year history of making affordable housing a reality and is approaching
its goal of setting aside 10 percent of local housing as “permanently affordable” (approximately
4,500 homes). In 2007, the median price for a detached home in Boulder is $540,000 and $242,000
for a townhouse condominium. In 1980, the City began to enter into contracts with developers,
requiring the inclusion of modest-sized units in new developments that could only be sold to
buyers of low and moderate incomes. Since then the Incusionary Zoning program has evolved with
a cap on resale prices and on the income of would-be buyers. Developers can opt for cash-in-lieu
which, on average, range from $100-$150,000 per required affordable unit.
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
Appendix C - Other Examples
Habitat for Humanity (Canada-wide)
Habitat for Humanity Canada is a national non-profit organization that mobilizes volunteers and
community partners in building affordable housing and promoting home ownership as a means to
breaking the cycle of poverty.
•
Habitat builds modest homes with simple yet effective designs, reduced building costs through
the use of skilled and unskilled volunteer teams, and building material donations by private
sector sponsors. Typically, the affordable housing units are sold at 10% below market prices,
much of which can be attributed to the donations of time and material.
•
Families are provided with a first mortgage based on construction costs at a zero interest rate,
and a second mortgage based on market value (difference between market value and first
mortgage). Second mortgages are forgiven after 12 years of residence.
•
Habitat has also developed a revolving fund in which the mortgage payments made by families
are used as a source of capital to build new homes for other families in need. The revolving
fund is now used primarily for multi-family dwellings due to increasing land costs across the
country, while historically single detached units were the norm.
Reduced Land Costs (Simon Fraser University, Burnaby)
Targeting Simon Fraser University faculty and staff, The Verdant is a 60 unit strata-titled stacked
townhouse in Burnaby Mountain that provides affordable homeownership units at 15% to 20% below
those of comparable market housing in Burnaby.
•
The recently completed project is based on a partnership between SFU Community Trust,
VanCity Enterprises and ReSource Rethinking Building Inc. SFU provided the land at a
discounted price (50% of market value) and committed to buy back 20 units to be managed by
the university as rental housing for staff and faculty.
•
To further reduce project costs, ReSource Rethinking Building provided development
management services on a fixed fee basis, and lower marketing costs were achieved by using a
direct marketing approach.
•
With a reduced cost base overall, debt servicing costs were inherently reduced. VanCity also
provided innovative financing in the form of preferential mortgage terms with low interest
rates and longer amortization rates. Home ownership equity was based on a fixed return
option.
•
The long term affordability of the project is ensured by restrictive covenant to control resale
and thereby limit price appreciation relative to that of adjacent developments.
Mortgage Financing Innovation (Vancouver, BC)
Vancity offers a number of financing options to provide flexibility and opportunity for new home
owners in the “hot” real estate market of Vancouver.
•
Mixer Mortgage — a new approach to traditional home buying designed for multiple households
who partner up to purchase a home. The new owners/partners can share the down payment,
mortgage payments and other ownership expenses. While each party’s name appears on the
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
Appendix C - title for the property, the owners have the flexibility to decide how the costs are divided
among the partners.
•
Springboard Financing — Designed for households moving out of subsidized rental housing,
this financing model consists of a down payment loan of 20% of principal, to be paid (principal
only) over 10 years; and an interest only payment on 80% of the value, also over 10 years
(amortized for 25). At the end of 10 years, the mortgage converts to a traditional mortgage.
Inclusionary Zoning for Affordable Housing (City of Langford, BC)
In March 2004, the City of Langford on Vancouver Island adopted an affordable housing policy to
deliver affordable single detached dwellings in new subdivisions through an inclusionary zoning
bylaw using the density bonusing provisions of the Local Government Act.
•
The City requires all rezoning applications of 10 or more “single residential” lots to include
small lots. For each group of 10 single detached lots, the development is required to provide
one affordable housing unit.
•
Council may agree to allow one or more affordable housing units to be provided on a site
different than that being developed, subject to the location being confirmed prior to approval
of the bylaw.
•
An affordable housing agreement is signed between the developer and the City of Langford to
restrict the maximum sale price to $150,000 and to qualified purchasers.
•
The City’s Affordable Housing Committee reviews the applications of prospective purchasers
to determine eligibility and need. The Committee controls the transfer or resale of affordable
homes for a period of five years and selects subsequent purchasers. After the first five years,
the owner is permitted to increase the sale price by $2,000 for each year of the ownership
period.
Reduced Downpayment and Monthly Subsidy (Medicine Hat, Alberta)
In Medicine Hat, a growing city of approximately 57,000, the city’s largest local builder — Classic
Construction Limited — developed an innovative solution to create affordable homeownership
opportunities. In partnership with the City of Medicine Hat and CMHC, Classic Construction has
facilitated the construction of approximately 400 townhomes in three projects since 2005 through
assisting purchasers of new below-market housing units. Each purchaser receives an equity subsidy
of approximately $5,000 that reduces the downpayment and also receives a monthly subsidy for
five or seven years to reduce mortgage costs, condominium fees and utilities. Classic Construction
contributes approximately $18,000 per unit to cover the monthly subsidy. This subsidy is gradually
decreased over the five or seven years, allowing homeowners to adjust to making the monthly
payments independently at the end of the subsidy period. The Medicine Hat Community Housing
Society provides homeowner training to potential buyers and administers the monthly mortgage
subsidy. CMHC provides mortgage loan insurance flexibilities to homebuyers. The City of Medicine
Hat assisted through relaxed zoning requirements for density, greenspace and site coverage.
Not-for-profit Condo Model — Clarence Gate Project (Ottawa, Ontario)
Centretown Affordable Housing Development Corporation (CAHDCO) develops projects based on an
affordable home ownership model that ensures long term affordability by controlling the terms of
resale and leasing. A recent example was implemented with the 30-unit Clarence Gate Project.
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
Appendix C - •
The key to the project’s affordability is modest design and low profit. One-third of the units
were sold at market prices to provide a capital subsidy to the affordable units.
•
This not-for-profit condo model is a tenure arrangement designed to balance the need for
the sponsor (CAHDCO) to retain control of resale and ensure long term affordability, and the
homeowner’s need to protect his or her equity. Purchasers are required to sign an option that
gives CAHDCO the opportunity to buy back the unit. Owners receive their full purchase price
plus inflation (determined by CPI), plus a 3% charge for administration and resale.
•
Owners are required to consult with CAHDCO in the event that the unit is to be rented. The
approval to lease cannot be unreasonably withheld; however, the duration of the lease may be
no more than one year, and the rent charged must meet the affordability criteria.
•
Purchasers pay the financing costs, taxes, utilities and a monthly fee for a share of common
expenses. CAHDCO also negotiated with the City to ensure property taxes reflect the
controlled value of the home as opposed to the higher market price.
•
Most of the parking spaces are rented out by the condominium to the unit owners. This
revenue helps to reduce common cost expenses.
Second Mortgage Financing — Options for Homes (Toronto, Ontario)
Launched in 1992, Options for Homes is a non-profit agency targeting lower income households
currently renting their homes, those who have limited opportunities to buy into the current
market, and those who are not familiar with the principles of home ownership. The model brings
low and moderate income people into the condominium market through lowering project costs and
second mortgage financing.
•
The non-profit finds residential land and pre-sells the condo units. The buyers form a cooperative housing corporation, which then hires Options as the development consultant to
provide the expertise to develop the project. This includes finding contractors, architects and
lawyers, providing marketing and arranging financing. A small percentage of the purchase price
goes toward fees to pay administrative costs.
•
The condos are sold at scheduled information sessions. The purchase “consultants” who assist
buyers are not real estate agents, but for the most part, owners from other Options’ projects
working part time for a small flat fee. Real estate agent fees are thereby eliminated.
•
A second mortgage representing the difference between the building costs and market value is
set up. This second mortgage, however, lies dormant until the owner either sells the property
or rents it, thereby deterring speculators. For example, a condo unit valued at $110,000 on
the market is sold at the cost price of $100,000. The down payment is taken off the cost price
($100,000), leaving the buyer with a mortgage of $94,500, $10,000 less than they would have
had to pay at full market price. As the condos appreciate, so does the second mortgage, an
amount buyers must repay if they rent or resell. This money then goes into an equity pool that
is used to develop other similar projects.
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
Appendix C - Selected References
Canadian Housing and Renewal Association. Webforum, 2005. Exploring Viable Models for
Affordable Home Ownership.
Canada Mortgage and Housing Corporation.
Medicine Hat: Bernadette Majdell, 403-515-3056, bmajdell@cmhc-schl.gc.ca
Habitat for Humanity Canada. October 2003.
Affordable Homeownership: Background Discussion Paper.
Kraus, D., Eberle, M., and Pomerleau, J. 1999. Affordable Housing Solutions: Fifteen Successful
Projects. Canada Mortgage and Housing Corporation. Research Report.
ReSource Rethinking Building Inc. March 2006. Towards a Working Model of Affordable
Homeownership.
Centretown Affordable Housing Development Corporation: http://www.cahdco.ca/
Options for Homes: http://www.optionsforhomes.ca
Whistler Housing Authority: http://www.whistlerhousing.ca
Fernie Affordable and Attainable Housing Strategy
CitySpaces Consulting Ltd.
Appendix C - VICTORIA OFFICE
5th Floor, 844 Courtney Street
Victoria BC V8W 1C4
VANCOUVER OFFICE
Suite 910, 688 West Hastings Street
Vancouver BC V6B 1P1
250.383.0304 tel
250.383.7273 fax
604.687.2281 tel
604.687.2241 fax
866.383.0304 toll free
www.cityspaces.ca