BC government creates $500 million fund to buy affordable rental buildings

BC government creates $500 million fund to buy affordable rental housing buildings

Post 83 Housing Co-operative at 4221 Mayberry Street, Burnaby. It was jointly acquired by BC Housing and the City of Burnaby in 2022 to preserve their use as affordable housing. (Google Maps)

The provincial government has created a new pre-emptive strategy, backed with funding, to preserve affordable rental buildings and ownership co-operatives from speculative acquisitions.

The $500-million Rental Protection Fund will provide one-time grants to non-profit housing organizations towards acquiring such buildings listed for sale. This would help protect existing tenants and lengthen the duration of such units as lower-cost rental homes.

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Many of these properties are older rental housing buildings, which have lower market rents on average due to their age and condition. Increasingly, such buildings are acquired by developers, speculators, and real estate investment trusts as long-term, for-profit investments, which may result in renovictions and steep post-renovation rent hikes or redevelopments.

The new grant funding for such purposes is intended to be combined with non-profit organizations securing private financing to help fund their acquisition, along with rental revenue to cover financing and building operations costs.

However, the provincial government has decided that the management of the fund will be made by a separate entity, the Housing Protection Fund Society, comprised of the BC Non-Profit Housing Association (BCNPHA), Co-operative Housing Federation BC (CHFBC), and the Aboriginal Housing Management Association (AHMA). It is anticipated the fund will protect thousands of rental homes considered affordable.

“This fund will allow non-profits to secure older rental buildings and protect vulnerable renters from speculators who can drive up rents and evict tenants who have lived there for years,” said Premier David Eby in a statement.

“Instead, community non-profits will now be able to work with tenants to make improvements or expand to house more people, and at the same time protect affordable housing.”

Ravi Kahlon, the new BC Minister of Housing, added: “It’s not acceptable for speculators to be pushing renters out of their homes. By protecting more affordable housing, more people can stay in their homes and build a good life in BC.”

The Rental Protection Fund is one of a handful of major affordable housing measures since Eby’s inauguration as premier last November. More policy measures are expected to be announced this year and possibly in this year’s budget expected in February.

In the past, the provincial government has provided funding to acquire and protect rental homes with low-end-of-market rates. In 2022, through BC Housing, the provincial government partnered with the City of Burnaby to acquire three early-1980s towers in the Metrotown area with 425 co-op homes. BC Housing contributed $132.6 million, including $22.5 million for renovations and closing costs.

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