Provincial and federal budgets promise affordable housing for Vancouver, but at what cost?

The federal and provincial budgets recently earmarked money for affordable housing and, with the housing crisis at unprecedented heights in Vancouver, the city hopes the funds will help get costs under control.

The province recently broke ground on a mixed-income affordable housing project of 230 new rental units in the Fairview neighbourhood, following promises in the budget to spend $6 billion on affordable housing andbuild 14,000 affordable units.

The federal government also has a national housing strategy that has committed $40 billion over 10 years and aims to build 100,000 housing units across the country.

Dan Garrison, assistant director of housing policy with the City of Vancouver, says the two budgets align with the direction the city is heading and with the projects already planned for 72,000 new affordable units.

"The City of Vancouver is really well positioned to get an appropriate chunk of that [affordable housing funding]," he told Stephen Quinn, host of CBC's The Early Edition.

With all the talk about affordable rentals though, it's not always clear just how much "affordable" costs.

An expensive 'affordable'

The City of Vancouver has a guideline that says if developers create rental units below a certain price, they don't have to pay the city's development cost levy essentially, if the developers are willing to create more affordable rental units, they get a financial break.

In January, the city updated its guidelines for developers. For-profit affordable rental housing is now defined as between $1,730 and$1,903 for a one-bedroom rental and between $2,505 and $2,756 for a two-bedroom rental.

"There has been a lot of criticism of those rates as being unaffordable to folks," Garrison said. "Right off, we need to acknowledge that we know those rates are not affordable to a large proportion of households."

The challenge, he said, is setting a definition of affordable in order to comply with provincial legislation and to provideincentives to build units that can be turned into rentals.

Protecting rental stock

"We have to set those rates in a way that allows those projects to be delivered, otherwise we don't get any rental supply, we are left with just condominiums," Garrison said.

He says measures in the budgets to address speculative investment, provisions for rental-only zoning and further rental incentives for developments that target those with moderate incomes (between $30,000 and$80,000 per year) will make a difference.

"We are going to be able to get a lot further on that with the provincial and federal governments back at the table than we would have been if the city was trying to do this on our own," Garrison said.

With files from The Early Edition.