23,000 new homes to be built in HRM but not one ‘affordable’ unit

So the province has just announced it is taking over building nine housing areas in HRM – and basically freezing out HRM Council. The province is taking the responsibility for the building applications, permits, processing and more from HRM council and staff. The province’s minister of housing, John Lohr, plans to “fast track” the building of 22,450 housing units in 8 areas of HRM. The ninth area, Indigo Shore, has got the green light to develop 150 building sites, which could mean anywhere north of 1,000 more units.
The nine special planning areas are:
— former Penhorn Mall lands, 950 units- Crombie REIT and Clayton Developments
— Southdale/Mount Hope, 1,200 units- Clayton Developments
— Bedford West 10, 1,300 units – Clayton Developments
— Bedford West 1 and 12, 2,500 units – Clayton Developments
— Port Wallace, up to 4,900 units -Clayton Developments
— Indigo Shores, 150 building lots -ARMCO Capital Inc
— Morris Lake expansion, 3,100 units – Clayton Developments
— Dartmouth Crossing, 2,500 units- North American Developments Group
— Sandy Lake, 6,000 units -Clayton Developments

“We have here 22,600 units being announced and the total number of them … designated as guaranteed affordable is zero.”

Gary Burrill, MLA and leader of NS NDP

Are there any of the 22,000 plus units designated “affordable”? Not according to NDP leader Gary Burrill who said, “We have here 22,600 units being announced and the total number of them that is designated as guaranteed affordable is zero. That’s pretty disappointing. … We have lots and lots of units being built all over the city. At the same time, we don’t have any that are actually in scope or proportion of what people can afford.”
Liberal housing critic Lorelei Nicoll was also annoyed there is no provision for affordable housing.

What, in fact, does ‘affordable’ even mean? CMHC’s (Canada Mortgage and Housing Corporation) definition reads, “housing is considered ‘affordable’ if it costs less than 30% of a household’s before-tax income.”

Define ‘affordable’ housing

How does ‘affordable’ work when the median gross income for a family in NS was $55,900 in 2016? $55,900 is 87% of the Canadian average. Can those families afford the apartments, condos, townhouses or row housing in these new developments? Let’s see, 30% of $55,900 works out to $1,397 per month. Something tells me rent or mortgage payments for family accommodation in these new developments will exceed $1400 a month.

Below: Clockwise from top: Adele Martell and her two sons at home in Dartmouth. Several days after the ban on renovictions (due to Covid) lapsed on Mar. 21, she got notice she was being renovicted. Read more here; Credit: Adele Martell; modular homes in Dartmouth (credit halifax.ca); modern single family homes, built by Clayton Developments, from their website; sticker could be slapped on all vacant government property in HRM; duplexes in Ocean Breeze in Dartmouth.

CBC-TV’s Fifth Estate, Priced Out: Canada’s Rental Crisis was hosted by Halifax journalist Shaina Luck, you can watch it here. The program focused on a Dartmouth family of four. John and Stacey Smith, in their late forties, had been renting a 3-bedroom duplex in Dartmouth for ten years. The monthly rent was $751. In November 2021, the landlord said he wanted them out so he could move in. That set the Smiths on a race to find another affordable home for themselves and their two teenage children. Though both parents work, they don’t earn high salaries. After much searching and worrying, the family found another home, a virtual twin of the first one, but it cost them $1750 in rent—a 133% increase from the rent at the first townhouse.

In February 2022, according to Canadian real estate site WOWA, Canadian home prices had risen 20% since Feb. 2021; the average home sold for more than $800,000. You may be wondering about the cost to build a new house. In major Canadian cities the cost ranges between $70 and $200 per square foot. In Halifax, the cost of construction goes from $90 to $150 per square foot for a detached home. That means the average new-build 1500 square foot suburban home – in one of these nine new areas is likely to cost $150,000 plus to build. Yet it will cost five times more to buy.

“Every time borrowing costs fall, the earnings of home ownership go up.”

Joel Roberts in The Conversation

Nova Scotia’s Houston government believes that the more housing stock there is, the less houses will cost. This is another example of trickle-down economics, much favoured by Conservative governments across the country. But experts say that high house prices are not due to supply shortages. “The COVID-19 pandemic should have made this clear,” writes Joel Roberts, in The Conversation. Roberts is a PhD candidate in Social and Political Thought at York University in Toronto. “Despite the slowest population growth since the First World War, and the most number of houses built in more than a decade, prices went up 27 per cent.” Indeed, the low-cost of borrowing (below the cost of inflation) is a major driver of high house prices. As Roberts notes, “Every time borrowing costs fall, the earnings of home ownership go up.

Writes Roberts, “The result is predictable: buyers bid up prices and take on more debt. The same logic applies to incentives for first-time buyers. By lowering the cost of ownership, these policies contribute to the very problem they’re trying to solve: higher house prices.”
Roberts also notes that politicians notice that more and more of their constituents now rely on houses to finance their children’s university tuition fees and to provide a nestegg for their own retirement– as more than 47% of Canadians have no pension from their employers. Especially younger people who work in the gig-economy have no pensions.

High house prices are not due to housing shortages

Ipek Tueli, Associate Professor of Architecture and Canada Research Chair at McGill University agrees, “… the housing crisis will not be solved by building more of the same like condos and suburban homes for single families. But alternatives to housing-as-commodity could offer a partial solution to the bubble, and housing inequality more broadly.”

If we look at the list of developers for HRM’s nine areas, we see things some of us did not know. Clayton Inc turns out to be the big winner here. It’s going to build 80% of the new units; it’s the largest home builder in the province; Clayton’s parent company is Shaw Group Ltd which typically builds single-family homes in suburbs. Another thing to note is that Armco’s Indigo development in Middle Sackville was not given the go ahead by HRM Council. But now minister Lohr has given Armco the green light to build. The reason HRM Council denied it was because the development would have added a huge number of people to the neighbourhood. The children would have swamped some schools in Middle Sackville, notably Sackville Heights Elementary School –according to HRM Councillor Lisa Blackburn who opposed Armco’s bid.

Though Mayor Savage says he favours the province’s housing initiative, one wonders if that’s what he really thinks. Former ex-Liberal cabinet minister Geoff MacLellan headed the 5 person task force on housing that premier Tim Houston set up in November 2021. The task force was designed to get developers moving on home-building in HRM.

What about green space, what about transit?

What’s the hurry? According to Tim Outhit HRM Councillor for Bedford-Wentworth, “There was the idea that HRM was taking too long [to okay developments], and yes, developers do have the ear of the provincial government”. But Outhit warns that normally there would be public hearings, and the impact on the regional plan reviewed. There would have been one or two years just to negotiate before building – but now the building is to go ahead in a year or a little more. And will there be the trades people and the construction materials to do the jobs? Will there be consultation with HRM on it? What happens to the provision of green space, considerations for transit and more? Outhit notes, “I look outside and across the street to my neighbours. Most have 2, 3 cars in their driveways – that’s because there are no buses close by me.”

Many suburban homes have little access to public transport. (credit, Reddit.com)

Tim Outhit is happy that the province has given HRM the planning tool of inclusionary zoning to help address the affordable housing issue – but he notes it could be six months to a year before the regulations are drafted to put it into place. In the meantime, inclusionary zoning does not affect the tens of thousands of new homes planned for the nine areas.

The task force neatly sidestepped the HRM’s efforts – and now this is what we are left with. And indeed we are left with it, as final approval for each development agreement will probably rest with Lohr and the province, not with HRM council.

Can anyone tell me where HRM’s suburban councillors stand in all of this? I haven’t heard a peep from them.

Will this new housing plan for more than 23,000 units help solve our housing problem for families in the lower income range, for the disabled, and for the hard to house? I doubt it.

Featured Image: The Spider by Louise Bourgeois (Born in France, 1911, died in US 2010). On display in a 2017-18 exhibit called Women House which explored the relationship between women and home, at the Monnaie de Paris. To read more, see this article.

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