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New Tool Aims to Keep Low-cost Indigenous Housing Available

Association wants to see providers make best choices to stay open and debt free.

By Katie Hyslop 1 Dec 2016 | TheTyee.ca

Katie Hyslop reports on affordable housing for the Housing Fix. Follow her on Twitter @kehyslop.

2016-17 funders of the Housing Fix are Vancity Credit Union, Catherine Donnelly Foundation and the Real Estate Foundation of B.C., in collaboration with Columbia Institute. Funders of special solutions reporting projects neither influence nor endorse the particular content of our reporting. Other publications wishing to publish this article or other Housing Fix articles, please contact solutions editor Chris Wood here.

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Many non-profit housing supporters will soon lose federal subsidies. A new tool could help them brace for the impact.

It’s never easy providing non-profit housing, and it’s going to get even tougher for many providers as Ottawa withdraws long-standing subsidies. For some, the loss of support is still a ways off — for others, it’s already happening.

“Housing providers are used to doing the same business for the last 20 to 25 years,” said Nizar Laarif, business manager for the Aboriginal Housing Management Association (AHMA), an umbrella organization for 42 off-reserve Indigenous housing providers in British Columbia.

“At the end of the year, whatever deficit they had, the subsidy would cover that. So all they had to worry about was going with what you had in your budget, which is a relatively easy task.”

But that easy task has been complicated by the planned phase-out of federal subsidies for non-profit housing — subsidies that support about two-thirds of AHMAf’s members’ housing units in B.C., as well as tens of thousands of other non-profit housing units across the country.

Those units are occupied by some of Canada’s most vulnerable citizens. Some have lost their subsidies already; all will do so over the next three decades.

Across Canada there are currently some 10,500 units of subsidized off-reserve housing, of which 1,700, according to CMHC, are supported only by federal subsidies provided over the decades. Some others also receive support from their provinces.

“The easiest and most obvious solution is to keep running the business they’re used to, keep renting to the same tenants,” said Laarif, “but at the end of the year, instead of cover the deficit with the subsidy, they will sell a unit or two.”

That’s not a wise long-term solution, though. Eventually it will deplete all of their housing built in the 1970s and ‘80s — the majority of non-profit units — without having invested in anything to replace them. As a blanket move, it’s unsustainable.

So what are housing providers to do instead? Laarif and his AHMA colleagues think they have the answer.

They’ve developed a housing portfolio assessment tool that’s designed to help housing providers better manage their properties and balance their budgets, while preserving as much unsubsidized low-income housing as possible.

Here’s how it works. Housing providers assess the value of each unit in their portfolio using 25 different indicators. Some are financial, like operating expenses per square foot; others more strategic, like the size of the property their units occupy, and pending infrastructure plans nearby. Others are social, like proximity to hospitals and schools, and neighbourhood crime rates.

The tool juggles those inputs and kicks out recommendations that give providers the three best options out of five possibilities for each unit: sell, redevelop for higher density, rent at market rate, add to a community land trust, or keep subsidizing the rent.

“If a unit costs too much in terms of maintenance, [if] it’s located in an area where there is relatively no affordability pressure, and it’s far from hospitals, schools, etc., then that unit is obviously not the best fit for social or market rental,” said Laarif. “So we look at other options, like zoning to see if redevelopment is an option. Otherwise we’ll sell it, take that money and leverage it towards another project.”

Laarif got the idea from a similar tool developed by BC Housing to assess which units of social housing to keep under their control, and which units to devolve to their non-profit property managers.

The tool is still in development, as the AHMA seeks grant support to move it off of Excel spreadsheets and onto a more sophisticated software platform that can handle queries involving more units. Currently a portfolio of 50 apartments creates 5,000 cells of data in the Excel spreadsheet.

“If you have a portfolio of 800-900 [housing] units, it becomes almost impossible to manage on Excel, because it’s so easy to erase a cell or add an extra zero. That will affect the results, but you will never be able to notice that mistake,” said Laarif.

AHMA hopes to sell the finished product to its own members at a discounted rate, while also offering it to housing providers across Canada. Whatever revenue the sales provide will cover development and upgrading expenses, data storage and cyber security.

But while housing developers will depend less on government subsidies in the decades to come, if they use this tool they’ll depend more on government data: specifically, neighbourhood crime rates, walkability scores, planned infrastructure developments, zoning changes, and percentage changes in granted building permits — the information that feeds the tool’s algorithms.

Many databases cover major centres like the lower B.C. mainland only, Laarif notes. “We need to have access to a database that’s reliable, accurate, and covers the whole province.” Or, if the tool is to help soon-to-be-unsubsidized housing providers across the entire country, nation-wide.

But governments have some time to get their data in order — it will be another year and a half before the tool will be available for AHMA member use, helping keep their low-income tenants more securely housed after Ottawa withdraws its support.

* This story was updated on Dec. 2, 2016 at 11:32 a.m.  [Tyee]

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