A Vancouver city councillor is calling for the suspension of financial incentives to developers under the city’s Rental 100 program.
The program offers breaks on development cost levies for buildings that are 100 percent rental. Maximum rents are also capped for the first tenants at rates established by the city.
While the goal of the program was to promote affordable housing, Coun. Jean Swanson says the program misses the mark, with the starting rents deemed “affordable” still considered too high.
“The lowest rent is almost $1,500 for a studio,” Swanson said Sunday. “The people who need the rents are lower-income people. You need to be making almost $60,000 a year to afford that.”
Swanson adds that a major pitfall of the program is that those rental limits only apply to the initial occupants.
“The problem is here, because we don’t have vacancy control, as soon as someone moves out of an affordable unit the rent goes up to market value,” she said.
WATCH: (Aired March 22) Sarah MacDonald talked to more councillors who are against the Rental 100 program
City council is expecting two reports on the program later this year after calling for a review by city staff. The first report is expected this summer.
According to the city, 2,161 rental units have been built over the past decade under the Rental 100 program and an earlier program known as Short-Term Incentives for Rental Housing (STIR).
The program has also seen controversy, with the city accidentally giving a developer a kickback for a project that didn’t qualify as Rental 100. The city later apologized and the developer paid the money back.
Still, some fear cancelling it without an alternative could put future rental projects in jeopardy.
WATCH (Dec. 2, 2016): Tanya Beja reports on a Vancouver developer that received a Rental 100 kickback by accident
“Are we actually going to be hurting the people who need it the most?” Coun. Sarah Kirby-Yung asked.
“Are we going to be cutting off the supply of rentals? Are those rents going to go up? Are developers going to build market condos instead because it’s easier and we’re not creating a market that is friendly to rental development?”
Kirby-Yung agrees the Rental 100 program can be improved with changes, but says those should come after councillors review the expert reports.
Swanson’s motion goes before council on Tuesday.