The City of Richmond last week passed the 2017-2027 Affordable Housing Strategy at a city council meeting. The city has set a target of an additional 50 low-rent units per year, and the annual collection of $1.5 million in affordable housing reserve funding.
One of the biggest changes is that developers of projects containing more than 60 units are required to use 10 per cent of their project's total residential floor area for Low-End Market Rental (LEMR) units, which are targeted at low- to moderate-income households.
By comparison, the previous policy requires that only five per cent of units be designated LEMR units, and only projects with more than 80 units.
The new strategy also requires that a minimum of 15 per cent of the LEMR units set aside have to be two-bedroom apartments and also that five per cent need to be three-bedroom apartments, to make the project family-friendly.
Staff estimate that the new strategy will create an extra 50 low-rent units annually.聽
Developers who are unwilling to have some of their units set aside as LEMR units now also need to pay more cash-in-lieu contribution to the government, who will use the money to support affordable housing in Richmond, the new strategy says.
Cash-in-lieu contribution rates per square foot have increased from $6 to $10 for wood-frame apartments and from $6 to $14 for concrete buildings. Per-square-foot cash contributions also rose from $2 to $4 for single-family rezoning and from $4 to $8.50 for townhouse developments.
According to the staff report, the city has set the annual target for total cash contributions at $1.5 million, which will be used to 鈥渟upport innovative affordable housing projects, partnerships and land acquisition.鈥�
Both of the changes on LEMR and cash-in-lieu contribution were implemented in July, 2017, before the whole strategy was passed, "because council thought they were so important and didn't want to wait," according to Councillor Chak Au.
鈥淲e are on the right track... entring phase two of our strategy. Richmond is ahead of many communities already. I really look forward to working more closely with our community partners.鈥� said Au.
When the Richmond News asked Au whether developers will shift the financial pressure on to homebuyers now that they have to pay these extra costs, he admitted maybe, but 鈥渘ot 100 per cent鈥� of the pressure.
鈥淲e (the local government) also give them (developers) bonuses, such as a density bonus. It (extra costs) won鈥檛 be 100 per cent shifted on to home buyers.鈥�
The city's first 10-year Affordable Housing Strategy was adopted in 2007. Some 1,500 affordable housing units have been built since then.
