With the provincial election a month away, British Columbia Premier David Eby dangled the “dream of home ownership” in front of voters with a plan to subsidize 2,600 homes available for purchase on a 99-year strata leasehold on First Nations land in Vancouver.
In partnership with MST Nations, the province announced on Thursday a development of the homes at an “initial 40% below market value” with the expectation that the portion the government finances is to be paid back upon resale of the property or after 25 years in the form of a second mortgage.
“The dream of home ownership has been out of reach for too many, for too long, especially here in Vancouver,” said Premier David Eby.
“This innovative initiative – delivered in partnership with MST Nations – will help thousands of middle-class people break into the housing market, while allowing government to recoup its financial contribution.”
Buyers will be able to pay a 5% deposit on 60% of the home’s “market value” for studio, one, two and three-bedroom homes on a 99-year strata leasehold. Unlike a freehold purchase agreement, the purchaser will not own the land where the property is situated – meaning the land title will remain with the First Nations.
The BC government evaluated “market price” for one bedrooms at $850,000, two bedrooms at $1.3 million and three bedrooms at $1.5 million. With the government’s finance scheme, the leases will cost $510,000, $780,000 and $900,000 respectively.
“We jumped at the opportunity to partner with the MST Nations in this Initiative, and we’re going to keep working to put home ownership within reach and provide more affordable housing options for people,” said Minister of Housing Ravi Kahlon in a press release.
Stipulations of the agreement state that 40% of the market price will be financed by taxpayers via the Affordable Housing Initiative which must be repaid after 25 years or upon resale. If the buyer chooses to resale, they will be able to acquire up to 60% of the original purchase equity interest and appreciation if they live more than four years in the residence.
Purchasers will be required to show that they have a net household income below $131,950 as of 2024 and net household assets below $150,000 for studio and one bedrooms. That threshold increases to $191,910 annual household income and $250,000 in assets for two or more bedroom homes.
Buyers are also required to be Canadian citizens or permanent residents and have resided in BC for 24 consecutive months.
The BC government also prohibits anyone who owns “an interest in any other property anywhere else in the world” from the purchase agreement although no details were provided on how buyers will be vetted.
True North reached out to the Ministry of Housing for comment but did not receive a response.
