Nova Scotia has a new lending scheme to protect existing affordable housing in the province and create more, Housing Minister John Lohr announced Wednesday.
Under the new Community Housing Acquisition Program, or CHAP, non-profit organizations can borrow up to $10 million to help purchase existing buildings.
Lohr outlined the plan in front of a building on Crown Drive in Halifax that has been purchased by the Housing Trust of Nova Scotia — along with four others in the city — with the help of a $5.6 million low-interest mortgage from the new fund.
In total, the Housing Trust spent $30 million on 295 units that president Ross Cantwell says would have otherwise been purchased and renovated by a private developer.
Tenants in Halifax have been complaining about 'renovictions' in which building owners fix up older units and then rent them to new tenants at much higher prices.
Trisha Estabrooks has lived at 18 Crown Dr. with her two sons for the past five years.
"I heard rumours that the building had been sold and started kind of freaking out," she said.
"But I was so relieved when I found out that there was actually somebody who actually wants to try to help solve some of the issues that are happening in Halifax around housing."
Lohr said the program will help other organization offer reasonable rents.
"We heard about some of the challenges non-profits face when they see an opportunity to invest in affordable housing, and this new lending program will help preserve and increase affordable housing stock for people and families in need," he said.
"We have seen rental properties purchased by investors and heard the stories of rents being increased out of reach for existing tenants. This program not only prevents further gentrification and loss of affordable housing but also ensures tenants can continue to live in their homes."
To qualify for funding under the new program, the purchaser must be a registered non-profit organization in Nova Scotia and must have appropriate management experience operating rental housing projects of similar size and scope. If it doesn't, it must hire professional property managers.
Cantwell said the Housing Trust is planning $15 million in renovations to all the five buildings purchased. He says rent won't change for most tenants.
"Obviously anyone who's in here, there's a rent control scenario," he said. "We're not exempt from that. So all of our tenants continue to enjoy the leases that they have. The goal for the Housing Trust has always been that over time, some portion of the units would go to something closer to market rate and that would be on a building-by-building basis."
"The way we will rate ourselves in the future is how many [units] have we been able to keep affordable? That is the goal — not maximizing profit. We're hoping over time that two-thirds of the units stay at these levels and — through attrition over a long period of time — one-third might pay a bit higher. So we're still working on those details."
The Halifax Regional Municipality is helping with the program by waiving the deed-transfer tax associated with buildings sold with help from CHAP. Residential care facilities, student residences or long-term care facilities do not qualify for CHAP.
MORE TOP STORIES