Initiative to offer condos at 60% of market value, with government covering the rest until resale
A new agreement between British Columbia and three First Nations will make 2,600 homes in Vancouver available at prices well below market value.
The deal, which involves the Musqueam, Squamish, and Tsleil-Waututh First Nations, will see one-, two-, and three-bedroom units sold at 60% of their market value, with the government covering the remaining 40%.
The initiative aims to make homeownership more accessible in a city where skyrocketing real estate prices have left many prospective buyers locked out of the market.
Premier David Eby called the collaboration a "remarkable" accomplishment, especially in one of the world's most expensive real estate markets.
"The dream of home ownership has been out of reach for too many, for too long, especially here in Vancouver, " Eby said during the announcement.
The agreement allows buyers to purchase units on a 99-year lease on First Nations land. The province will finance 40% of the condo's value, to be repaid either when the unit is sold or after 25 years.
A studio apartment is expected to sell for around $372,000, while a one-bedroom unit will be priced at $510,000, and a two-bedroom condo will go for approximately $780,000. Of the 2,600 homes, about 540 will be designated as social housing.
Eby emphasized that this plan will help thousands of middle-class residents break into the housing market, allowing families to settle in Vancouver and add to its workforce and economic growth.
Read more: Billion-dollar Indigenous-led housing projects underway in Vancouver
"This means more families living and working here can put down roots, while also addressing labour challenges and driving our economy forward," he said.
To prevent speculators from taking advantage of the reduced prices, the agreement includes several safeguards. Prospective buyers will need to meet household income thresholds, with a maximum income of $131,950 for studios and one-bedroom units. Buyers must also pre-qualify for a mortgage and make a minimum down payment of 5%.
Screening for eligible buyers is expected to begin next spring, and a randomized selection process will be used to ensure fairness, with priority given to first-time homebuyers.
Read next: Rethinking Indigenous housing: New report pushes for change
The provincial government estimates its financial contribution to the project will total about $670 million in loans. However, Eby noted that the government's investment would eventually be recouped when buyers sell their homes or after the 25-year repayment period.
The premier also hinted at expanding similar initiatives across the province, adding that affordable housing would be a key focus of the NDP's platform in the upcoming election.
Make sure to get all the latest news to your inbox on Canada’s mortgage and housing markets by signing up for our free daily newsletter here.
