New income requirements target middle-income families
Habitat for Humanity Sault Ste. Marie and Area has raised its minimum income requirement for applicants due to rising housing costs.
Recent price spikes have caused the organization to shift its focus, now requiring a minimum income of around $41,000 for candidates, up from $28,000 in 2018.
"So now we kind of serve the missing middle," Sault Habitat CEO Katie Blunt said in a recent interview with The Sault Star. "That would be the 40th to the 60th income percentile and that's just in response to rising cost of housing."
The change is even more pronounced in larger cities. In Toronto, Habitat's income requirements in 2022 ranged from a minimum of $67,266 to a maximum of $102,609, according to The Globe and Mail.
The rising cost of housing has priced out many who would traditionally qualify for Habitat's program. The city's 2023 Housing Needs Assessment report indicates that resale prices grew by approximately 80% between 2017 and 2022, far outpacing household income growth.
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Recent data from the Sault Ste. Marie Real Estate Board shows the average price of homes sold in May 2024 was $347,457, with a year-to-date average of $333,531.
Despite the challenges, some families are still benefiting from Habitat's program. Samantha Kyle, a single mother of two, secured a Habitat home in 2020 when her income reached the $40,000-$50,000 range.
Kyle, a social worker who previously relied on social assistance, struggled to find affordable housing after graduating from Algoma University in 2017.
"Realistically, it would have been more than a year before I could have enough saved, reduce my debt and fix my credit to the point that I would qualify for an actual mortgage," Kyle told the Star.
Kyle now finances her home through a geared-to-income mortgage, which is interest-free, doesn’t require a down payment, and doesn't exceed 30% of her yearly income. This model has been a cornerstone of Habitat's approach since its founding in 1985.
However, Habitat is also now utilizing commercial lender mortgages to adapt to rising construction costs.
"This world that we're living in is so complex. I feel like I have to pivot the organization constantly to respond to all these challenges," Blunt explained. "You now have cyber security to worry about, labour market challenges, materials, supply chain issues. It's a never-ending onslaught of challenges."
For those unable to meet Habitat's new income threshold, social housing may be the only option. Habitat is working with groups like Ontario Aboriginal Housing Services and the Sault Ste. Marie Housing Corp. to help people progress towards market ownership.
Despite the limitations, Blunt said they are committed to keeping Habitat operations on track, with new client bases and mortgage options allowing her team to address the affordability crisis effectively.
"It's our responsibility," Blunt said. "We need to work to address this affordability crisis, and this is the best way we can position ourselves to help every single year in this community."
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