From La Presse: The federal government considers $2,225 per month to be “affordable” rent in the Greater Montreal Area, La Presse reported Tuesday.
- Since 2017, the Canada Mortgage and Housing Corporation has granted more than $350 million in low-interest loans to Quebec real estate developers through the Rental Construction Financing Initiative (RCFI) on condition they rent a portion of their units at an “affordable” rate, according to La Presse.
The CMHC defines “affordable” rents as costing no more than 30 per cent of a region’s median before-tax household income, which critics note can work out to thousands of dollars per month and be much more expensive than many low-income and working-class renters can afford.
- La Presse notes that the median income for Greater Montreal is $88,990 per year, which means CMHC’s definition of “affordable” rent in the region works out to more than $2,000 per month.
The CMHC set up RCFI in 2017 with a starting budget of $13.75 billion. The Liberal government added another $12 billion to the fund last year, La Press notes.
- Steve Pomeroy, a professor at Carleton University who has researched RCFI, told La Presse that loans from the program account for “at most” four per cent of new housing developments since the program started, and said Ottawa should instead direct funds towards truly affordable housing.
Pomeroy believes the low-interest loans are just a bonus for private real estate developers, who he thinks would build new housing developments in most cases even without the loans, according to La Presse.
Read La Presse’s full report here.