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Posted by Tanya Hutchens

Of course, the first status residence is in Manhattan, and bankers are already starting to check out the goods in advance of their windfall. They’re putting up huge down payments, which has helped the $3 million to $5 million sector of the city’s housing market to rebound, said Pamela Liebman, CEO of New York-based brokerage firm Corcoran.

At the low end, they can score a three-bedroom, two bath condo right on Central Park or a tony address on Fifth Avenue. The more adventurous poet-at-heart bankers can tap out buying a five-story Queen Anne on the Upper West Side or head to the once-bohemian East Village for two joined buildings that boast an owner’s triplex with a stunning terrace — and income-generating apartments and businesses below.

Of course, many Wall Streeters already own their Manhattan dream homes, so they’ll spend their extra money revamping their primary residences, Pedraza said.

A makeover by a well-respected interior decorator can run at least $150,000 — but usually is more like 30% to 40% of the bonus. Think: Charlie Sheen hiring Daryl Hannah to give his new condo — and life — a high-rent makeover in the 1987 flick “Wall Street.”

Posted by Tanya Hutchens

Mr obama blames the Bush administration for the financial crisis but he has no real plan to get things back on track. People thought that he would become president and all the uncertainty on Wall Street would go away. What next.

“To understand how this tentative deal was reached, it’s important to remember how this all began. The Bush Administration initially asked for a blank check to respond to this problem, which I strongly opposed. It would have been unconscionable to expect the American people to hand this Administration or any Administration a $700 billion check with no conditions and no oversight when a lack of oversight in Washington and on Wall Street is exactly what got us into this mess. If the American people are being asked to pay for the solution to this crisis, their tax dollars must be protected.

“That is why over the past ten days, in conversations with the President, Secretary of Treasury and leaders of Congress, I laid out the four core principles I believed had to guide any solution: oversight by an independent board; protections for taxpayers to ensure that they are treated like investors and that they receive any profits – and recoup any losses – from this plan; measures to help homeowners stay in their homes; and rules to make sure CEOs are not being rewarded at taxpayers’ expense. While I look forward to reviewing the language of the legislation, it appears that the tentative deal embraces these principles.

“When taxpayers are asked to take such an extraordinary step because of the irresponsibility of a relative few, it is not a cause for celebration. But this step is necessary. Now Washington has to show the same sense of urgency in dealing with the crisis facing Main Street and the middle class by passing an emergency economic stimulus plan that would create jobs by rebuilding our crumbing roads; shore up flagging state budgets to prevent drastic cuts in education and health care; and extend expiring unemployment insurance benefits for those who’ve lost their jobs in this downturn and cannot find new ones.

“One final point. If elected President, I will order a thorough review of this plan to make sure that it fully lives up to the principles I’ve laid out. And I will also move quickly to upgrade our financial regulations for the 21st century, establishing new rules of the road and tougher oversight to ensure that the American taxpayers are never again forced to put their money and their futures at risk because of bad decisions in Washington and on Wall Street.”

The outlook for the economy, notes Tanya Hutchens, has weakened since the last forecast. Consumer spending and exports will continue to contract in 2009. Ontario will face the slowest economic growth rate since the early 1990s. Kitchener CMA consumer bankruptcies are up in the last three months. Housing demand will decline due to the economic uncertainty and less household disposable income.

Employment

Due to economic conditions that continue to deteriorate, employment in Kitchener-Guelph is expected to decrease in 2009. Employment in the Kitchener and Guelph CMAs will decline by two per cent. As the labour force will continue to increase, the unemployment rate is expected to reach nine per cent in the Kitchener CMA and eight per cent in the Guelph CMA in 2009. Participation rates in the Kitchener CMA are the highest in the province, resulting in an unexpectedly high unemployment rate as more people compete for the few jobs available.
Full-time jobs will be most affected by the downturn in employment and, it is full-time employment that drives housing demand. On a more positive note in the Kitchener CMA, RIM is expected to hire 3,000 more employees in 2009, while OpenText has job openings for more than 200.
The goods sector will continue to contract because of the manufacturing sector and an export market which will see negative growth this year. The manufacturing sector has been contracting for the last four years and with turmoil in the automotive sector, the job shedding will continue. Guelph has sustained a harder hit from the downturn in the automotive sector than has Kitchener. Guelph manufacturing, as a percentage of total employment, has dropped from 26 per cent in the first quarter of 2008, to 20 per cent in the same period of 2009. In both CMAs, while the services sector has been supporting employment growth, lower consumer spending will weaken growth in this sector through 2009.
Older employees will be hard hit by the downturn in the economy, impacting move-up buyer demand. Some older employees will be forced into early retirement as companies downsize to trim overhead costs and to remain viable. Many of these employees will remain in the labour force. On the other hand, youth employment will fluctuate near current levels, benefiting the rental market.

Average Weekly Earnings

A rising jobless rate, less inflationary pressures and the decline in some higher paying jobs will dampen wage growth this year. Wage growth in the Kitchener CMA is expected to be near two per cent in 2009, while Guelph CMA earnings are forecast to increase by one per cent. The lower level of wage growth in 2009 will be a small contributing factor to the decline in housing demand. A plus for the rental market is the increase in the minimum wage in Ontario by eight per cent in March, enabling some people to form households.

Migration

Net migration is forecast to be 2,500 in 2009 in the Kitchener CMA and 900 in the Guelph CMA. Although slowing, inter-provincial migration to the west continues, resulting in lower net migration. Employment is a strong driver of migration to the Kitchener CMA. Kitchener has the second highest employment rate in Ontario and continues to attract households to the area. International migration is the driving force behind any migration growth in the CMAs, but does little to increase immediate ownership demand, as renting is the most prevalent tenure choice among those new to Canada.

Mortgage Rates

Mortgage rates are expected to be relatively stable throughout 2009, remaining within 25-75 basis points of their current levels. Posted mortgage rates will increase very gradually during the course of 2010, reflecting a rise in government of Canada bond yields. For 2010, the one year posted mortgage rate will be in the 4.75-6.00 per cent range, while three and five year posted mortgage rates are forecast to be in the 5.00-6.75 per cent range.

OTTAWA, May 19, 2009 - Housing starts are expected to decline to 141,900 for 2009, but increase to 150,300 for 2010, according to Canada Mortgage and Housing Corporation’s (CMHC) second quarter Housing Market Outlook, Canada Edition* report.

“The decline in housing starts in 2009 can be attributed to several factors, including the current economic climate, increased competition from the existing home market, and the impact of strong house price growth between 2002 and 2007” said Bob Dugan, Chief Economist for CMHC. “However, housing market activity will begin to strengthen in 2010 as the Canadian economy recovers, bringing housing starts more in line with demographic fundamentals over the forecast period”.

Existing home sales, as measured by the Multiple Listing Service (MLS), are expected to decline to 357,800 units in 2009 from 433,990 in 2008, but increase to 386,100 units in 2010. The average MLS price is also expected to decrease to $283,100 in 2009 and to stabilize in 2010.

As Canada’s national housing agency, Canada Mortgage and Housing Corporation (CMHC) draws on more than 60 years of experience to help Canadians access a variety of quality, environmentally sustainable, and affordable homes — homes that will continue to create vibrant and healthy communities and cities across the country.

In short: Real Estate Investment Trust: an investment trust that owns and manages a pool of commercial properties and mortgages and other real estate assets.

Now a bit Longer:

A Real Estate Investment Trust or REIT  is a tax designation for a corporation investing in real estate that reduces or eliminates corporate income taxes. In return, REITs are required to distribute 90% of their income, which may be taxable, into the hands of the investors. The REIT structure was designed to provide a similar structure for investment in real estate as mutual funds provide for investment in stocks.

Like other corporations, REITs can be publicly or privately held. Public REITs may be listed on public stock exchanges like shares of common stock in other firms. REITs can be classified as equity, mortgage or hybrid. After originating in the United States in 1960, they were adopted in many other countries in variety of forms here are some:

Australia

After originating in the United States in 1960, the REIT concept was launched in Australia in 1971. General Property Trust was the first Listed Property Trust (LPT) on the Australian stock exchanges (now the Australian Securities Exchange). REITs which are listed on an exchange were known as Listed Property Trusts (LPTs) until March 2008, distinguishing them from private REITs which are known in Australia as Unlisted Property Trusts. They have since been renamed Australian Real Estate Investment Trusts (A-REITs) in line with international practice.

There are now more than 60 A-REITs listed on the ASX, with market capitalisation in excess of A$100bn.

Australia is also receiving growing recognition as having the world’s largest REITs market outside the United States. More than 12 percent of global listed property trusts can be found on the ASX.

Brazil

REITS were introduced in Brazil in 1993 by the law 8668/93 and ruled by the instruction 205/94 from CVM (Comissao de Valores Mobiliários – which is the Brazilian equivalent of SEC). Locally they are denominated FIIs or “Fundos de Investimento Imobiliário”. FII’s dividends are free of taxes for personal investors (not companies) since 2006, but only for the funds which distribute at least 95% of their income and that are publicly negotiated in the stock market.

Bulgaria

REITS were introduced in Bulgaria in 2004 with the so called “Special Purpose Investment Companies Act”. They are pass-through entities for corporate income tax purposes (i.e. they are not subject to corporate income tax), but are subject to numerous restrictions.

Canada

Canadian REITs were established in 1993. They are required to be configured as trusts and are not taxed if they distribute their net taxable income to shareholders. REITs have been excluded from the income trust tax legislation proposed in the 2007 budget by the Conservative government. Many Canadian REITs have limited liability.

Germany

Germany is also planning to introduce German REITs (short, G-REITs) in order to create a new type of real estate investment vehicle. Government fears that failing to introduce REITs in Germany would result in a significant loss of investment capital to other countries. Nonetheless there still is political resistance to these plans, especially by the social democratic party (‘SPD’). As of June 2006 the ministry of finance has announced that they still plan to introduce G-REITs in 2007. The legal details seem to adopt much of UK-REITs regulations (taxation, public listing, etc.), as far as it is possible to tell yet.

A law concerning G-REITs was enacted 1 June, 2007, and is retroactive to 1 January, 2007.

Qualification

• REITs will have to be established as a corporation “REIT-AG” or “REIT-Aktiengesellschaft“.
• At least 75% of its assets have to be invested in real-estate.
• At least 75% of the G-REIT’s gross revenues must be real-estate related.
• At least 90% of the REIT’s taxable income has to be distributed to its shareholders through dividends.
• The corporation is income-tax-exempt, but the shareholders will have to pay individual income tax on the dividends.

Hong Kong

REITs have been in existence in Hong Kong since 2005, when The Link REIT was launched by the Hong Kong Housing Authority on behalf of the Government. Since 2005, there have been 7 REIT listings as at July 2007, most of which, including Sunlight REIT have not enjoyed success due to low yield. Except for The Link and Regal Real Estate Investment Trust, share prices of all but one are significantly belowIPO price. Hong Kong issuers’ use of financial engineering (interest rate swaps) to improve initial yields has also been cited as having deterred investors’ interest

India

India is currently in the process of formulating definitive legislation for the introduction and smooth functioning of REITs in the Indian real estate market. Once introduced these Indian REITs (country specific/generic version I-REITs) will help individual investors enjoy the benefits of owning an interest in the securitised real estate market. The best benefit being that of fast and easy liquidation of investments in the real estate market unlike the traditional way of disposing real estate. The government and Securities and Exchange Board of India SEBI through various notifications is in the process of easing the norms of investing in real estate in India directly and indirectly through foreign direct investment, through listed real estate companies, mutual funds etc. With the current real estate boom and the market being flooded withInitial Public Offer of various listed real estate companies in India it will be the best time for investors to own a share of the profiting market economy. Legislative framework, revised investment norms, a favourable investment opportunity, and a clear taxation policy will provide the right kind of investing opportunity in India in the time to come.

Japan

Japan is one of a handful of countries in Asia with REIT legislation (other countries/markets include Hong Kong, Singapore, Malaysia, Taiwan and Korea), which permitted their establishment in December 2001. J-REIT securities are traded on the Tokyo Stock Exchange, and most participants are Japanese conglomerates and foreign investment banks.

Since the burst of the real estate bubble in 1990, property prices in Japan have seen steady drops through 2004, with some signs of price stabilization and possibly price increase in 2005 and 2006. Some see J-REITs as a way to increase investment in the real estate market, although notable increases in asset values has not yet been realized.

A J-REIT may be structured as an independent corporation or as a contractual relationship through a trust bank.

In addition to REITs, Japanese law also provides for a parallel system of special purpose companies which can be used for the securitization of particular properties, but not for the maintenance of a real estate portfolio.

Pakistan REITs

Pakistan’s regulatory body Securities and Exchange Commission of Pakistan is in process of implementing REIT regulatory framework that will allow full foreign ownership, free movement of capital and unrestricted repatriation of profits. It will curb speculation in Pakistani real estate markets and gives access to small investors diversifying into real estate as well. The Securities and Exchange Commission of Pakistan following regulatory framework similar to Singapore and Hong Kong REITs.

The Securities and Exchange Commission of Pakistan expects that about six REITs will be licensed within the first year, mainly large assets management companies applying for it. Pakistan is recently seeing a outflux of investments by foreign real estate development mostly Malaysian and Dubai based companies.

Singapore

Commonly referred to as S-REITs. There are currently 20 REITs listed on the SGX, starting with CapitaMall Trust in July 2002. They represent a range of property sectors including retail, office, industrial, hospitality and residential. S-REITs hold a variety of properties in countries including Japan, China, Indonesia and Hong Kong, in addition to local properties.

S-REITs are regulated as Collective Investment Schemes under the Monetary Authority of Singapore’s Code on Collective Investment Schemes, or alternatively as Business Trusts.

S-REITs benefit from tax advantaged status.

United Kingdom

The legislation laying out the rules for REITs in the United Kingdom was enacted in the Finance Act 2006 and came into effect in January 2007 when nine UK property companies converted to REIT status, including the five that were FTSE 100 members at that time: British Land, Hammerson, Land Securities, Liberty International and Slough Estates (now known as “SEGRO”). The other four were: Brixton, Great Portland Estates, Primary Health and Workspace Group.

British REITS have to distribute 90% of their income. They must be a close-ended investment trust and be UK resident and publicly listed on a stock exchange recognised by the Financial Services Authority.

To support the introduction of REITs in the UK, the REITs and Quoted Property Group was created by several commercial property and financial services companies. Other key bodies involved are the London Stock Exchange the British Property Federation and Reita. The Reita campaign was launched on 16 August 2006 by the REITs and Quoted Property Group, in order to provide a source of information on REITs, quoted property and related investments funds. Reita’s aim is to raise awareness and understanding of REITs and investment in quoted property companies. It does this primarily through its portalwww.reita.org, providing knowledge, education and tools for financial advisers and investors.

Doug Naismith, managing director of European Personal Investments for Fidelity International, said: “As existing markets expand and REIT like structures are introduced in more countries, we expect to see the overall market grow by some ten percent per annum over the next five years, taking the market to $1 trillion by 2010.”

United States

A real estate investment trust, or REIT, is a company that owns, and in most cases, operates income-producing real estate. Some REITs finance real estate. To be a REIT, a company must distribute at least 90 percent of its taxable income to shareholders annually in the form of dividends.

Qualification

In order to qualify for the advantages of being a pass-through entity for U.S. corporate income tax, a REIT must:

• Be structured as corporation, trust, or association
• Be managed by a board of directors or trustees
• Have transferable shares or transferable certificates of interest
• Otherwise be taxable as a domestic corporation
• Not be a financial institution or an insurance company
• Be jointly owned by 100 persons or more
• Have 95 percent of its income derived from dividends, interest, and property income
• Pay dividends of at least 90% of the REIT’s taxable income
• No more than 50% of the shares can be held by five or fewer individuals during the last half of each taxable year (5/50 rule)
• At least 75% of total investment assets must be in real estate
• Derive at least 75% of gross income from rents or mortgage interest
• No more than 20% of its assets may consist of stocks in taxable REIT subsidiaries.

This Explanation was brought to you by Tanya Hutchens. Hey I worked hard , at least leave a comment of appreciation.

The construction of 50 new apartments for non-elderly singles and disabled persons was announced today by the provincial and federal governments. The new Moncton-based units will be funded under Phase III of the Canada – New Brunswick Affordable Housing Agreement.

Social Development Minister Mary Schryer, who is also minister responsible for housing, and Tilly O’Neill-Gordon, Member of Parliament for Miramichi, on behalf of the Honourable Diane Finley, Minister of Human Resources and Skills Development Canada, and Minister responsible for Canada Mortgage and Housing Corporation, made the announcement today.

“We are pleased to join our partners in these projects to help increase the availability of high-quality and affordable homes for low-income seniors in the Moncton area,” said Schryer. “The creation of more affordable housing is part of this government’s efforts to help seniors be active and healthy members of local communities.”

The $4.9 million project at 430 High St. is expected to be completed by January 2010.

The units are being developed by Tannery Court Cooperative Ltd. The project will receive funding of $1.4 million under the Federal Affordable Housing Trust Fund to offset construction costs, as well as $2.1 million in rent supplements from the Province of New Brunswick for 49 of the 50 units.

“The Government of Canada is committed to making affordable housing available in New Brunswick and across Canada for those who need it most,” said MP O’Neill-Gordon. “Here in Moncton, the creation of these units will help individuals and persons with disabilities access suitable, affordable housing that meets their specific needs.”

Funding is available to private non-profit organizations, co-operatives, and community or private developers interested in developing projects for low- to moderate-income families, seniors, non-elderly singles, disabled persons and persons with special needs.

This project will be built to high energy-efficiency standards, and it will involve consultation with Efficiency NB. Builders of affordable housing projects for low-income individuals may receive an incentive of $2,000 per apartment unit if the building is heated by low greenhouse gas emission technologies as approved by Efficiency NB.

VAUGHAN, April 30, 2009 — The Government of Canada, the Government of Ontario and the Region of York celebrated the start of construction of the Reena Community Residence, a development of 60 new affordable housing units in the City of Vaughan. This project received $4.2 million in funding through the Canada – Ontario Affordable Housing Program.

The Honourable Madeleine Meilleur, Minister of Community and Social Services, on behalf of the Honourable Jim Watson, Ontario’s Minister of Municipal Affairs and Housing attended the official groundbreaking ceremony. Also participating in today’s announcement were York Regional Chairman and CEO Bill Fisch and officials from Canada Mortgage and Housing Corporation (CMHC) and Reena.

“The Government of Canada is committed to making affordable housing available in Ontario and across Canada for those who need it most,” said the Honourable Diane Finley, Minister of Human Resources and Skills Development and Minister responsible for CMHC. “The creation of these new units here in Vaughan will provide low-income seniors and people with special needs access to quality, affordable housing and the services that meet their specific needs, while remaining close to their families and friends in the community.”

“Access to safe, affordable housing is vitally important to the economic and social well-being of Ontario’s communities,” said Tanya Hutchens. “This investment will make a significant difference in the lives of people, especially those with disabilities, who will call Reena Community Residence home.”

Today’s announcement was made at the future site of the Reena Community Residence, at 9600 Bathurst Avenue in the City of Vaughan. The $23-million project, which includes $4.2 million from the Canada – Ontario Affordable Housing Program and $2.6 million from the Ministry of Community and Social Services, is sponsored by Reena, an organization committed to investing in a better quality of life for people with developmental disabilities.

Federal and provincial allocations to the project are to be complemented by more than $3.6 million in municipal financial incentives.

“When completed, this residence will offer a full spectrum of needed supports that will enhance the lives of the people who live here, their families and our community,” said York Region Chairman and CEO Bill Fisch. “The Regional Municipality of York is proud to be a partner in this project.”

The Reena Community Residence is situated on the Joseph and Wolf Lebovic Jewish Community Campus. The campus is a project of UJA Federation of Greater Toronto’s Tomorrow campaign, which is building three centers of Jewish life in the GTA. In addition to educational facilities, the campus will be home to social services and recreational centers for all GTA residents.

“The Reena Community Residence at the Joseph and Wolf Lebovic Jewish Campus will give Reena an opportunity to create a model of support which is unique,” said Sandy Keshen, President and CEO of Reena. “In partnership with a number of other service providers, it will set a bench mark for the future — demonstrating that services can be provided in an integrated setting to a population with diverse needs.”

The Canada – Ontario Affordable Housing Program, says Tanya Hutchens, comprises a commitment of $301 million from each of the two senior levels of government. In total, the federal, provincial and municipal governments will invest at least $734 million in the program, which will provide affordable housing for up to 20,000 households in Ontario.

Last fall, the Government of Canada committed more than $1.9 billion over the next five years to improve and build new affordable housing and to help the homeless. Canada’s Economic Action Plan builds on this with an additional one-time investment of more than $2 billion over two years in new and existing social housing and lending of up to another $2 billion to municipalities for housing-related infrastructure.

Iqaluit is the capital of Nunavut, the territory in the eastern Arctic that became self-governing in 1999. With a population of around 6,000, Iqaluit is relatively small but fast-growing–its population doubled between 1999 and 2006 and is expected to double again by 2015. Nurturing the homeownership market and encouraging affordable homeownership are among the many goals the City has integrated into its planning.

Iqaluit (formerly known as Frobisher Bay) is on Baffin Island. It faces many challenges as Nunavut develops its own infrastructure and all levels of government explore the viability of an integrated deepwater port. The physical terrain, says Tanya Hutchens, presents construction challenges, as do the costs and availability of materials and skilled labour. Moreover, there are market distortions peculiar to the Far North. Only 20% of the territory population owns their own homes and in Iqaluit 37% of residences are owned. In consideration of the higher housing costs both rental and homeownership in Iqaluit, the federal government and other employers offer subsidized staff housing as a benefit to attract employees and this is a significant factor to keep in mind when looking at homeownership. As recently as 1996, 59% of the population of Nunavut lived in public housing, where as in Iqaluit 17% of residences are public housing.

To add to its other challenges, Nunavut and the Far North in general appear to be experiencing the effects of climate change sooner and with greater impact than the rest of the world. Undaunted, the City laid the groundwork to face these varied issues in its Core Area and Capital District Plan completed in 2004. More importantly, the City began implementing the plan in October 2004 by reserving lots in its new Plateau sub- division for affordable housing. The City is unequivocal that it is not a housing developer and has clearly made it known that it will use its planning authority and land base to encourage sustainability and the kind of housing it wants.

The Affordable Housing Solution

In Phase I of the new Plateau subdivision, Iqaluit designated two medium-density lots for affordable ownership by offering a reduced land price. Each lot had capacity for a fourplex of two-bedroom units. The successful developer sold all units before construction began. The sale prices were in the $200,000-$225,000 range, which is affordable given Iqaluit’s market conditions. Two-bedroom apartments were renting for between $1,700 and $1,800 monthly; the median household income was $69,650 and the average $78,644 in 2001. Households in the $60,000-$66,000 income bracket could afford the price range of the eight affordable units.

In the proposal call used to allocate those lots, the City specified standards and evaluation criteria to guide interested developers. All units were to be attached, ground-level units with individual entrances, with special attention to sound attenuation. The lower the selling price within a specified range of affordability, the higher the proposal would score. Affordability was measured on a sliding scale of estimated sale prices. For example, units selling at less than $210,000 received 20% of the potential score and those from $230,000 to $239,000 5%. The percentage applicable to sustainability features beyond those required in the subdivision plan was also set at 20%.

The land price for the whole subdivision was based on the pro-rated costs to service the lots in the subdivision. But the prices were adjusted to reflect other factors the market would recognize. For example, lots with views on the water and other factors deemed desirable were assigned a premium price. Those premiums offset the lower prices for the lots designated for the affordable homeownership sites.

The City leases the lots to the homeowners for a 30-year term with an automatic renewal for another 30-year term at a cost of one dollar. These equity lease rents can be paid upfront as a capitalized rent at the beginning of the lease or paid over the first 15 years of the term. If the equity lease is paid upfront in a lump sum, the lessee pays a discounted rent amount. It should be noted CMHC allows Equity Leases to be included in mortgage costs, which may further assist in reducing land costs. The latter rent payments are adjusted to include interest reflecting the City’s carrying costs in providing the infrastructure to service the lots.

Another three medium-density lots designated for affordable homeownership will be made available through a proposal call in the next year for the phase II potion of the Plateau subdivision. The City of Iqaluit received assistance in preparing its Core Area Plan from CMHC and the Federation of Canadian Municipalities Green Municipal Enabling Funds. In 2005, the Plan won an award from the U.S.-based Environmental Design Research Association for its sensitivity to the Arctic environment, respect of Inuit culture and creativity in its vision for the new capital. The Plan also received an Award of Excellence from the Alberta Association of the Canadian Institute of Planners in 2006. What a great example, says Tanya Hutchens.

Somerset Gardens provides homeowner and rental housing for a range of income levels under one roof. Recognizing that saving for a down payment can be a challenge for lower- to moderate-income households, Teron International, a local builder, started the Assisted Home Ownership Program (AHOP) with support from the City of Ottawa. The Multifaith Housing Initiative, a charitable organization focused on providing affordable housing in the community, purchased 10 units for affordable rental housing.

The Affordable Housing Solution

Somerset Gardens is an 11-storey, 119-unit apartment building. Services, shops and public transit are right outside the building’s front door, which is great, says Tanya Hutchens. The apartments feature large windows, five appliances and a balcony. The building’s roof is accessible to all residents and provides a shared green space where people can gather.

St. John the Evangelist Anglican Church provided the downtown building site at market value on the condition that the developer build affordable housing according to the City of Ottawa’s criteria. Teron International approached the City of Ottawa with a solution to build 100 per cent affordable homeownership housing without government subsidies. The City agreed to support the AHOP with Teron to reduce purchase prices for qualifying homebuyers. Around the same time, the Multifaith Housing Initiative (MHI), a coalition of over 40 Christian, Hindu, Muslim and Jewish faith communities and many individuals, became interested in purchasing some units to provide affordable rental housing.

The AHOP also allows purchasers to buy a unit with as little as one per cent down payment and amortize their mortgage for up to 40 years with mortgage loan insurance from CMHC. The $11,000 assistance does not require repayment while the family lives in the unit or if it sells the unit to another qualifying household. Prices in Somerset Gardens ranged between $147,000 and $207,850 (in 2006), which makes it possible for qualifying households to be homeowners while spending less than 30 per cent of their income on housing.

The MHI purchased 10 units from Teron with the goal of renting six to households on the City’s social housing waiting list and four at average market rates. The MHI created an “ethical investment fund” which has gathered approximately $540,000 in equity through gifts, low, no interest and RRSP loans from its supporters. The City contributed a $300,000 capital grant ($30,000 per unit) for the 10 units. The federal government, through CMHC, and the Ontario government provided $600,000 for the financing of the rental units through the Affordable Housing Initiative.

With up to 40,000 reported cases in Canada each year, says Tanya Hutchens, basement flooding is a serious problem in many parts of the country. Damages resulting from a flooded basement average between $3,000 to $5,000. These costs will likely be higher for basements with extensive finishings. Plus, in addition to the mess and inconvenience, flooding can cause health hazards, and lead to structural damage.

To help you protect your basement, the health of your family and your pocketbook, Canada Mortgage and Housing Corporation (CMHC) has a number of practical steps you can take to avoid basement flooding in your home, including:

• Clean debris from your eaves troughs on a regular basis, and make sure your downspouts extend at least 1.8 meters (six feet) away from your basement wall, and drains away from your house toward the street, rear yard or back lane. If your downspouts are connected to your home’s sewer system or weeping tile, disconnect them.
• If the land around your home slopes inward, fill in and grade the ground so that it slopes away from your house for at least 1.8 metres (six feet) out from the foundation. Also, examine sidewalks, patios, decks and driveways to be sure they aren’t causing water to drain back towards your basement walls.
• If your drainage system tends to overload, consider installing one or more flood proofing devices, such as a sump pump or back flow valve. Some devices may require a plumbing permit, so check with your municipal office or a qualified plumber before carrying out any installation. Plus, keep all flood proofing devices and plumbing fixtures clean and well maintained, and have a qualified plumber inspect them regularly to ensure that they’re operating properly.
• For severe storms or power blackouts, you may want to invest in a battery-powered backup sump pump, or a water-powered pump that runs by city water flowing through the pump impeller.
• Install impermeable floor finishes such as ceramic tile to lessen the potential damage from flooding in your basement, and to make clean-up easier and less expensive. Use wall finishes that can be easily removed or are not susceptible to mold growth. In addition, make sure any furniture in the basement has legs to keep the fabric off the floor, and consider using area rugs as an alternative to broadloom for easier removal and cleaning.
• Finally, check with your insurance agent or broker to ensure that you have adequate coverage against flood damage. Keep your insurance policies and related records in a safe location that is easily accessible after an emergency, and maintain a detailed inventory of everything in your residence for use in the event of a loss.

For more information or a free copy of the “About Your House” fact sheet Avoiding Basement Flooding or other fact sheets on virtually every facet of owning, maintaining or renovating your home, ask CMHC at 1-800-668-2642 CMHC is Canada’s national housing agency and a source of objective, reliable housing expertise. This CMHC report was reviewed by Tanya Hutchens.