VANCOUVER, B.C.–Community Savings Credit Union here said it is partnering with Cascadia Green Development on a pilot program in the City of North Vancouver that aims to fight housing affordability and bring the dream of homeownership to people that are struggling to get a down payment.
The program was described as a first-of-its-kind rent-to-own development in Canada.
The program involves INNOVA, which will consist of 168 residential homes and about 30,000-square-feet of commercial space. Nine of the homes will be part of an Affordable Home Ownership Program (AHOP) and eight of the homes will be part of a Rent-To-Own (RTO) program that is designed to benefit the individual, providing an opportunity for new home buyers to allocate their rent towards the down-payment of their future home, according to the organizations.
“Vancouver has recently been ranked as the least affordable city in North America and as a credit union we can do something to effect change and encourage other lenders to do the same,” said Community Savings CU President/CEO Mike Schilling in a statement. “It has become difficult for first-time homebuyers to enter the housing market. If banks won’t give you financing, you are locked in a cycle of constantly paying high rents and not able to save for the deposit to get on the housing ladder. Through this project, we want to show what is possible when developers and lenders come together to truly benefit the community.”
First-Responders Prioritized
According to the organizations, the rent-to-own program will be prioritized for first responders or people who live or work in the City of North Vancouver. When final candidates are approved, a purchase/rental agreement will be signed by the applicant and the overall price of the home will be set at that time and will not fluctuate with the market value of the property. Once the individual has moved in, they will pay market-rate rent on their assigned home for 24 months, the organizations said.
At the end of the term, the full amount of the rent paid, in addition to the initial contribution, will be credited towards their final down payments.
“At Cascadia, our dream for this project was to focus on fostering a community and bring the dream of homeownership to young families and other community members,” said CEO Farzad Mazarei. “By collaborating with Community Savings we were able to see this dream become a reality. I hope to encourage other developers to take this initiative and work on similar developments to make housing in B.C. more affordable.”
How It Works
The shortlisted candidates’ information will be sent to Community Savings Credit Union for its approval. When final candidates are approved a purchase/rental agreement will be signed by the applicant, who will pay $5,000 upfront. The overall price of the home will be set at this time and will not fluctuate with the market value of the property.
Prior to move-in, they buyer is required to make another payment of $5,000 to receive a key to the property. Once the individual has moved in, they will pay market-rate rent on their assigned home for 24 months. At the end of the term the full amount of the rent paid, in addition to the two $5,000 (Total: $10,000) initial contribution, will be credited towards their final down payments. Individuals will also have an option to exit the program or complete the purchase.