James Street North condo aims to be a model for affordability
Units can be subdivided, open to communal living or be a ‘turnkey’ condo; what will city planners think?
IF YOU HAVE THE SKILLS, your “sweat equity” can reduce the price of a new — and unfinished — condo unit on James Street North.
Flexibility is key in John van Nostrand’s plan to bring home ownership within the reach of those shut out of the rising market.
“We have a basic rule. We don’t need to decide anything. People can decide for themselves,” says van Nostrand, director of JvN/d.
A buyer could purchase a unit, throw up a wall, live in one side and rent out the other for extra income. Later, the owner could knock down that wall and open up the space for a growing family.
You can also purchase a fully finished “turnkey” condo, or get together with a few friends to combine a few units into a communal living space.
The project, called Home: Front, promises to be a head-scratcher for municipal planners, who are used to evaluating a fixed number of units and dimensions, including building height.
But van Nostrand says he can’t yet nail down those figures since prospective buyers have the option to combine and divide units.
“I think it will strike fear into some people’s hearts,” says van Nostrand, a planner and architect.
So JvN/d, from its office at 468 James St. N., has made it a point to reach out to the neighbourhood,
We have a basic rule. We don’t need to decide anything. People can decide for themselves. JOHN VAN NOSTRAND DIRECTOR OF JVN/D
an effort that includes addressing fears the project will expedite gentrification in the historically working-class North End.
Emily Power estimates JvN/d knocked on 1,500 doors to ask people how they felt about changes in the neighbourhood.
“We really see this project as a chance to intervene in that process of gentrification and displacement,” said Power, Home: Front co-ordinator.
JvN/d bought two low-rise buildings on the east side of James Street North at Ferrie Street East for $1.6 million in April. The plan is to start sales in the spring or summer. Sweat equity isn’t the only route to ownership JvN/d offers.
If buyers can’t make the down payment, the developer will co-invest in their purchase, eventually allowing them to buy them out later. The firm makes money from the presumptive rise in real estate value when the owner settles up, Power says.
“We expect that most people will be able to do that by year five, but at the very latest, by year 10.”
JvN/d hasn’t yet priced the units but says the most basic one at 225 square feet will be affordable to buyers who earn $25,000 a year.
“We see this in the context of a much larger economic and social crisis in Canada,” Power said.
As maxed-out prospective buyers flee exorbitant prices in the GTA, values have increased in Hamilton. In November, the average sale price was $545,690, the Realtors Association of HamiltonBurlington found.
JvN/d isn’t the only developer trying to bridge gaps between rising real estate and outstripped incomes. Options for Homes has built 3,500 condo units in Ontario since it was founded in 1992.
“We’ve had a huge increase in demand,” CEO Heather Tremain said.
The non-profit also helps buyers with down payments. When owners sell, they pay the agency back plus a share of appreciation.
The model is self-sustaining, making it more nimble than nonprofits that must wait for government funding to build, Tremain says. Options for Homes is mostly focused on Toronto but has a presence in smaller centres such as Milton, Cambridge and Guelph.
“We hope to have a project in Hamilton before too, too long.”
The traditional middle class is struggling more and more to enter the housing market, notes Jeff Evenson, a director at the Canadian Urban Institute.
“How do we build without enormous amounts of government subsidy, which it’s not there, in this day and age?”
This is where models like JvN/ d’s Hamilton project, Options for Homes and other agencies in cities across the country come in, Evenson suggests.
But filling the gaps, especially in growing areas such as the Greater Toronto and Hamilton Area, will be challenging, he says.
“To meet the need, we’re going to have to scale up quite considerably.”
Government can be most effective by helping agencies access capital to be paid back later, Evenson says.
Ward 2 Coun. Jason Farr says he appreciates how van Nostrand and JvN/d have reached out to North End residents.
“He is aggressive and thinking outside the box on this one.”
But Farr says it’s “still left to be determined” if the approach will work in the North End.
There’s “certainly” no planning policy for the unorthodox project, he adds. Evenson says municipalities need to be open to new approaches to figure out ways to solve the affordability crunch.
“The pace of change is happening faster than the ability of the regulatory framework to keep up.”