Applications have been flooding in for a new affordable housing project opening soon in Amherst.
The Groves at Hillsdale is a new housing community born from a partnership between United Way Maritimes, The River Philip Foundation, The Shaw Group, and the town of Amherst.
The plan for the Groves includes 47 residential units, 19 available as rentals, and 28 available for a special shared equity style home ownership. 22 of the units will be ready in the coming months, and so the United Way Maritimes recently put out the call for applications for 12 rental units and 10 home ownership opportunities.
Sarah Flemming is the rural affordable housing advisor for United Way Maritimes, and says the group received 200 applications for the 12 affordable rental units, and 20 people have shown interest in the 10 homes available for ownership. Flemming says applications have come from Amherst, Cumberland county, Sackville, and as far as Moncton and Halifax. But the project will prioritize people “that either live in Amherst or work in Amherst currently, or have ties to that community,” says Flemming.
To qualify for the ownership option, households must have incomes in the range of about $50,000 to $80,000, and should live or work in Cumberland County. The program uses a modified shared equity model, which allows new owners to forego a down payment in exchange for the United Way retaining partial ownership.
“The way things are set up right now in the world we live in,”says Flemming, “owning property is really a way to build generational security and build equity and all of those things.”But the opportunities for owning property have been shrinking, she says, thanks to increasing debt loads and staggering increases in housing prices.
“When you’re paying 50% of your income to rent, paying back student debt, all of the other things that come with life, the opportunity to save for a down payment and purchase a home is nearly impossible,” says Flemming. “So we wanted to create this opportunity for a modified shared equity homeownership, to allow people the opportunity to build that.”
The shared equity home ownership model means that a household will be able to buy a home without a down payment, but United Way Maritimes will keep a 25% stake in the property. That will help ensure that the homes stay affordable, even if they get bought and sold over time. When a homeowner decides to sell, they will get their equity back, plus a growth rate tied to the economy, but not the wildly volatile housing market.
“It’s more keeping in line with the rate that incomes grow year to year,” says Flemming, in the range of two to four per cent. “So it just sort of keeps that house price in line with what the expected growth of incomes would be.”
Fleming says that she is particularly exciting by the shared equity model. “It’s new, and it’s exciting,” says Flemming. “We hope that people latch on to it and see it as a way to sort of disrupt the housing market as it currently exists, just to change the future for generations.”
Municipal support was ‘the proper thing to do’
The Groves at Hillsdale is happening in part because of support from the town of Amherst, which has invested $640,000 in sewer, water and street infrastructure to help make it happen. Amherst CAO Jason MacDonald says that Amherst normally contributes to the infrastructure needed for new development, but in this case the municipality went above and beyond.
About $180,000 of the infrastructure investment from the town “we would have paid for anyway,” says MacDonald, even if it was a purely for profit, market development. But “because this was for affordable housing, entry-level housing, and they were guaranteeing that,” says MacDonald, “we agreed to pay for the entire street in order to keep the cost down.”
MacDonald says the town has also offered to refund back part of the deed transfer taxes (which would be charged twice in the complicated land deal), and also to change the municipal boundary with the neighbouring county of Cumberland.
The current Groves at Hillsdale development sits within the current town of Amherst, but on the edge of the border with the county. “Future phases, if we get that far, and I hope we do, would be in what’s now the municipality of county of Cumberland,” says MacDonald. “So the town and the county have actually agreed to change the municipal boundary, so the entire property and the entire project will be within the town of Amherst.”
In exchange for the expanded boundary, the town of Amherst has agreed to expanded sewer hookups for some county properties. “We believe it’s a win-win for both of us, and a win for the people of Amherst, which are going to get more affordable, entry-level housing,” says MacDonald.
The financial commitment to the project from the town will be offset partly by federal housing funding, but that’s something council found out about after the fact, says MacDonald.
Since the commitment was made by council, the town qualified for the federal Housing Accelerator Fund. Part of that HAF funding will pay for some of The Groves infrastructure, says MacDonald, but, “not all of it, because some of it was put in there before we knew we were getting the money.”
MacDonald says that the town of Amherst was in the position to cover the infrastructure costs out of their reserves, and while there was an opportunity cost of not being able to use that money for other town projects, staff and council felt it was worth it.
“We could have paved other streets, or we could have built a new park or something with that money, or just left it in the bank,” says MacDonald. But staff recommended and council decided, “it was the proper thing to do,” says MacDonald. “We believe that this funding was needed in order to bring all of the project partners together and make the deal happen. We believe it wouldn’t have happened without this investment,” he says.
“We knew we had a housing shortage, and especially we had a housing shortage on on the entry-level housing spectrum,” says MacDonald. “And now we’re going to have 47 new families that are in proper housing. Hopefully more future phases.”
Modular building speeds up timeline
The first 22 homes at The Groves are modular style homes built by the Shaw Group, something that Flemming says has sped up the timeline for the project, because some of the construction happens in a factory, where weather isn’t a factor.
Modular housing, she says, is helping people get housed more quickly, and it’s also attractive. “They’re beautiful,” says Flemming of modular units like those at The Groves. “We see so many different types and sizes,” she says. “I really feel like it’s a real response to a housing crisis, from tiny homes right through to market value family homes that people need.”
