Toronto Community Housing Corporation is selling 20 houses that could fetch $8.6-million on the market to another affordable housing provider for about $400,000. TCHC describes the transaction as a “cost-effective” option, but it raised enough questions for Mayor-Elect Rob Ford to meet with TCHC on Sunday. The Post’s Natalie Alcoba takes a look at the deal.
Q Where are the houses?
A The three-and four-bedroom dwellings, most of which are vacant, are scattered throughout the core of the city, in wards 21 (St. Paul’s), 29 (Toronto-Danforth), 30 (Toronto-Danforth) and 32 (Beaches-East York). They are in need of repair, with the TCHC estimating that each would require $30,000 to $40,000 worth of upgrades. TCHC owns 550 single-family homes.
Q Why is the TCHC selling these houses?
A Toronto Community Housing is transferring the 20 properties to Wigwamen, an aboriginal housing provider with a mandate to provide shelter for people who are homeless or at risk of becoming homeless. The sale is part of a larger plan by the TCHC, the largest social-housing provider in North America, to offload some of its stock, thus relieving it of costly maintenance obligations. Forty-seven single-family dwellings are up for sale. In a press release, the TCHC described the deal as one “that support efforts to keep the organization on a sound financial footing while maintaining affordable housing for low-income Torontonians.” In August, the city approved the sale of five homes on the market and is reviewing proposals from community agencies to assume the remaining 22.
Q What is the math on the deal?
A TCHC estimates that each house is worth $430,000. That means the properties could pull in as much as $8.6-million. Instead, city council earlier this year signed off on a deal that will see the houses sold to Wigwamen for the outstanding cost of the mortgages, ranging from $22,481 to $64,121 each. Eight of the houses are financed with debentures, and will therefore pass hands for free. As the new owners, Wigwamen will be responsible for $1.2-million in required repairs over the next 10 years, most of that covered through federal funding. Had TCHC sold the houses, it says it is required by law to replace the subsidized housing units, which would cost $3-million more than the sale pulls in. Replacement costs totalling $11.6-million include commissions, demolition, construction, planning, design, fees and the cost of land, TCHC said in a press release.
Q Are there any options?
A Kevin Sullivan, manager of social housing policy for the Ministry of Municipal Affairs and Housing, said the city does have some “flexibility” when it comes to its stock of affordable housing units. It is required to “maintain service levels,” he said, and that “could be through rent supplements, new units being created or adding additional units to another housing provider.”
Q What is the Mayor-Elect doing about it?
A Rob Ford’s chief of staff, Nick Kouvalis, confirmed that the Mayor-Elect met with the CEO of TCHC, Keiko Nakamura, on Sunday and was briefed on the sale. “It was a very informative meeting and Mayor-Elect Ford appreciated the opportunity to hear the facts first-hand,” Mr. Kouvalis wrote in an email. “Mayor-Elect Ford looks forward to sitting down with TCHC again after he takes office to discuss options to manage similar circumstances in future.” Earlier in the week, Mr. Ford told the Toronto Sun he wanted to ” find out why (TCHC) is giving these away at this kind of price. It’s a lot of money we could be getting, or losing, either way you look at it.” He did not comment on yesterday’s meeting.
Questions & Answers: ‘Cost-effective’ new sell-off plan gets Ford’s attentionIn Canada on November 1, 2010 at 20:43