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WHA to host housing forum to answer questions, provide insight

Employee housing sold for less than asking price
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Housing authority GM Marla Zucht and board chair Gord McKeever in front of Nitat Lake employee housing site. Photo by Alison Taylor

For the first time ever an employee housing unit has sold for less than its maximum resale price.

Employee housing owners have always been offered top bucks for their homes… until this week, when the owners of a Bear Ridge townhouse accepted an offer $5,000 less than the $450,000 asking price.

Whistler Housing Authority general manager Marla Zucht said the situation is a bit of an anomaly because the unit is bigger than most three-bedroom units in the inventory at 1,700 square feet.

At the same time, she’s been expecting this to happen as employee housing projects tied to the Vancouver market climb out of reach for some Whistler employees — this price-restricted unit has appreciated 47 per cent ($143,000) since it was built four years ago.

“We’ve been waiting for it and expecting it to happen,” said Zucht, of the sale which was finalized Tuesday. “This is telling us that we’re hitting the purchase price threshold for people that are on the waitlist for these units.”

This is one of the reasons why council, based on the WHA board’s recommendation, unanimously voted to standardize all appreciation formulas in the housing inventory upon resale and for any new units coming on board.

Once sold, this Bear Ridge unit will only appreciate at the Core Consumer Price Index (CPI) rate, a modest 2 per cent annually.

This appreciation is more consistent with the philosophy behind employee housing, said Zucht.

“It’s a home ownership (opportunity); it’s not an investment,” she said. “The provision of a home is more important than the return on investment. That’s foremost.

“There are trade-offs for living in this beautiful resort community.”

But to Shelley Quinn, who owns a unit in 19 Mile Creek that is also tied to the Vancouver market, it feels like the WHA is pulling out the rug from under her feet.

Quinn, along with other owners in the development, says the WHA has changed the rules of the game on them, and they’re determined to fight those changes.

“When we purchased in 19 Mile there were certain premises that were in place, such as the appreciation formula,” said Quinn.

“We were investing into a home and basically that’s being disregarded.”

The appreciation formula, unique to 19 Mile, Bear Ridge and the Beaver Flats duplexes, was a selling point for Quinn who saw it as a chance to recoup some money on their investment. They would not have bought the unit, she said, had it been tied to the CPI. In fact, they were looking in Squamish but the Vancouver appreciation formula at 19 Mile was a selling point; not only could they remain in Whistler, they could also make some money.

“We all love the idea of the housing authority and we’re all appreciative of the fact that we were able to buy in Whistler,” said Quinn.

“We’ve all invested our lives in this town so to be made to feel like we don’t really own our homes but we’re just kind of living in them and things can be changed randomly, it’s quite unsettling.”

A petition has been circulating at 19 Mile calling on council and the WHA to reverse their decision and reinstate the old appreciation formula.

Quinn will be expressing these concerns at the WHA public forum Wednesday.

The public forum has been organized to address these concerns.

Employee housing owners feel they were not canvassed for feedback on the formula change in the weeks leading up to council’s decision, another concern among some homeowners.

An e-mail was sent out to all employee homeowners and waitlisters in October canvassing feedback on a new appreciation formula. It was not clear at the time, however, that the formula would apply to all units upon resale.

This was the only outreach to the community and it drew 44 responses, almost half of which were in favour of the change.

“The feeling, right or wrong, amongst owners was that public consultation wasn’t there,” said new WHA board member Grant Cousar, who owns in Bear Ridge.

Cousar was brought on to the board last month to represent employee housing owners and their concerns at the board table.

Because changing the formula has never been done on existing inventory before, he said there is concern about the ramifications of this decision for owners, both in the short term and long term.

For example, the unit just sold at Bear Ridge will now appreciate much slower than neighbouring units. Five years from now there could be two identical units up for sale at two very different price points. Those selling for a higher price will be at a distinct disadvantage.

“There’s a lot of speculative concern,” said Cousar of the feeling among fellow homeowners.

Six units have been sold since council adopted the new formula and Zucht said it hasn’t been a major concern among buyers and sellers.

Speculation on several aspects of employee housing is on the minds of many Whistlerites now as the resort reaches a pivotal moment. Hundreds of employee housing units are in the pipeline with the development of the Rainbow lands in the north end of town and the athletes’ village for the 2010 Olympic Games.

The waitlist for housing has been climbing steadily over the years and sits at more than 500 individual housing applications.

Meanwhile, wildly escalating construction costs are driving up the prices of “affordable housing.”

For the most part, Whistler’s employee housing program, which has chartered new territory over the past two decades, has been a success story.

Hundreds of people are housed in the units, giving them a chance to stay in Whistler, raise a family and establish roots here. They keep the community vibrant and make the town not just another ski resort but a thriving resort community.

“I think there is a good understanding of the need to have a separate housing inventory in Whistler,” said Zucht. “Our price-restricted product comes on at about a quarter of the prices of what market housing is. And when we look at household incomes and what people can really be affording in the community, the regular housing market has failed them essentially.”

One of the central tenets to the employee housing experiment in Whistler is that housing must not be affordable for just one generation.

Whistler learned that lesson the hard way. The Lorimer Ridge project of the early ’90s is a classic example.

Despite heavy lobbying of the local government at the time, council of the day chose to move the project ahead with occupancy restrictions only and no price caps.

In 1993 the Lorimer Ridge lots sold for between $55,000 and $65,000 and the single family homes were worth between $200,000 and $250,000.

Last month one of those homes sold for more than $1 million — roughly a 400 per cent increase in 13 years.

“In hindsight, in looking back at them, they really only benefited the people that got in it the first time,” said Zucht. “So we learned from that and said ‘this has to be a legacy.’

“That affordability needs to be passed on through generations so that we’re not only looking after ourselves right now but we’re looking down the road to ensure that this inventory is still available, accessible, affordable.”

And so, in subsequent projects, beginning with the Millar’s Ridge Townhouses, employee housing projects were tied to a capped appreciation formula. The idea was that while market housing boomed and got too expensive for people, this second housing market would meet the demand for employees; regular working people making a regular working wage.

Two different formulas were used to determine how the housing would appreciate — one tied to the Prime Rate, which has gone up roughly 1.5 per cent per year, the other tied to the Greater Vancouver Housing Price Index (HPI).

“Like so many other things we’ve done in Whistler there’s no manual for this, there’s no instruction book — we’re writing it,” said WHA board chair Councillor Gord McKeever.

“Sometimes the world changes around us and challenges some of our basic premises.”

The world changed recently with the housing boom in the city and the ripple effects of that boom were felt in Whistler’s employee housing market.

On Monday there were four waitlist applicants looking at the Bear Ridge unit even though 41 invitations were sent out to people on the waitlist.

Last month when a one-bedroom unit in Spruce Grove, which is tied to a 1.5 per cent prime rate appreciation formula, went up for sale 20 parties showed up for the sale. Between 25 and 30 parties were invited.

Zucht said the cost of Bear Ridge at $450,000 (or $261 per square foot) affected the turnout. The new Nita Lake employee housing project sold to waitlisters in March at $192 per square foot.

“We are hearing from people on the waitlist and in the community that they can no longer afford some of the units that have been escalating quickly,” said Zucht.

Quinn argues, as do others in the community, that there is a need for different levels of employee housing price-points to suit different needs. And some people would like to see more of a return on their investment, particularly when they’re investing hundreds of thousands of dollars.

“To have a healthy economy and to attract the type of people that I think Whistler needs… it’s better to have a tiered system anyway,” she said.

“We wouldn’t have bought had it been at CPI and I think Whistler stands to lose a lot of good people if the housing authority keeps taking away the rights of people that are buying.

“There comes a point where you have to invest your money somewhat wisely.”

This, along with many other things, is likely to be a part of the discussion at next week’s housing forum on July 19. The forum will run from 7 to 9 p.m. All are welcome to ask questions and air their concerns at the Westin Resort & Spa in the Emerald A room.

Housing issues are also likely to be brought up at council’s next meeting on Monday, July 17.