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Economic and social impacts of subsidized rental starts in the greater Vancouver area, 1975-1985

University of British Columbia

During the early 1970's to mid 1980's, the Federal Government introduced seven programs aimed at stimulating rental housing construction. Three of the programs characterized a market-welfare approach to housing stimulation (the Multiple Unit Residential Building Program, the Assisted Rental Supply Plan and the Canada Rental Supply Plan). The remaining four characterized a social-welfare approach to housing stimulation (the Section 15.1 Non-Profit Program, the Section 34.18 Co-op Program and the Section 56.1 Non-Profit and Co-operative Housing Program). This thesis investigates some of the economic and social impacts of these market- and social-welfare programs in the Greater Vancouver Area between 1975 to 1985. Four categories of economic impacts are analyzed: rental stock growth, economic displacement, multiplier effect and employment generation. In terms of social impacts, two categories of local community impacts are examined: those attributable to the characteristics of households occupying program housing and those attributable to program housing location (i.e. single family areas, medium to high density areas and areas of gentrification). This does not mean that all the economic and social impacts of these programs are discussed. Rather, only a sample of each are examined from which suggestions are made as to the economic and social impacts in their entirety. Furthermore, calculations of the monetary cost of each program and between program comparisons of efficiency are not within the scope of this research. While this research makes extensive use of Greater Vancouver Area empirical data, national averages and research based on other areas of North America are also used. It is assumed that the resulting errors are minimal. The thesis research suggests that in relation to the social-welfare programs, the economic and social costs associated with the market-welfare programs were extremely high. The market-welfare programs produced 23,169 units for a direct and indirect multiplier effect of over $600 million and 20,284 man-years of employment. The social-welfare programs produced 12,662 units and 2,653 beds. The units alone resulted in a direct and indirect multiplier effect of over $550 million and 11,055 man-years of employment. (Due to an oversight, the multiplier values are not in constant dollars and therefore cannot be compared. However, unlike the social-welfare programs, the economic performance of the market-welfare programs was affected by economic displacement. Taking into account displacement, the market-welfare programs produced only between 15,489 and 17,793 units, for a direct and indirect multiplier effect of between $434 and $484 million and an employment generation effect of between 13,561 and 15,578 man-years. Furthermore, the rental status of the market-welfare units is threatened by condominium conversion. Social costs also appear to be limited to the market-welfare programs. In areas of gentrification, the market-welfare programs resulted in household displacement and affordable housing destruction, and there is the potential for mass household displacement through the condominium conversion of market-welfare units.

Text

2010-09-24

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http://hdl.handle.net/2429/28673

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University of British Columbia

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