For some reason the conversation about affordable housing has left co-operative housing off the list. Instead, new home buyers and young people keep getting hammered over and over by government policy that keeps them out of the real estate market rather than open any doors.

Conservatives and liberals alike seem to agree that tightening up access to insured mortgages for lower income families is the best way to respond to an over-inflated real estate market – even though these tactics have failed repeatedly over the last 10 years.

For the last 5 years, it has been commonly known that foreign investors in Richmond and the lower mainland of Vancouver have driven both the race to the top house prices in the country and the dramatic fall to the bottom of rental vacancies. After repeated denials by realtors and governments, the obvious finally gained official acceptance in 2016, drawing attention to the plethora of empty investment houses scattered around the city and the creation of new policies aimed at curtailing foreign investment with new taxes. Even the taboo of publicly speaking about money-laundering broke through the long silence of avoidance.

Then, suddenly, out from Ottawa, comes a new policy with an old face scarred by repeated failures announcing new restrictions for access to government-insured mortgages. The matter of home purchases by wealthy foreign investors got a respectable mention but the gloves came off with struggling young middle to lower income families trying to find a way out of poverty by buying a home.

The main thrust behind the new policies is to protect lenders from any risk. Home purchases will need at least a 5% down payment but will be subjected to a mortgage stress-test that will likely result in higher interest rates for new home buyers. We seem to be rapidly moving in the direction of only granting mortgages to the wealthy. (For further information see: Four major changes to Canada’s housing rules, The Globe and Mail Published Monday, Oct. 03, 2016.)

Affordable housing for middle and lower income families slips through the fingers of policy makers once again. Why can we not develop policies that focus on getting people into housing rather than protecting lenders?

Co-operative housing at one time in Canada basically did just that. Allowed people to have affordable housing where rents could be determined by income after purchasing a membership share.

That is what is needed today. Governments could easily revive the old concept of co-operative housing but modernize it to respond specifically to affordable housing issues in Canada’s major urban centres. For example, crown land could be developed and government(s) hold the mortgage on the strata lots. People could then purchase a share to become a member and then have their rent determined by their income and not to exceed 30% of the member’s net income.

This 30% rate is based on past practices not the modern ones that have increased over the years to 39% or more of the gross income. Basing affordability on gross income has never been practical. Gross income is a fictional figure for a family because they only receive the net income after non-discretionary deductions like taxes.

It has been my professional experience (28 years) that if the percentage of income devoted to shelter increases above the net 30% level, people rely on credit to make ends meet.

The governments could tackle two problems instead of one – affordable housing and reducing the rise of already worrisome household debt levels.

The strata lot could be operated similar to strata complexes today with elected strata councils and independent property managers.

Participants in these units would forfeit any equity growth but would enjoy modest rent until they could save up enough to perhaps purchase a home later.

Co-operative housing may no longer be the right term as the emphasis should be on affordable housing units. Perhaps rent to income housing would be more accurate terminology.

No doubt it is time to get out of the box of conventional wisdom and stop doing the same old things even when they don’t work. That way we can stop dreaming about affordable housing, and make it actually happen.