Executive Summary

In 1995, the Real Estate Foundation of British Columbia identified a number of communities where selling prices and rents for housing were rising far more steeply than incomes. The Foundation invited these communities to apply for grants to study their housing situations in greater depth. Grand Forks was the second to do so.

The purpose of the study is to provide all stakeholders in the Grand Forks area with the information and direction they need to ensure that, in the years ahead, all elements of the area's growing and changing population will have housing they can afford and that suits their needs.

Changes in Population and Overall Housing Demand

• The population of Greater Grand Forks (the City and Electoral Areas C and D) may grow by more than 40 percent over the next 25 years. If so, the numbers of households will increase at an even faster rate. This is because the average size of households is decreasing. The baby boom generation is growing older and their children are leaving home. The generations following the baby boomers are staying single more often, manying later and having fewer children.
• These changes may create a demand for more than 2,000 additional housing units over the next 25 years. By far the greatest additional demand will be for: 1) housing suited to people in the 55 to 64 age group, with no children at home, and 2) housing suited to seniors from 65 on up and, especially, to ti~ose 75 and older.
• Over the next ten years, however, there will be some added demand for housing suited to people in the 20 to 29 age group, many of them with children.

Changes in Incomes, Housing Costs and Affordability

• Incomes in Greater Grand Forks are generally lower than incomes in British Columbia as a whole. We estimate that, in 1997, the median household income in Greater Grand Forks is roughly $34,300. That is, half of Greater Grand Forks households have incomes higher and half have incomes lower than $34,300.
• The evidence suggests that incomes in Greater Grand Forks are following Canada-wide trends. Across Canada, the real incomes (adjusted for inflation) of most households declined over the 15 years from 1980 to 1995. The incidence of low income (below Statistics Canada's low income cutoffs) increased. We can find no solid ground for hope that there will be any dramatic reversal in this trend. At best, there may be leveling off, so that real incomes neither rise nor fall significantly.
• The groups most prone to having low incomes are: 1) unattached adults, especially those under 24 and women of all ages; 2) single mothers with children; 3) couples with children where the household head is under 24. In Greater Grand Forks, low paying jobs with frequent layoffs are the reality for many women and young adults. So is dependency on Unemployment Insurance and Income Assistance.
• Meanwhile, the selling prices of houses have been rising steeply in the 1990s. In the City of Grand Forks, the average price of a single family detached house rose by 103 percent from 1990 to 1996. In Areas C and D, the average price of a single family detached house rose by 177 percent from 1990 to 1996. The combined average price of a single family detached house in Greater Grand Forks was $123,503 in 1996.
• Rising land costs are by far the biggest component of rising housing costs. From 1990 to 1996, the average price of a residential lot rose by 229 percent in the City and by 350 percent in areas C and D and the average price of rural acreage rose by 315 percent.
• Most local first-time buyers have been priced out of the housing market. We estimate that to buy a single family detached house with the above-mentioned price of $123,503, a first time buyer would require a household income in excess of: 1) $42,000 to qualify for CMHC's First Home Loan Insurance and 5 percent down payment; 2) $40,400 to qualify for NHA Loan Insurance and 10 percent down payment; 3) $35,300 if they had a standard down payment of 25 percent. A modest new single family detached house of 1,200 square feet on a typical Grand Forks lot would cost at least $142,000 - even further out of reach.
• The least expensive new home, a single-wide manufactured home, might cost as little as $60,000 for the unit and $200 per month for rent of a pad. The least expensive old homes in Greater Grand Forks are also manufactured homes. In 1996, such homes sold for an average of $58,343 each. Assuming they had 10 percent down payments, buyers with household incomes as low as $30,000 might be able to afford them. Some 30 percent of all Greater Grand Forks households, however, have incomes below $30,000.
• The option for people who cannot afford to buy is to rent. In its October 1996 rental market survey, CMHC identified 132 purpose-built rental units in Greater Grand Forks. From April 1990 to October 1996, average rents for one-bedroom units rose by 26.9 percent, to $396, and average rents for two-bedroom units rose by 32.7 percent, to $459. Over the same period, the Consumer Price Index for all of Canada rose by only 15.1 percent. Rents are increasing at a considerably faster pace than incomes or inflation.
• In addition to the purpose-built rental units identified by CMHC, there are approximately 600 "unofficial" rental units in Greater Grand Forks. These include single family detached houses, suites in same, duplexes, strata row houses, and manufactured homes. While no one keeps records of rents in such units, the available evidence suggests that they are generally higher than rents in purpose-built units and that their rents, too, are rising at a considerably faster pace than inflation.
• CMHC reports indicate that there have been consistently low vacancy rates in purpose-built rental units and the available evidence suggests that this has been so in "unofficial" rental units, too. Furthermore, there have been very few additions to the rental stock.
• The result is that many newcomers to Greater Grand Forks and many long-term locals with low incomes are forced to pay rents they cannot really afford for units that are often too small for their households and in other ways substandard. Some single mothers can afford only small, run-down manufactured homes, ill-suited for raising their children. Some recent arrivals can find only hotel or motel rooms, ill-suited for long-term residency.

Need for Non-Market Housing for Those with Low Incomes and Special Needs

• The residents of Greater Grand Forks are keenly aware of the current housing situation. In our questionnaire survey (with participation of 186 individuals representing 5 percent of households), 72.6 percent said that single mothers with children have problems finding suitable housing they can afford. High percentages also identified shortages of appropriate housing for, in declining order: low income people in general, people with physical challenges, young families, young singles, seniors, and people with mental challenges.
• A survey of local health and social service agencies and non-profit housing societies found: 1) a pressing need for non-market housing for single mothers with children; 2) a growing need for a variety of market and non-market units suited to seniors; 3) a need for non-market housing for low income singles and families of all sorts.

Changing Needs and Preferences for Market Housing

• Needs and preferences for market housing are being affected by: 1) changing demographics, with smaller households and more people in the 55-plus age categories; 2) economic trends, with declining or leveling incomes and rising costs of many kinds of conventional housing, due largely to the fact that increasing populations are putting upward pressure on the price of land; 3) changing values and tastes, with people increasingly in favor of conservation of agricultural and natural lands, sustainable development and smaller homes in more densely developed neighbourhoods.
• Development permit records show these changes already at work in Greater Grand Forks. In the five years from 1986 through 1990, 85 percent of development permits issued by the City were for single family detached houses. In the five years from 1991 through 1996, only 53 percent were for single family detached houses, whereas 16 percent were for manufactured homes and 31 percent were for apartments and row houses.
• Our survey of Greater Grand Forks residents found that whereas 75.8 percent of our respondents live in single family detached houses today, only 45.7 percent plan to do so when they move next. The planned move away from single family detached houses is most prevalent amongst singles and couples with no children at home, the most rapidly growing segments of the population. It is largely a planned move towards row houses, apartments and seniors' housing.
• Most of our respondents told us that, if their housing needs change, they would like to remain in their current neighbourhoods. Most also told us, however, that they would not be able to find a smaller, easier to maintain house in that neighbourhood. This helped to explain the fact that 21.5 percent plan to move away from Greater Grand Forks when they retire. Anecdotal evidence indicates that people are moving to market housing designed for seniors in the Okanagan because they cannot find such housing locally.
• Our survey listed some alternatives and asked respondents, "Given the same price, which would you choose?" Only 16.67 percent chose a serviced lot in a standard subdivision from which they would have to drive to most things and 29.03 percent chose a large, unserviced rural lot, whereas 34.95 percent chose a smaller lot, close to town, from which they could walk to most things. The smaller lot close to town was the overwhelmingly favorite choice of seniors and singles without children and also the favorite choice of couples without children. Again, these are the fastest growing segments of the population.
• Many of our survey respondents told us that they themselves could not afford to buy much of the housing available on today's market in Greater Grand Forks and that they expected affordability to be an even greater problem for their children. More than 77 percent of couples under 65 with children at home told us that when their children move out on their own they will not be able to afford the kinds of houses they now live in.
• The majority of our survey respondents told us that there is an insufficient variety of housing available in Greater Grand Forks and not enough duplexes, row houses, apartments, or small bungalows on small lots.
• Though we did not provide our survey respondents with much information on less conventional forms or housing, they told us that they were very much open to considering the possibilities. The majority were in favor of "granny flats"(small second houses on the same lots as single family detached 'houses) and apartments above garages. More than 77 percent were in favor of more than one dwelling on rural lots.
• We had the opportunity to show our slide show, catalogue and compendium of articles on alternative forms of affordable housing to only a few residents. These few responded favorably to illustrations of compact bungalows in a small lot subdivision, to a secure cluster of townhouses for single mothers with children, and to CMHC's Sprout Home, which can be converted back and forth from a single family house to a multiple apartments. Such a home is ideally suited to aging in place, since it can be reconfigured to suit a household's changing needs, preferences and economic circumstances.

Recommended Actions to Meet Needs for Non-Market Housing

• In recent years, both the federal and provincial governments have been encouraging communities to become self-reliant. Homes BC is using its limited resources (e.g., funding for only 600 new non-market units in the entire province this year) to help communities who can demonstrate that they are doing their best to help themselves with local donations of land, money, labour and materials for free or at below market rates.
• Part Nine of this report has detailed recommendations for consideration by Grand Forks Housing Society, the City and the Regional District. These include:
  1. Support for Grand Forks Housing Society, as the vehicle through which all stakeholders can work together on understanding and addressing housing issues.
  2. Support for Habitat for Humanity-Boundary Society, Abbeyfield Centennial Society and other non-profit organizations intent on implementing local solutions.
  3. Adoption of "Affordable Housing First" policies for lands owned by the City.
  4. Establishment of a community housing land trust to acquire and conserve a stock of land for non-market housing.
  5. Establishment of a housing registry to match potential low income tenants with potential landlords and to serve as a tool for monitoring needs.

Recommended Actions to Meet Needs for Market Housing

• The results of our survey suggest that the residents of Grand Forks are ready to move in the direction many other communities are taking in North America, back to the denser development that was common in the pre-automobile era. (In 1897, when the City of Grand Forks was founded, the minimum single family lot size was 2,500 square feet and a variety of housing types were encouraged, including boarding houses, bunk houses and residential hotels. In 1997, the minimum single family lot size is 7,500 square feet and bylaws make it more difficult to get permission for residential development at higher densities.) This movement is often called "new urbanism" or "neo-traditionalism" and is especially suited to a community like Grand Forks, with a fine architectural heritage firmly rooted in the nineteenth century.
• Part Nine of this report has detailed recommendations for policies that will move Greater Grand Forks in that direction and that will not just allow but strongly encourage development of the varieties of its residents will need, prefer and be able to afford in the years ahead. Recommendations include:
  1. Adoption of interim housing policies for inclusion in the Official Community Plans of the City of Grand Forks and Areas C and D, borrowing the best ideas promoted by the provincial government and contained in the housing policies of other local governments.
  2. Development of a new vision for the new millennium, starting with a series of design charettes to produce scenarios for downtown, other City neighbourhoods, the hamlet of Christina Lake, and rural areas.