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Toronto will not be a prosperous city until all of the people are prosperous. As visitors step over sleeping street people to enter a business meeting, the separation between rich and poor becomes apparent. Shifting to a city where everyone is abundant involves the participation of all, but the municipal government could certainly move things in the right direction.
The largest landlord in Toronto happens to be the city itself, owning over 58,000 houses rented to tenants receiving social assistance. There are also another 32,000 units that are funded by the city, but this is not enough. Currently the waiting list for social housing exceeds 66,000. The most direct answer of course is to build more social housing units.
I plan on taking a different approach. Of the thousands of individuals and families that are living in social housing, it is possible that many could support their own house if given the chance. Home ownership builds pride, confidence and security. Wouldn't the city be better off if a few thousand families moved out of social housing and into their own homes, leaving units vacant for those on the waiting list?
What if the city of Toronto (and all surrounding regions) allocated a percentage of municipal-owned land for the building of housing units? Instead of selling the land, it would be leased to condominium corporations that operate housing developments of twenty to forty units. Because land costs have been eliminated, the main costs of construction could be held to $100,000 per unit. A markup of $25,000 would be used to cover infrastructure costs such as sewers and roads. Eligible families or individuals would buy these affordable houses, and would then be paying off a low-interest mortgage. Approximate mortgage costs to the homeowner would be about $700 per month for a three-bedroom house, which is less than the rent that some are paying.
There are many benefits to this plan. Many families get their own house, and many units would be vacated for new tenants. The plan would utilize city land that is unused or in disrepair, and would result in a net profit for each project. Since the houses are assets to be sold, the financial responsibility of the city will simply be cash-flow management. Spend money now, help thousands of people, and get your money back. Sounds reasonable to me.
So how do we arrange for these people to get mortgages? The simple answer is this. Current interest rates on savings funds are 2.5%. The city would invest money into a bond fund called 'The Toronto Housing Advancement Fund', and receive 2.5% interest. The public and other governments would be encouraged to also invest in the fund. An administrative charge of 1% would be added, and mortgages given to the new homeowners at 3.5%.
If only ten percent of the investments held by Toronto were allocated to this fund, we could put 2000 families into their own homes each year. If the regions around Toronto got involved in the same program, we could help 10,000 families each year.
Of course, this program would only help some of the people. There are many more people with many more needs. But what is important is to start a program that both provides for immediate needs and offers a pathway to abundance. The elimination of poverty in society requires many steps, and this could be one of them.
© Copyright 2006 Glenn Stewart Coles
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