‘It’s a pretty big dream’: City could relaunch a long dormant program to help renters buy their first home

City staff want to revamp Affordable Home Ownership Program that loans out money to help people purchase a house. Bryan Bicknell reports.

What’s old is new again at London City Hall, at least when it comes to home ownership. City staff are proposing the relaunch of a program that helps middle income earners buy their first home.

“It’s a pretty big dream. It’s kind of priority number one for us. We really want to get our own place,” said downtown apartment dweller, Dave Lewis.

Lewis and his wife have rented for the last 18 years, but he said they’ve outgrown their place and now want a home they can call their own.

But while they both work, they don’t earn quite enough money to buy the type of house they’d like to get into.

“There are so many factors. The housing market, banks, interest rates for banks getting into getting a proper mortgage. Being able to compete. Lack of availability,” said Lewis.

City staff is proposing the re-introduction of The Affordable Home Ownership Program. It would assist renters and first-time buyers in London and Middlesex with down payments and closing costs in the form of a forgivable loan.

London Deputy Mayor Shawn Lewis said it’s an opportunity worth considering.

“It does have an impact in terms of our housing waitlist, our roadmap to 3,000 affordable homes because it frees up rental stock, and that has been the single biggest driver of housing affordability in our city for the last six, seven years,” explained the Deputy Mayor.

The original home ownership program went from 2008 to 2013, when market conditions at that time forced the closure of the program.

It was funded by the provincial and federal governments. In five years, it issued 270 loans, lent out $2,317,466, discharged 173 loans, and received $2,443,010 million in repayments.

There are currently 97 remaining loans, which will reach maturity between 2025 and 2033. The Revolving Loan Fund now has a balance of just under $3.1 million, which would be used to restart the program.

“It really is kind of a use it or lose it. I mean, we can leave it sitting there, but we can’t use it for other things,” explained Deputy Mayor Lewis.

Eligible households in the relaunched program would be offered interest-free loans over 20 years, covering up to five per cent of the home’s purchase price, to a maximum of $25,000. Those eligible cannot earn more than $95,000 annually for a single, and $115,000 annually for a family.

“That’s part of the thing where we would like to be able to build equity with a property, and with renting, that’s just not possible,” said Dave Lewis.

The city said while the market has stabilized, the average home price does not match the average income.

Citing figures from realtors.ca, city staff said there are roughly 450 homes in London and Middlesex in the $320,000 to $500,000 range, which would fit the program.

The proposal goes to city council’s Community and Protective Services Committee on Monday.