The federal government has pledged a low-interest loan of $1.4-billion to help a Vancouver-area First Nation build affordable rental apartments in a massive development on the shores of the city’s inner harbour.

It is the largest loan the Canada Mortgage and Housing Corp. has ever given for a development.

The government said the 50-year loan – funded through a special program in its National Housing Strategy – will create affordable housing, but is being offered under rules that housing experts say would allow rents that are too high to be called affordable.

Earlier this year, the federal government promised to overhaul the criteria for defining what is affordable in such projects, but those new rules have not yet been applied.

The April 7 budget said the reform of the Rental Construction Financing Initiative would “ensure that rental units built through it are more affordable.” It included a goal to have “at least 40 per cent of the units it supports provide rent equal to or lower than 80 per cent of the average market rent in their local community.”

The old criteria require developers to designate only 20 per cent of the apartments as affordable and the rents permitted will be geared to household incomes, not local rents.

Keep reading in The Globe and Mail

• 
•