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Council approved several changes to the wording of some programs created in 2020 to make it easier to get financing for prospective first time home owners.
Some of the wording led banks deny mortgages to those accessing the program.
“The wording specifically caused lending banks to see it as a contribution to the mortgage,” Coun. Dawn Kilmer said during the Jan. 25 regular council meeting. “By changing this program we’re hoping to enhance the people that wish to become homeowners.”
Seven of the City’s eight councillors approved continuing the program with some changes, despite a lack of uptake since it was created. Coun. Tony Head was the only elected official to oppose it.
“It’s the availability of just a little boost to help them become first time homeowners,” Kilmer said.
Applicants can get 50 per cent of their needed down payment to a maximum of $5,000 or they can get funding up to $2,000 for closing costs.
A third avenue is to ask for grant funding that will pay for significant or immediate home repairs. The money would cover one-half of the cost of the work up to a maximum of $5,000.
Work such as replacing or fixing a furnace, secondary heat source, water heater, shingles, windows and wiring are examples.
In the proposal to council, staff explained that the changes shift the focus from a specific type of applicant to moving people through the ‘housing continuum’.
The maximum value of eligible home is $200,000 and household income is capped at $80,000.
As Craig Guidinger, Director of Planning, explained, people that can save money for a down payment sometimes have problems paying for large repairs.
“Anecdotally, we have talked to a lot of lending agencies and they have told us that people save for a down payment – they can save for a home but its either/or,” he explained. “They don’t have money for a down payment and money to replace a furnace or replace shingles on their property. They have said that a program like this certainly does help.”
Coun. Tony Head, who voted against the changes, discussed using some of the money in the housing reserve for areas, such as a $10,000 grant to the newly expanded overnight shelter being operated by the Prince Albert Grand Council.
He said the uptake on the program was limited, pointing out that no actual applicants met the criteria.
“I don’t know how many people are going to apply for or qualify for these programs, even with the changes,” he said.
Some councillors expressed concern over what they called downloading of responsibility from higher levels of government, such as the province or the federal government.
“If the birth of this program is a result of the province stepping away, I‘m concerned about us filling the void, us filling the gap. If we continue the practice of filling in the void every time another level of government walks away from an existing program, frankly we can’t afford anything to fill the void,” said Coun. Ted Zurakowski. He said that the program fills a need in the community.
Coun. Dennis Ogrodnick had similar concerns, but said that helping people become home owners has long term benefits to the City.
“A first time home buyer is finally going to get their own place. They are then going contribute in the form of taxes back to the city. It’s a small investment on the part of the city to get and to build our tax base,” he said.
“The renovation is the same thing. If we’re going to approve properties that are run down, it’s going to improve the assessed value of that property by investing into those neighbourhoods. We will see the return in the long run.”
At the recommendation of staff, the secondary suite program was discontinued.