December 11, 2013
Province Creates New Financial Incentive for Construction of Affordable Rental Housing
– – –Private Sector Developers Have Important Role in Helping Low-income Manitobans: Minister Howard
The Manitoba government’s new construction tax credit is now available and is expected to help private developers build more affordable rental housing for low-income households, Finance Minister Jennifer Howard said today.
“We want to encourage developers to build more rental housing that includes a mix of affordable housing,” said Minister Howard.
“We announced the tax credit in Budget 2013, which follows recommendations by community groups and participants in the Rental Housing Roundtable,” said Housing and Community Development Minister Peter Bjornson.
The rental housing construction tax credit is a new financial incentive for private and non-profit housing developers, including non-profit co-operatives, building new rental housing. Developers can offset their investments through a tax credit of up to eight per cent, to a maximum of $12,000 per unit.
“Winnipeg Realtors was pleased to be a member of the Rental Housing Supply Roundtable, whose mandate was to offer recommendations to help alleviate the affordable rental housing crisis throughout Manitoba,” said Mel Boisvert, a Winnipeg Realtors spokesperson and co-chair of the roundtable. “I am pleased that the initiative for the province’s rental housing construction tax credit is rooted in the recommendations of the roundtable. It’s an important step in working toward providing Manitobans with more affordable rental housing options.”
To receive the tax credit, at least 10 per cent of the new units must have affordable rents, which will benefit households at the lower end of the income scale. Affordable rents are established by Manitoba Housing and Community Development and are based on localized median market rents across the province.
The housing project must:
- be new construction (or converted from non-residential use);
- have five or more units;
- be in receipt of a building permit on or after April 16, 2013;
- be located in Manitoba and ready for occupancy before 2017; and
- not provide accommodation on a transient basis.
Changes to provincial legislation will be introduce that would put in place income limits for tenants renting the affordable units, as well as a requirement that landlords not rent units designated as “affordable” to family members, Minister Bjornson said.
During the next three years, the Manitoba government will invest $100 million annually to restore and redevelop housing units in its portfolio, he said, adding an additional $34 million will be dedicated annually to repair existing stock and provide quality home environments for tenants.
Manitoba will also build 500 more social housing units and 500 more affordable rental units over the next three years. This is in addition to 1,500 social housing and 1,500 affordable housing units on schedule for 2014.
These investments to build more affordable housing are in addition to increased benefits for employment income assistance recipients and other low-income Manitobans announced in Budget 2013 through an annual increase of $6.3 million in RentAid shelter benefits.
More information on the new rental housing construction (RHC) tax credit is available at: www.gov.mb.ca/housing/rental_housing_tax_credit.html.
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