BANFF – A $13.2 million price-restricted affordable apartment housing development is going ahead in Banff.
Town of Banff officials say they are confident the 33 units to be built on the 300 block of Banff Avenue will sell even in the face of the COVID-19 pandemic, which has left local businesses struggling and people out of work.
Councillor Corrie DiManno said she is pleased the Banff Housing Corporation team went back to survey the community to give council the confidence that there is still a need for a for-purchase development despite the pandemic.
“COVID is definitely a humbling reminder that we can’t predict the future and certainly there is risk with every project we do in the Town of Banff,” said DiManno, who sits on the Banff Housing Corporation.
“The information we’ve been given, the indicators we have about home sales during the pandemic, give me confidence that these are needed today and they’re going to be needed two years from now,” she added.
“This is about long-term sustainability of our community and it’s going to be a watershed moment for so many people in this town that will be able to become homeowners and will be able to stay here.”
At a meeting on Tuesday (Oct. 13), council directed administration to issue Studio North & Lola Architecture a letter of intent to finalize drawings and start the approvals and construction process for 338-342 Banff Ave.
Administration will also return to council with a borrowing bylaw for the affordable housing development.
“The borrow is a three-year, short-term based on the anticipation of unit sales,” said Sharon Oakley, the Town of Banff’s housing sustainability manager. “The project would not be taxpayer supported.”
The unit sizes range from one-bedroom at 550 square feet to three-bedrooms at 1,220 square feet.
A snapshot of the financial implications for potential homebuyers shows a one-bedroom with 10 per cent down equates to about $265,000. At a three per cent mortgage rate for 25 years, the monthly payment would be about $1,250.
“The annual income needed to purchase that, with a 10 per cent down, is around $45,000,” said Oakley.
“A two-bedroom using that same methodology is $405,000. At three per cent down for 25 years, their monthly payments would be around $1,900 and the income needed to support that kind of a mortgage is around $70,000.”
Given the COVID-19 pandemic and its potential to have changed personal circumstances regarding home acquisition, administration did another housing survey in July, specific to the Banff Avenue project.
They survey indicated that 173 respondents were still interested in purchasing a unit in the next 24 months despite the coronavirus pandemic.
It also showed that 159 respondents had a gross income of between $40,000 and $80,000, while 136 respondents had a gross income of between $80,000 and $120,000.
“All the incomes support the purchase of these units based on a 10 per cent down payment, and based on their mortgage payments not being more than 30 per cent of their income,” said Oakley.
Based on conversations with local Realtors, Oakley said Banff’s housing market has been active throughout the COVID-19 pandemic.
She said there have been six comparable sales in the private market and five home sales within the Banff Housing Corporation portfolio.
“This is not reflective of all the regular sales in the regular market; these are just ones that are comparable to what we are about to offer potentially on Banff Avenue,” she said.
“Banff realtors have expressed through conversations that the prices in the condo apartment market remain strong and the sales have also remained strong throughout the pandemic.”
Studies indicated the projected housing shortfall in Banff is estimated be 723 units by 2027.
The goal is to start construction of the Banff Avenue development next March or April, with plans for full occupancy by fall 2022.
Councillor Chip Olver was uncertain about moving ahead with the project before Tuesday’s council meeting, given the fallout of COVID-19 on the community.
“With the presentation and the report, I feel confident that we can and should go ahead with this.”