There are over 660,000 renter households in B.C., making up a full third of the population. This volume means finding affordable, stable housing as a renter can seem like an almost insurmountable challenge. Despite the provincial government’s significant investments and progress in expanding the rental housing supply, the demand still far outweighs the available options. As we work toward long-term solutions, it’s time to explore more innovative ideas, including the concept of shared equity for renters.
Since 2017, B.C.’s historic investment in housing has significantly reduced the unmet need for rental homes. Non-market rental builds are increasing, and rents are now softening in some major cities, even Vancouver. But so much more work needs to be done. Estimates say B.C. needs to build 12,500 new affordable rental homes per year until 2034 to fully meet the demand.
That’s a daunting figure, but our politicians appear to be encouragingly committed. They are also committed to protecting existing rental homes. The recently established $500-million Rental Protection Fund has allowed non-profits and co-ops to acquire nearly 1,500 rental homes since January 2023, with the potential to preserve up to 2,000 homes annually. This effort helps protect renters from the threat of eviction and speculation-driven rent hikes, but it doesn’t address the larger issue: renters’ lack of equity and long-term stability in their homes.
The Case for Shared Equity: A Win-Win Solution
In a province where housing affordability is one of the most pressing issues of our time, shared equity presents a powerful solution. Shared equity models offer renters a stake in the homes they occupy, allowing them to benefit from the appreciation of the property’s value over time. This approach doesn’t mean that renters would fully own the property—rather, they would gain a small percentage of equity, aligning their interests with those of homeowners and investors.
Why is this important? Because for too long, renters have been excluded from the financial benefits of homeownership. In today’s market, where home prices have surged dramatically, renters are often left behind, paying ever-increasing rents while housing wealth continues to accumulate in the hands of a select few. Shared equity could change that dynamic by giving renters a financial foothold in the housing market, even if they never fully own a home.
Shared equity would allow renters to build some level of wealth through property appreciation. Even a small share of a home’s equity would provide renters with long-term financial benefits, helping to close the wealth gap between renters and homeowners. Also, when renters have a financial stake in their homes, they are more likely to stay longer, reducing the high turnover that often destabilizes communities. This creates stronger, more cohesive neighborhoods.
The idea that renters are somehow less a part of the fabric of a neighourhood or town is outdated. That mindset doesn’t apply in the middle of the worst housing crisis in generations. Protections, as well as equity, need to be extended to this growing class. It’s not a transient class – in large part, it’s the middle class, which any strong society must protect and nourish. With a wealth gap that only continues to grow exponentially, this society is clearly not living up to that promise.
In a market plagued by speculation, where housing is a commodity, not a basic human need, shared equity could help temper the speculative nature of real estate. When renters have an ownership stake, the pressure to flip properties for quick profit decreases.
When the provincial government develops affordable housing, it could implement a shared equity program with renters, offering a percentage of equity as part of a longer-term lease agreement. These partnerships could help finance the construction of new affordable rental housing while providing renters with a chance to gain equity.
B.C. also has a strong tradition of co-op housing, which could be expanded to include shared equity programs. By allowing renters to buy into a small portion of their co-op unit, co-ops can offer both affordable housing and a path toward wealth building.
The government could offer incentives to developers to include shared equity provisions in their rental projects. These incentives might include tax breaks, density bonuses, or fast-tracked approvals, encouraging more developers to adopt the model.
B.C. has made commendable progress in addressing the housing crisis – but to truly tackle the issue, we must think bigger. Shared equity offers am opportunity to give renters more than just temporary shelter—it gives them a stake in the future.
As we continue to build the 125,000 affordable homes necessary to meet the growing demand, we must also build systems that allow renters to share in the prosperity that housing can provide. Shared equity could help ensure that B.C.’s renters, and its middle class, find a path to financial security.