City reviews policies as condominiums become more popular

At its meeting tonight, the city's planning committee will examine changes to current rules that restrict when apartment buildings can be converted to condominiums.

The current rules are in place, in part, to protect lower-income residents who can't afford to buy their apartments, and who would be affected if the supply of rental units was squeezed by a surge in the number of condos.

“The current Official Plan contains a policy that prevents the conversion of rental housing to condominium if the rental vacancy rate is less than three per cent,” says a staff report on the issue. “During the Official Plan review, it was found that there may be a need for more flexibility and broader considerations in implementing this policy.”

While much of Greater Sudbury's housing construction market has been sluggish in recent years, the bright spot has been an increase in condo construction. Projects include the renovation of the former St. Joseph's Health Centre on Paris Street from a hospital to luxury condos, as well as the conversion of a 25-unit apartment building on Lasalle Boulevard to condos.

The trend has meant there are fewer places available to rent, the report concludes.

“A recent need and demand analysis undertaken for the Housing and Homelessness Plan shows that the overall number of rented units in Greater Sudbury has decreased by nearly 2,000 units between 1996 and 2011,” it says.

While much of the decrease could be related to a drop in the number of basement or other units in family homes being rented out, the report says growth in apartment-only structures has slowed, as builders of new units are choosing condos, instead.

“In term of the primary rental market, the number of private apartment units in the Greater Sudbury CMA increased by only 1.75 per cent -- or 192 units – in the period from 2001 to 2012,” the report says.

With condominiums getting more popular in the city, the report says conversion policies have to balance the needs of landowners and renters. Building owners have been converting their buildings because it tends to increase the value of their properties, helps them raise money for other investments, and because of the high cost of maintaining rental units.

However, studies have show that “renters tend to have lower incomes and, given the lack of affordable rental, fewer choices for housing,” the report says. “Removing affordable rental stock through condominium conversions exacerbates this situation.”

While some areas of the city have plenty of apartments available for rent, the report says there's a shortage in other parts of Greater Sudbury, particularly for lower-cost units.

Elements of the revised policy could include:
-Requiring the vacancy rate to be above three per cent for a three-year period;
-Looking at the specific vacancy rates for the type of rental unit along with the specific rental market zone;
-Requirements that any outstanding property standards bylaw or building code issues be addressed; and
-Possible additional requirements when the existing rent for the subject units is equal to or less than 90 per cent of the average market rent levels.