Teaching Resource

Workshop Instructions

— Affordable by Design —
Why does it cost so much to live downtown?
And what can we do about it?

These instructions are intended for teachers, students or other interested parties looking to offer a workshop on affordable housing. If you would like to facilitate this workshop, please read this guide in its entirety, and watch the supporting video first. Contact us if you would like to organize a workshop for your organization or class facilitated by Dr. Markus Moos.

Contributors:
Markus Moos (PhD); Samantha Biglieri (MPLAN); Alvin Fan; Katherine Laycock (MSc); Matthew Quick (MA)
Nicholas Revington (MSc)

School of Planning, Faculty of Environment, University of Waterloo
This work was supported by an Early Researcher Award from the Province of Ontario.

Contact:
Dr. Markus Moos, Associate Professor
mmoos@uwaterloo.ca | @Markus_Moos | generationedcity.uwaterloo.ca

You are free to use and share this resource. This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

What is this workshop about?

This workshop deals with the increasing cost of housing in downtown and other central locations. It explores the reasons as to why a growing number of young people are wanting to live in large cities near shopping and restaurants that are accessible by transit or on foot while at the same time finding it increasingly difficult to pay their rent or mortgage.

Audience, Workshop Size and Length

The workshop is intended for advanced grade 11 or 12 secondary school students. It could also be suitable in first-year post-secondary courses by increasing the complexity of the scenarios introduced in each of the exercises. The workshop is intended to be run for classes up to 30 students, split into groups of 3-5. Ideally, each group should include a facilitator or teaching assistant (or one facilitator could circulate among groups). At minimum, 2 hours are required to run this workshop.

Background

We hear about skyrocketing downtown housing prices from the media on an almost daily basis. Even the United Nations has recently expressed concern over the extent of Canada’s housing affordability problems. In addition to acute housing issues such as homelessness, an increasing number people cannot live near transit or near their work even if they wanted to. Houses or apartments are simply becoming too expensive in these desirable locations. But what can we do about it? In this workshop, we will explore design solutions in the areas of urban design and city planning and housing finance and development processes that can help reduce the cost of housing.

What will students learn?

This is a ‘hands-on’ workshop where students will not only learn about design solutions to housing affordability issues, but also engage in exercises that encourage them to consider innovative solutions of their own. At the end, students will have increased awareness of housing affordability issues, urban planning, and examples of design solutions aimed to help reduce the cost of housing in growing cities. The workshop will be of great interest to students wanting to learn more about issues related to housing affordability, urban design and planning.

Workshop Details

Introduction

Format: Interactive lecture

Materials: Notes distribute in paper or made available electronically (see accompanying file, intro_material.pdf)

Board and markers to summarize student answers to questions

Length: 20 minutes

Content: Ice-breaker exercise: Ask everyone to say their name, and estimate cost of the house shown on the first page of the workshop materials (Answer: $2.5 mill.).

What determines cost of a house? [Ask students]
Outcome: Students should understand that broadly speaking there are two kinds of factors, those specific to the house (e.g., size, number of rooms, pool, architectural designs etc.) and those specific to the location (e.g., proximity to desirable schools, transit, downtown etc.)

What makes a house ‘affordable’? [Ask students]
Outcome: Students should understand that affordability is determined by both the price of a house as well as the income of people living there.

Introduce Canada Mortgage and Housing Corporation housing affordability guidelines (paying less than 30% of one’s income toward housing)
Explain changing affordability of housing in Canada, specific focus on young adults
Explain how changing location trends may help, in part, to explain the trends (define youthification: influx of young adults into amenity-rich, high density areas), as do declining incomes and increasing housing prices (both parts, income and price, of the affordability equation are being impacted)
But why would young people want to move into the most expensive locations? (amenities, smaller housing units to fit their household size)

Explain rest of the workshop to students (in general terms, leaving detailed instruction of each exercise to small group facilitators)

Exercise 1: The cost of location

Format: Small group exercise led by a facilitator

Length: 30 minutes

Materials (see accompanying file ex1.pdf for sample material):

Two large pieces of bristol board or sturdy paper (e.g., 18×24 inches) with a simple street layout (bird’s view) drawn on ahead of time
Markers, several colours
Four pieces of 10 inch string per group with tape indicating one inch marks along the length of the string.
Blocks or other objects that can work as placeholders for
A home
Downtown
School
Transit station
Public park

Content: This exercise is carried out in two rounds.

In the first round, students are provided with one of the street layouts. The task is to think of the kinds of things young people (about 18 to 25 years of age) might want to have in their neighbourhoods (e.g., bars, gym, cool coffee shop etc.), and to draw this directly on the street layout using markers provided.
Facilitator asks about reasons behind their choices, and also reminds students to consider essentials (if students don’t include them) such as grocery stores, transit, police, social services, hospital etc,

In the second round, students are asked to place all the blocks on the second street layout, indicating their preferred location of home, downtown, school, transit station and parks.

Then, students are told that it would cost $250 per month to reside immediately adjacent to one of the downtown, school, transit or park. For example, if the students place all blocks, including home, in one in single location, the housing costs per month would be $1,000.

Students are provided with string, where each one inch increment corresponds to a $50 decline in housing costs (for each block). Note that the cost cannot go below $50 per block, regardless of how far students move away from each of the four locations (represented by blocks). The $50 is the ‘base cost’ that reflects the characteristics of the house itself.

Students are given a monthly income of $1,000. They are asked to arrange the blocks in a manner so that they can afford the monthly housing costs, which are determined by the distance from ‘home’ block to each of the other four blocks. For example, if ‘home’ is 3 inches away from downtown, 4 inches from a school, 2 inches from transit and 1 inch from a park, monthly housing costs would be $550. This represents more than 50% of monthly income, and is therefore not affordable.

Facilitators provide guidance to ensure students understand that this exercise is about the relative cost of a location of a home, and how people are forced to make trade offs among desirable locations and transportation costs (travel time).

Exercise 2: Housing Decisions Made by Different Types of Households

Format: Small group exercise led by a facilitator

Length: 30 minutes

Materials (see accompanying file ex2.pdf for sample material):

Four large pictures (per group) illustrating four different kinds of housing in different locations
High-rise apartments, owner occupied, near downtown of a major city, ~1 bedroom, monthly housing cost
Single-family home, owner occupied, near downtown of a major city, ~3-4 bedrooms, monthly housing cost
High-rise apartments, rental, in older suburb of a major city, 1-2 bedrooms, monthly housing cost
Single-family home, owner occupied, in a suburb of a major city, minimum 3 bedrooms, monthly housing cost

Content:

Each group randomly draws a household type AND an income (separately)
Household types: Single woman; Couple, no kids; Couple, two children; Couple, three children; Single woman, one child
Income: Minimum wage, one earner ($1,800 per month); Professional income ($4,500 per month); Trades income ($3,000); Minimum wage, multiple jobs ($2,500)

Based on their income and household type, students are asked to decide as a group which of the four neighbourhoods they would want to (or could afford to) live in.

Facilitators will ensure students think about basic concepts of housing affordability (i.e., not spending more than 30% of income on housing), and consider the number of bedrooms in relation to the number of household members

After every group has decided on a neighbourhood, students are asked to decide how they could make it more affordable. Facilitators encourage students to think about government policies that can reduce the cost of housing (e.g., requiring builders to develop a certain percentage of housing at a certain price point, moving further away from central areas, building designated affordable housing etc.) and policies that can increase income (e.g., income tax rebates, increases in the minimum wage, rent supplements etc.).

Exercise 3: Development Finance

Format: Small group exercise led by a facilitator. Groups compete.

Length: 30 minutes

Materials (see accompanying file ex3.pdf for sample material):

One laptop or desktop computer for each group
Excel

Content:

Students are tasked with the responsibility to come up with a project proposal that generates positive revenue in a development scenario. The group with the highest return wins.

Scenario: Imagine you are a Planner working for a developer. You are asked to come up with a financially feasible development proposal for your client while also meeting planning regulations. In the neighbourhood where your client wants to build, the City envisions primarily single family homes with opportunities for select apartment buildings that do not alter the overall character of the neighbourhood. At least 1 parking space per apartment unit is required for new developments.

Details:
Cost of single-family homes (sfd) in the area: $700,000
Desired profit margin: 10% of total revenue earned from sales
New apartment units have generally sold for $200,000 to $450,000 in this neighbourhood.
Land requirements:
3-storey building — purchase three sfd for every 20 units
4-storey building — purchase two sfd for every 20 units
6-storey building — purchase one sfd for every 20 units
Cost of providing parking: $10,000 per parking space
Demolition/construction/development costs: $100,000 per unit
Development charges (to cover cost of infrastructure such as water and sewer lines): $10,000 per unit

Task: Students are asked to come up with a project proposal that generates positive revenue (after paying the 10% to investors) and meets planning requirements. The group with the highest return wins.

Remind students that they will first need to decide how many to build, and how many single family homes they would need to purchase to demolish and build on. They will also need to decide how much to charge for the sale of new units.

After some time with the spreadsheet, ask students how we could make the development more affordable?

Facilitators can provide prompts:
Zoning amendment so that we can build more units, taller buildings
Require share of units to have lower price than others
Government subsidy (income tax transfers or subsidies housing directly)
Reduce parking requirements
Lower development charges

Students can consider what implications would be of each of these scenarios

Additional Resources

Generationed City. Research project. School of Planning, University of Waterloo. http://www.generationedcity.uwaterloo.ca

Canada Mortgage and Housing Corporation. https://www.cmhc-schl.gc.ca/en/inpr/afhoce/afhoce/afhostcast/afhoid/