Section 61 Program (1973–1978)

Exterior of Village Canadien housing co-operative

Program Objectives

  • To provide modest, affordable housing appropriate to the needs of low- and moderate-income families and individuals
  • To house mainly families whose incomes may be too high for public housing but who cannot compete in the open market for housing
  • To encourage the integration of families and individuals of varying income

Program Features

  • Unilateral federal program
  • Income-mixing
  • Financing for 100 % of eligible project costs
  • Eight per cent mortgage loan from Canada Mortgage and Housing Corporation (CMHC) with 50-year term and amortization period
  • 10 per cent capital grant from CMHC, and, in Ontario, the province, earned over time
  • Subsidy/surcharge system to ensure a mix of incomes (incomes verified at least once every 30 months)
  • A minimum percentage of households, fixed by each operating agreement, must be subsidized.
  • Rent supplements available for a proportion of units (typically 25 %) under separate federal/provincial cost-shared rent supplement program (certain provinces only)

CMHC Authority under Operating Agreement

  • Right to approve changes to co-op’s occupancy charges and surcharges (requirement suspended)
  • Right to inspect co-op’s books, records and accounts
  • Right of access to co-op at any reasonable time to audit co-op or obtain statistical or other information on co-op’s operation
  • Right to inspect property
  • Right to call loan or raise interest rate to current CMHC lending rate in event of breach of agreement
  • Right to approve any contract for management services
  • May require co-op to make such annual or other reports to CMHC in such form and containing such particulars as CMHC may ask for
  • May require co-op to supply such information as CMHC may want for statistical purposes
  • Co-op may not mortgage or encumber property without CMHC’s approval.
  • Co-op may not sell or otherwise dispose of all or part of property without CMHC’s approval.
  • Co-op may not lend co-op funds or guarantee obligations of third parties without CMHC’s approval.

Accountability Framework

  • Operating agreement
  • Annual audited financial statement and information return
  • Approval of housing charges (requirement suspended)
  • Co-op fully responsible for operating results

Program Guidelines for Section 61 Co-op Housing Program and co-ops committed under Section 27 of the National Housing Act


Q&A on the End of your S27/61 CMHC Operating Agreement


Tip of the Month

Good Vacancy Loss

Some vacancy loss is by choice, because units are being refreshed for new members. So not a loss but an investment.