First Nations housing market

The Government of Canada is introducing a new financing plan that will allow First Nations people living on reserve to build, buy or renovate a house on-reserve.

The plan has three stakeholders; the Canadian Government (a.k.a the taxpayer), Canadian financial institutions and First Nations organizations.

The intention of the program is to create an on-reserve housing market that will encourage investment and home ownership.

Essentially, the Fund is designed to provide an extra safety net for the lender in the event the borrower defaults on the loan and the First Nation does not honour its obligation to step in using its own resources, to remedy the default.

Final thoughts: One item that I am not clear on is the ownership of the underlying land. IMO the land must be part of the home ownership if this is to work.

If First Nations people can only invest in the "house" on the land, then they are paying allot of money for a depreciating asset. Under this scenario the program is a money loser for all except the lender.

There are many challenges ahead for this program to create an "investment" type housing market on a First Nations reserve. Some of these challenges are covered in this post by Grassroots News .

It will be interesting to see how this "real estate market" takes form over the long term. If you have any additional information on this please leave a post.