Finance Sustainable Buildings
The Multifamily Housing Tax Exemption (MFTE) is a property tax exemption program that allows eligible cities to target specific areas for multifamily housing development.
Property owners may apply for an 8-year or 12-year property tax exemption for building or rehabilitating multifamily housing. The 12-year exemption requires owners to offer at least 20% of their units as affordable housing, as de-fined by statute.
Cities can use discretion to increase permitted floor area, density, and number of dwelling units if social and environmental sustainability is achieved (measuring and reporting methods to be unified)
Also, for horizontal densification, reduce requirements for minimum distance in case of retrofits, securing legal compatibility with neighbour rights, technical and urban development
Cities have the authority to approve and reject individual projects.
The preference is intended to stimulate the development of new and rehabilitated multifamily housing – including affordable housing. Models indicate that the preference can increase the financial performance of developments. It’s unclear how often MFTE provides an incentive to projects that would not otherwise be built.
This instrument eases Horizontal and Vertical densification as part of sufficiency strategies. Efficient use of living space is also encouraging as multi-family dwelling are prioritise over single-family houses.
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