The city of Vancouver has given developers $10 million in breaks on city fees through two rental housing construction incentive programs since 2009 — helping to create more than 1,300 units at a time when such housing hasn’t been built elsewhere.

But now, in an effort to make sure rental housing is more affordable for those who need it and to further drive down costs, the city is redrawing the rules to make sure developers aren’t targeting the luxury rental market.

The city has set a maximum rent developers can initially charge for studio, one and two-bedroom apartments in new dedicated rent-only buildings. Those rates — $1,443 per month for a studio, $1,517 for a one-bedroom and $2,061 for a two-bedroom apartment — are supposed to mirror the range of Canada Mortgage and Housing Corporation’s annual report on rents and not exceed 30 per cent of the renter’s income.

But they are still well above the rates many renters can afford in Vancouver’s extraordinarily tight rental market, and are even above the rates developers charge for some new buildings built under the now-closed Short-Term Incentives for Rental pilot project.

The city says the new maximum rates are geared toward people with a combined household income of between $58,000 and $82,000. Those incomes are within the range targeted by Mayor Gregor Robertson’s housing affordability task force.

The changes approved by council Tuesday alter how developers will qualify for the waiver of development cost levies under its new Rental 100 incentive program. The rules, which allow the developer to avoid the cost of installing city services in return for dedicating all of the units for rental, put a maximum average size on apartments, a limit on construction costs, and the use of modest rental-level finishings. They also remove the discretion of city manager Penny Ballem to approve individual incentive applications, instead creating a regulatory process developers say is more fair.

Council stopped short of offering developers incentives for building three-bedroom rental units because the household income required to qualify would be more than $102,000.

“Council didn’t want to be seen giving incentives or subsidies to people with that level of income,” said Coun. Raymond Louie.

Instead, the city may look at changing its regulations to require condo developers to build a certain number of those larger family-oriented units. That would be similar to regulations the city already has that require developers to provide at least 20-per-cent social housing, of which one quarter must be for families, Louie said.

The new rules are the latest attempt by the city to address Vancouver’s high cost of housing and tight rental market. More than half of all Vancouver households rent. Over the last 30 years, the average vacancy rate has been just under one per cent.

The federal government’s twin cancellations in the 1980s and ’90s of tax incentives for multiple-unit rental building construction and support for social housing construction have also helped create pressure.

Nearly 25 years ago, then-mayor Gordon Campbell tried to restart a stalled rental construction industry with a $50-million program that made city land available to what is now Concert Properties. Although the program initially worked, high land prices and construction costs have made it more profitable for developers to build strata condominiums.