Fix Housing 9: What We Think of the Recent Federal Announcements on Housing

And what is missing from the Canadian Government's pre-budget housing proposals

The first week of April was a busy one for federal government announcements on housing. There were major announcements in Halifax, Toronto, Winnipeg and Calgary.

There was a lot announced. Here are highlights of what the Government of Canada will be including in the April 16 federal budget.

More Cash to Those Cities That Build

There will be a $400 million top up of the Housing Accelerator Fund. The HAF is money sent straight to municipalities, in exchange for them committing to build new homes and remove restrictive zoning. On zoning, the HAF approach can be summed up as requiring “4 units as-of-right” on any residential property (replacing in many cases, single family zoning).

There is money for a new $6 billion Canada Housing Infrastructure Fund. This is money for infrastructure investments in water, wastewater and solid waste (but not roads). This money will flow through those provinces and territories that agree to 4 units as-of-right province-wide, or if the province/territory does not agree, directly to compliant municipalities. It also requires municipalities to commit to freezing development charges for a period of three years.

Rental Construction and Loss Prevention

The Government has created a new $1.5 billion Canada Rental Protection Fund. This provides loans and grants to non-profit housing providers to acquire affordable rental buildings when they go up for sale, rather than those units being acquired by a for-profit developer that causes the loss of affordable market rental housing.

There is also a $15 billion top-up to the Apartment Construction Loan Program, along with administrative reforms to make the program more responsive. This is coupled with a new Canada Builds program, inspired by the BC Builds program, providing provinces and territories access to the Apartment Construction Loan Program to build more rental housing.

The Government also introduced a new $15 million Tenant Protection Fund and a Canadian Renters’ Bill of Rights.

Building Technology

The Government is providing $600 million to advance modular and pre-fabricated homes, and to create a Housing Design Catalogue of about 50 home blueprints — which should speed up approval processes.

Our Take

Cities

We’re pleased to see the Housing Accelerator Fund get more money. It has been a successful federal program, largely because the Government decided to play hardball with municipalities around ending restrictive zoning. Cities are cash strapped and the feds are using that to create some required zoning reforms at the local level.

The Canada Housing Infrastructure Fund is also a much needed initiative, and will give the feds further leverage to drive zoning reform. And while $6 billion sounds like a lot of money, we have argued that the federal government should be transferring to municipalities $6 billion a year.

Infrastructure is expensive. Let’s look at one single example in the City of Ottawa. Ottawa Council decided to approve a brand new community, Tewin, on the edge of the city. (Approving a new community so far from existing services is NOT something we support.) Bringing water and sewers to this new community is expected to cost $600 million. Ottawa is about 3% of the Canadian population, and so could reasonably expect to receive about $180 million from this new fund. That’s not going to pay for even this one infrastructure investment for Ottawa. Spread across the whole country, $6 billion for infrastructure does not go very far.

We have mixed feelings about freezing municipal development charges. DCs are a cost that gets added to the price of a new home. So they affect affordability. But cities are severely underfunded, and DCs are an important revenue source. DCs pay for growth. Growth means infrastructure, but it also means the services that a growing community needs — transit, parks, libraries, policing, … If we are freezing development charges, provinces should be stepping up to make municipalities whole. Otherwise, we’re just forcing municipal property tax increases.

Rentals

We’re very pleased to see the Rental Protection Fund come forward. We have previously called for an acquisition fund, as one measure to stop more people falling into homelessness. The scope of this program could and should be much larger than $1.5 billion, but this is a promising start.

What’s Missing from the Federal Announcement?

The Government might have more to say on housing between now and April 16. But if not …

We have long argued to think of housing as a system, from home ownership to rentals to community housing to homelessness shelters. Disruptions in one segment of the housing market spills over into other segments.

The announcements of the federal government were focused on home ownership and rentals.

In addition to the acquisition fund, we would liked to have seen an announcement on supporting more community (social) housing. In fact, we believe innovative federal financing could allow 1 million new community homes to be built by 2030, making up for four decades of inaction on public housing.

The federal government was absent from building community housing from the 1980s until about 5 years ago. The federal government has taken some important steps forward with its National Housing Strategy. But there is still a lot of catch up required.

We also believe that there is an urgent need for the federal government to act on homelessness and the growth of encampments across the country.

We know the solution to homelessness: housing. More highly affordable community homes.

Homelessness has moved from an abstract concept for Canadians to something that could now be a real possibility, if not for us directly, for someone we know.

We hope the 2024 budget will have something to say on how we begin to end homelessness in Canada.