Federal government housing plans, spring 2024: a Springboard briefing

10 min readApr 30, 2024

Overview

The federal government made a series of announcements in April 2024 leading up to Canada’s Housing Plan and Budget 2024. These include many new policies and initiatives as well as changes to existing plans. This brief summarizes what we know and what we don’t about the federal government’s housing plans, including details of the various initiatives. It includes:

an overview of the housing plan
a look at how the the housing plans will be delivered
a map of the initiatives announced in spring 2024
some math on the federal government’s housing targets; and
a run-down of the decisions and consultations ahead in the next year

About the housing plan

We have reached the “use every tool we have” stage of the housing crisis.

The federal government’s plan includes three main pillars:

Supply-side: getting more housing built by the market
Demand-side: helping people afford the supply that’s available in the market
Non-market: creating more subsidized options and other supports related to homelessness

The plan now features just about every policy lever available to the federal government — taxes and tax breaks, grants and loan guarantees, public lands and infrastructure. There are carrots, sticks, and what analyst Steve Lafleur (now of IRPP) calls “carrot sticks”.

We now seem to have two competing national housing strategies being managed by the same government.

The launch of “Canada’s Housing Plan” (CHP) brings together the federal government’s policy approach to housing in an integrated way. Compared to the 2017 National Housing Strategy (NHS), the federal government is now looking at the whole housing spectrum together.

However, the CHP does not replace the NHS, which has funding and programs through 2028. Instead, we now have two partially overlapping plans.

For example, the CHP includes some, but not all, of the NHS initiatives. Increases to the Affordable Housing Fund, the Apartment Construction Loan Program, and the Federal Lands Initiative are all NHS initiatives listed in the CHP, but the CHP makes no mention of the Canada Housing Benefit, Housing Supply Challenge, or Demonstrations Initiative.

Canada Mortgage and Housing Corporation (CMHC) continues to report quarterly on National Housing Strategy progress. This includes tracking some (but not all) of the other federal housing policies that have been introduced since 2017.

For example, NHS quarterly reporting includes the Rapid Housing Initiative (launched in 2022), and the First-Time Home Buyer Incentive (launched in 2019 and shut down this March) but not the First Home Savings Account.

The National Housing Strategy Act requires the government to maintain a strategy that the National Housing Council and Federal Housing Advocate hold them accountable for. Are we in a transition stage towards a new national housing strategy? Or has the government gone for extra credit with a second strategy on top of the first? ¯\_(ツ)_/¯

The goalposts are shifting

The CHP and Budget 2024 lay out a clear goal of measures leading to the creation of 2 million net new homes by 2031 — more than doubling the 1.87 million homes that were projected to get built without new measures. The Budget estimates that the measures introduced since fall 2023 would lead to 1.2 million of those 2 million net new homes.

By comparison, the 2017 NHS set targets of 100,000 new homes over ten years. While the NHS was much more focused on below-market costs, the 2024 CHP is looking to incent more new units each year than the 2017 NHS targeted in a decade.

Because the CHP is looking at a broad range of the housing spectrum, the affordability targets are less clear. The Budget references a “commitment that no hard-working Canadian should spend more than 30 per cent of their income on housing costs” — which lines up with the standard measure of Core Housing Need

By comparison, the 2017 NHS had a stated target of 530,000 households removed from housing need as a result of the strategy.
While the 30 per cent of income is a high-level target, the actual affordability requirements of the various streams of federal funding are much more modest.

Did a BC write this housing plan?

The Canada Housing Plan very actively copies many ideas from the Eby government in BC. Some of these, like the Canada Builds initiative are credited quite explicitly to BC. Others, like the secondary suite program and the Canada Tenant Protection Fund borrow major features and even naming conventions. If you want to know where the federal housing plans are headed, just ask two-time Olympian Minister Ravi Kahlon.

Delivering the housing plan

The housing plan continues to rely heavily on CMHC to play the lead role.

While much of the policy function of CMHC is in the process of transferring from the arms-length Crown corporation to the core federal public service (in the newly renamed Department of Housing, Infrastructure and Communities), CMHC remain the delivery arm for most of the federal initiatives. In the coming year this will include continuing and expanding existing programing, as well as designing new initiatives like the “Canada Rental Protection Fund” acquisition program and a new “Canada Builds” program.

But other pillars of the housing plan rest elsewhere in government.

The signature initiatives related to public lands do not appear to rest with CMHC, relying instead on Public Services and Procurement Canada, and a new secretariat based in the Privy Council Office. Deputy Cabinet Secretary Paul Halucha has been cross-appointed as Deputy Minister of Public Lands and Housing. The Canada Lands Company (a separate crown corporation that manages some federal lands and real estate) is also being tagged to lead development.

The measures to encourage innovation in housing technology and materials rely on the NGen manufacturing “supercluster” and regional development agencies, alongside the existing Housing Supply Challenge managed by CMHC. It is unclear who will lead a new “housing industrial strategy” development, though this would likely fall under Innovation, Science, and Economic Development Canada.

And the success of the strategy (and some of its funding) depend on actors outside the Government of Canada.

Provinces, territories, and municipalities hold jurisdiction over many of the policies that the government is seeking to influence (e.g. building codes, tenant protection) and some of the initiatives call for provincial/territorial matching funding (such as homelessness funding under Reaching Home). While Minister Fraser has been quite successful in “buying change” with federal housing funds, this will require some ongoing negotiation.

In some cases, provinces are well-aligned. The new Canada Builds initiative is explicitly modeled on BC Builds, and the new Canada Rental Protection Fund on BC’s Rental Protection Fund. In other cases, there is a collision course of priorities: for example, between the Ontario government’s rejection of fourplexes as-of-right and the requirement for the Canada Housing Infrastructure Fund that provinces adopt four units as-of-right.

Banks are also “policy actors” for some of the initiatives in the CHP. While the Government of Canada regulates banks, most of the proposed changes related to mortgages are being packaged in the voluntary Canada Mortgage Charter.

Initiatives announced in spring 2024

The housing initiatives announced in spring 2024 cut across different policy levers, target populations, and across homeownership, the rental market, and non-market housing. The initiatives can be broken down into 8 main categories:

Initiatives to make public lands available for housing
Tax changes
Concessionary financing for purpose-built rentals
Financial contributions to non-market housing
Measures to support access to homeownership
Infrastructure funding for other orders of government/to bribe policy change
Homelessness and shelter support
Housing supply innovation

Public lands

The CHP and Budget 2024 include a wide range of initiatives aimed at making public lands available for new housing development. The Budget suggests the federal government expects a significant amount of development on public lands — amounting to 250,000 units by 2031. A much more modest $200 million Federal Lands Initiative had been part of the 2017 NHS to make surplus federal lands and buildings available at low or no cost, resulting in 4,000 units to date.

Tax changes

The Canada Housing Plan includes some tax changes that will affect housing development, primarily aimed at encouraging more purpose-built rental construction. These come in addition to the removal of GST/HST on purpose-built rental development, a measure that had been a long-time advocacy ask of the sector, introduced in 2023.

Concessionary financing for purpose-built rental

Lower interest loans for purpose-built rental construction have been a part of the federal government’s housing approach since 2017. Measures in fall 2023 and spring 2024 expand on the use of this lever, including a modest new program targeted to encourage homeowners to add secondary suites — some thing that lines up in principle with the zoning changes encouraged by the Housing Accelerator Fund.

Financial contributions to non-market housing

While there are relatively few new investments in non-market housing construction or acquisition, capital contributions to non-market housing are still built into the fiscal and policy framework. This includes the rollout of a new fund for co-op housing development (announced in 2022) along with National Housing Strategy investments. Given the scale of the non-market housing investments compared to the targets for market rental or homeownership, the non-market share of the housing stock can be expected to continue to fall.

Funding for other orders of government for infrastructure (AKA to bribe policy change)

The Housing Accelerator Fund (HAF), announced in 2022, has bought surprisingly significant policy changes from municipalities for surprisingly little money. The 2017 NHS — and most federal-provincial funding agreements — have been very deferential to provinces. Even “national” programs like the Canada Housing Benefit were loosely defined cheques to deliver programs in a very general area. By contrast, through the HAF, the federal government has asked for very specific policy changes from municipal governments in exchange for relatively modest amounts of money. These results have inspired more interest in exchanging federal funding for housing-related policy change outside of federal jurisdiction. The 2024 edition of the federal housing plan features infrastructure funding with a variety of conditions tied to provincial and local policy change.

Funding for other orders of government for infrastructure initiatives

Measures to support access to homeownership

The Budget includes a few changes specifically targeted to homeownership, particularly for firs-time buyers. These are modest — the bigger impact on access to homeownership would come from the success or shortcomings of the other measures to increase housing supply overall (e.g., the public lands initiatives or the changes being pushed by the infrastructure funding conditions).

Homelessness programming

In addition to measures targeted to housing supply and non-market housing, the Reaching Home federal homelessness program and other related initiatives fund a variety of community-level interventions, including wrap-around supports.

Housing supply innovation

As part of the goal to increase housing supply and make it more affordable, the CHP includes some measures aimed at promoting potentially cheaper construction techniques (e.g. modular construction) both in subsidizing industry efforts and reducing regulatory barriers.

Tenant protections

Since 2021, the federal government has highlighted concern about the experiences of renters negotiating with landlords in low vacancy markets. While these are issues firmly in provincial/territorial jurisdiction, the CHP includes a plan to advance a “Renters’ Bill of Rights” to be negotiated with provinces and territories. The federal government plans to make Canada Housing Infrastructure Fund dollars contingent on signing on to these measures, suggesting there should be more detail in the next 3–6 months, as those agreements have a Jan 1, 2025 deadline.

Design and decisions-ahead

The Budget and CHP initiatives set up a large amount of policy and program design and consultation ahead. Even with all the announcements, the government has made a number of commitments to follow up on housing initiatives in the coming months. Here’s how those commitments break down, where there are timelines attached.

This spring

Launch a new Public Lands Action Council
Initiate discussions with PTs about Canada Builds as soon as possible
Further details on the Canada Green Buildings Strategy in the coming weeks

In 2024

Launch consultations on a new residentially-zoned vacant land tax
Announce details of a new Canada Post Housing program
In the “coming months” engage with stakeholder s to co-develop a Canadian industrial strategy for homebuilding
The National Research Council will launch consultations with provinces, territories, industry, and fire safety experts to address regulatory barriers to scale up factory-built housing
Consultations coming with the mortgage industry on making available a tool through the Canada Revenue Agency to complement the existing strategies of financial institutions to verify borrower income for mortgages
More details about the 30-year insured mortgage for first-time buyers “in the coming months”
Details of the Canada Secondary Suite Loan Program in the coming months

By fall 2024

Launch a new public land bank
Publish the first phase of the housing design catalogue

In Fall Economic Statement 2024

On measures to restrict the purchase and acquisition of existing single-family homes by very large, corporate investors, the government will consult in the coming months and provide further details in the 2024 Fall Economic Statement and fiscal update.
Update on new measures to expand access to alternative financing products, like halal mortgages. Update coming in the 2024 Fall Economic Statement.