by Tim Richter
The federal government’s proposal to create “a new federal entity responsible for building affordable homes, financing affordable home builders, and catalyzing a more productive homebuilding industry” —Build Canada Homes (BCH) —is an ambitious and potentially transformative concept that could reshape Canada’s housing landscape. It’s the centrepiece of Prime Minister Mark Carney’s pledge to “drive [housing] supply up to bring costs down” and—if it’s done right—it could be a major breakthrough in ending homelessness.
That’s why the Canadian Alliance to End Homelessness’ Fall Budget 2025 priorities includes a call for the federal government to ensure BCH delivers the deeply affordable and supportive housing needed to reduce homelessness.
Earlier this week the federal government released the Build Canada Homes Market Sounding Guide, which sets out the initial vision for the program. We reviewed the guide with an eye to how BCH can build the types of housing Canadians need and support a stronger Canadian economy.
We were glad to see a much-needed focus on deep affordability and big thinking about how BCH could deliver affordable housing at scale, support breaking down silos and leveraging land, finance, and the expertise of manufacturing, construction and market and non-market providers to have the biggest possible impact.
Based on our analysis of the guide and our experience supporting homelessness reduction in communities across Canada, here’s what else BCH needs to succeed:
1. The Full Support of Team Canada
Our number one recommendation for the federal government in this upcoming budget is to commit to negotiating a new national housing agreement with provinces and territories. The fact is, the scale of change we need can’t be accomplished by BCH or any government on its own, and our current, fragmented efforts haven’t worked.
The BCH market sounding guide nods to the need for federal/provincial/territorial (FPT) collaboration and positions the federal government as a leader. This is positive, but without the foundation of a clear FPT agreement that establishes a shared vision, objective and outcomes, BCH efforts could be delayed by jurisdictional wrangling, or some provinces opting to step back when we need them to lean in.
We know it can be done, building on past national efforts in health care, child care, and disaster response. It’s going to take everyone at the table to end homelessness and solve the housing crisis for good.
2. A Realistic Definition of Affordability
The BCH guide has a much-needed focus on deep affordability. But when it comes to defining affordability, it talks about everything from supportive housing to “moderate income” housing in one sweeping category. We see similar issues in market-linked definitions of affordability that don’t reflect what Canadians can actually afford. Without a crystal-clear definition of affordability tied to what low income households can actually afford (based on the accepted standard of 30% of pre-tax or gross income), we risk building housing that doesn’t help people who need it the most. This was a critical shortcoming of the National Housing Strategy that we have the opportunity to learn from with BCH.
3. Build for Outcomes not Outputs
Counting the number of units built is only one piece of the puzzle. True success means measurable community-level reductions in homelessness, measurable reductions in the rate or incidence of core housing need, and rental and home prices moving closer to true affordability. Focusing just on raw numbers can lead to building the wrong types of unit, at the wrong price, in the wrong places, which means we aren’t meeting people’s needs. BCH’s design should measure success based on outcomes (not just raw numbers) so we don’t spend billions without improving housing outcomes for Canadians. This was another key shortcoming of the National Housing Strategy.
4. Clear Prioritization
BCH’s current approach risks trying to be everything, everywhere, all at once. We need to start by prioritizing those in greatest need – it’s the smart thing to do, and it’s the federal government’s own policy. Under the National Housing Strategy Act, the housing policy of Canada is the progressive realization of the right to housing. That means, Canada’s housing policy requires BCH to prioritize those in greatest need and set clear targets and timelines to meet those needs.
5. Private Investment and Market Leadership on “Moderate Income” Housing
Housing for “moderate-income” Canadians is important, but BCH should not replicate what the private market can often deliver more quickly with smart federal incentives like a modernized Multi-Unit Residential Building (MURB) program or with other tax/regulatory changes. BCH could support people on the way to ownership, through attainable programs like Habitat for Humanity, but the predominant focus must remain on affordable and supportive housing. The government should explore other policy instruments to restore the pathway to home ownership for younger Canadians in particular. BCH and the federal government can help catalyze private market construction, but BCH itself should be laser-focused supporting those Canadians the market can’t or won’t serve by providing deeply affordable and supportive homes.
6. Lower Construction Costs
BCH is launching in a challenging context for new housing construction. High costs for land, material and development charges, regulatory bottlenecks, infrastructure challenges, and labour and supply chain constraints are all taking a toll. BCH needs to promote the systems changes, FPT collaboration, and cross-sector commitment that we need to get things back on track.
7. No Time to Waste
Launching a new federal entity on the scale of Build Canada Homes is a massive undertaking and it will take time. Homelessness is continuing its lethal trajectory upward. More than half of Canadians are worried they are one emergency away from losing their homes. The government must find a way to keep building housing and the infrastructure necessary to support it through existing programs while BCH is established. At the same time, the government can have an immediate impact on affordability and build a safety net by renewing, expanding, and focusing the Canada Housing Benefit in partnership with the provinces. This would ensure struggling people keep their homes and people experiencing homelessness can afford housing, and it would buy Build Canada Homes the time needed to build the homes we need for long-term sustained affordability.
What’s Next
As trade tensions drive new pressures on Canada’s economy, housing has a central role in supporting the federal government’s focused effort to drive growth – attracting investment, creating good jobs, and increasing productivity.
The design of BCH and the coming fall federal budget are key opportunities for our new federal government to develop and lock in the right approach—to deliver on their economic commitments and change the trajectory of Canada’s housing and homelessness crisis.