The federal government has promised to pour more funds into its low-cost loan fund to support construction of rental housing. The second top-up in as many years was recently announced in the 2019 budget and, if realized, would amount to $10 billion dollars over nine years.
Ultimately, the government envisions 42,500 units of new rental supply will be built Canada-wide for tenants with modest to low incomes, leveraging the Rental Construction Financing Initiative. Thus far, five projects encompassing 500 units have been approved under the program launched in 2017, but the 2019 budget reports “more than 50 projects have been prioritized to receive a loan”.
Another $300 million will be disbursed to municipalities and other stakeholder groups through the new Housing Supply Challenge. Infrastructure Canada and Canada Mortgage and Housing Corporation (CMHC) have been tagged to jointly oversee the merit-based competition for proposed “new ways to break down barriers that limit the creation of new housing.” More details are promised for the summer of 2019.
“We have heard from Canadians in communities of all sizes, including our largest cities, like Toronto and Vancouver. They have told us that finding an affordable place to call home is not just a challenge. For too many hard-working Canadians, especially for young people, it feels like an impossibility,” Finance Minister Bill Morneau told the House of Commons as he introduced the budget. “There aren’t enough houses for people to buy, or apartments for people to rent. That makes finding a good place to live too expensive — beyond what many people can afford. In this budget are measures to increase the supply of housing, because we know this is the most effective way to address affordability in the long run.”
Two smaller funding commitments are meant to trigger and inform creative problem solving. CMHC will receive $5 million over two years to be directed to “state-of-the-art housing supply modelling and related data collection”, while $4 million over two years goes to support the recently established Expert Panel on the Future of Housing Supply and Affordability. The latter is a joint effort with the government of British Columbia, focusing on ways to boost the province’s housing supply.
The budget confirms pending introduction of legislation that would require the federal government to maintain a National Housing Strategy that places a priority on “the housing needs of the most vulnerable”. That would also include a mandate for regular progress reports.