It’s been a busy few days for those tracking government measures to build more and better housing. On April 16 the Trudeau government released Budget 2024, providing the math behind a bold new housing plan announced just days earlier.

In short, these latest measures continue to make up for the lost federal leadership of the past 20-30 years on housing. Are there still some blind spots? Yes. Do the federal actions compensate for the insufficient ambition in some provinces? No. But these latest measures will produce measurable, and in some cases rapid, benefits for Canada’s housing supply.

The federal housing plan draws heavily from the recommendations in the Blueprint for More and Better Housing. By our count, no fewer than 40 new commitments pull from the Blueprint’s advice. Yet important gaps still remain.

Of the four overarching goals set out in the Blueprint for More and Better Housing – Affordability, Scale, Low-Carbon, Resilience – the new federal measures make important progress on the first three, and not so much on the last.

Affordability

A number of initiatives in the Budget aim to build or acquire affordable housing. These include a new Rapid Housing stream under the Affordable Housing Fund to build deeply affordable housing and a new Canada Rental Protection Fund to ensure that existing affordable housing stays affordable.

Despite these initiatives and a few others, advocates for deeply affordable housing have given the Budget mixed reviews. It is unclear what affordability conditions, if any, will be placed on the use of federal land or the new Canada Builds initiative.

Scale

The plan sets a goal of building 3.9 million homes “by 2030”, a somewhat less ambitious target than the one set out by the CMHC (and used in the Blueprint). While more realistic, the target still represents a doubling of housing construction over historic averages.

There is a heavy focus on changing the economics of homebuilding, particularly for apartment construction. The plan reintroduces a 10% accelerated capital cost allowance on new apartment builds and exempts those buildings from excessive interest and financing expenses (EIFEL) provisions, two key recommendations of the Blueprint.

The plan makes federal land available for lease, with a focus on land owned by Canada Post and the Department of National Defense, and provides long-term, low-cost financing for apartment construction through the Apartment Construction Loan Program. It also seeks to accelerate the regulatory process, creating a frequent builder stream to fast-track applications from proven homebuilders.

Low-Carbon

The housing plan makes smart moves with respect to ensuring new housing is built for a low-emissions future. Most importantly is the plan’s moves to legalize density. Ultimately, legalizing density requires provincial and municipal leadership, but the federal plan’s insistence that its $6-billion infrastructure fund have densification strings attached is a powerful incentive for the other orders of government to make the right moves – including as-of-right zoning for fourplexes, townhouses, and small apartments.

The infrastructure fund’s conditionality on provinces and municipalities adopting stronger, more climate-friendly building codes that will reduce tenant energy costs is another important ingredient of the plan, along with pre-approval of construction of low-carbon housing plans in the Housing Design Catalogue, and a freeze on development charges in cities with populations of over 300,000.

Strings would also be attached to future transit funding, where cities would have to eliminate parking minimums and allow for high-density housing within 800 meters of a high-frequency transit line or post-secondary institution.

The plan also creates a Canada Secondary Suite Loan Program to help homeowners build accessory dwelling units (ADUs) and other secondary suites.

There are a number of initiatives also designed to lower the carbon footprint of homes, including a new Canada Greener Homes Affordability Program to fund energy-efficiency retrofits for low- and medium-income households.

Finally, the Budget introduces a Homebuilding Technology and Innovation Fund to spur low-carbon housing innovation in Canada.

Resiliency

This is an area where the federal government should draw more from the recommendations of our Blueprint. We simply need Canada’s next generation of housing to be resilient to worsening extreme weather events as a result of climate change. Yet there is little in the 2024 Budget and housing plan to ensure this happens.

The Budget does provide $15 million to the CMHC to “advance implementation of a national flood insurance program by 2025” along with the creation of a CMHC subsidiary to provide flood reinsurance. The Budget does not introduce any new initiatives on hazard mapping (a key recommendation of the Blueprint), and Climate Proof Canada has noted their disappointment that the Budget does not provide funds to advance the National Adaptation Strategy.

Summary

While there remain blind spots, the Task Force for Housing & Climate is energized by these latest federal announcements. For full effect, these federal housing measures must be matched by an equal level of provincial leadership. We’re seeing that leadership in some places, whereas in others the jury is still out.