Carney's Liberals to create new affordable housing developer | Daily Hive

Carney's Liberals promise to create new national affordable housing development entity

Mark Carney. (Liberal Party of Canada)

If elected as the governing party, the Liberal Party of Canada will set forth a multifaceted plan to double Canada’s rate of new home construction.

This plan, announced today by party leader Mark Carney, would grow the country’s number of housing starts over the next decade to reach 500,000 new homes per year.

The largest component of the Liberals’ governing strategy is spinning affordable housing programs and initiatives out of federal Crown corporation Canada Mortgage and Housing Corporation (CMHC) into the creation of a new entity called Build Canada Homes (BCH).

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This includes the transfer of CMHC’s existing Affordable Housing Fund — which provides low-cost repayable loans, forgivable loans, and direct contributions to affordable housing projects led by other levels of government, non-profit organizations, and the private sector — as well as the transfer of the recently created Federal Lands Initiative, which identifies surplus federal lands and properties suitable for redevelopment into affordable housing.

BCH would be a developer to build large-scale affordable housing, including on lands owned by the federal government. It would develop and manage projects and partner with builders in the private sector for the construction phase.

Additionally, BCH would also acquire additional land and offer leases to generate more affordable housing.

“We’re going to build homes Canadians can afford, and a new industry that can take on the world. We’re going to get the government back into the business of homebuilding, while partnering with workers and industry, and cutting taxes for home buyers — so more Canadians can buy their first homes,” said Carney in a statement today.

As for taking the new lead over supporting the financing of projects led by other entities, BCH will provide $10 billion in low-cost financing and capital to affordable home builders, including $4 billion for long-term fixed-rate financing and $6 billion for deeply affordable housing, supportive housing, Indigenous housing, and shelters. It is also noted that $2 billion of this financing would go to supporting new student and seniors housing projects in partnership with other levels of government.

BCH will also provide $25 billion in new debt financing and $1 billion in equity financing to “innovative” prefabricated and modular home builders, with such housing types potentially reducing construction times by up to 50 per cent, reducing costs by up to 20 per cent, and reducing emissions by up to 22 per cent compared to conventional construction methods.

There would be an emphasis on supporting new housing projects that use wood, recycled materials, and low-emission materials.

Additionally, another federal government led by the Liberals would strive to cut municipal development charges in half for a multi-unit residential building by providing municipal governments with a subsidy to cover lost revenues for a period of up to five years.

Escalating development fees imposed by municipal governments have become a growing factor in the sharp rise of construction costs, as cities increasingly rely on these fees to fund the replacement of aging infrastructure and the development of new utilities and amenities for expanding communities.

The Liberals would also reintroduce the Multiple Unit Rental Building tax incentive to help stimulate more secured purpose-built rental housing. This policy was previously credited for helping to build nearly 200,000 units from 1974 to 1981.

As well, the tax liability for private owners of rental housing buildings would be reduced to better enable the conversion of existing structures into affordable housing. This liability would be reduced when such properties are sold to a non-profit housing organization or land trust, with the proceeds reinvested into new rental housing.

This adds to the Liberals’ promise of eliminating the Goods and Services Tax (GST) for first-time homebuyers on new or substantially refurbished homes at or under $1 million. Pierre Poilievre’s Conservative Party has similarly promised to axe the GST for all homes purchased for up to $1.3 million, which takes into account the higher home prices in Metro Vancouver and Greater Toronto.

The federal election is scheduled for Monday, April 28, 2025.

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