What housing advocates said to a parliamentary committee about Build Canada Homes

Experts and advocates from Canada’s housing sector say they want to see predictable funding, the use of public lands, and a range of housing types as the feds embark on massive renewed investment in social housing.

Representatives of Canada’s non-market and co-operative housing sectors, as well as housing advocates and researchers have appeared before a federal committee as witnesses to the development of Bill C-20, which will seek to establish Build Canada Homes (BCH) as an independent Crown corporation. 

BCH’s mandate is to expand the supply of non-market housing in Canada, with $1 billion set aside for the construction of transitional and supportive housing. About $1.7 billion will be allocated to support Indigenous housing providers, announced at the end of April. 

Non-market housing can cut construction costs and remains more affordable over time than market housing, said Carolyn Whitzman, adjunct professor and housing researcher at the University of Toronto’s School of Cities.  

“Unlike private development, which slows down as we’re seeing now when profit margins dip, non-market, mission-oriented developers have an almost unlimited demand for their homes,” she said in her appearance in front of the Standing Committee of Human Resources, Skills and Social Development and the Status of Persons with Disabilities (HUMA). 

For both market and non-market housing, predictability and consistency in government policy and commitments are vital, Whitzman added. 

Appearing at a later meeting, Tim Ross, executive director of the Co-operative Housing Federation of Canada, also emphasized the need for long-term, stable financing for co-op homes. 

“We can’t fund […] housing a fiscal year at a time,” he said, appearing before HUMA on Apr. 20. 

The Standing Committee first invited members of the public to participate in the study of Bill C-20, an Act respecting the establishment of Build Canada Homes, on Mar. 30, and has received 44 briefs to date. 

Among those who have submitted briefs are the Assembly of First Nations, the Canadian Human Rights Commission, and frontline service providers like WoodGreen Community Services and Welcome Hall Mission / Maison Bon Accueil. 

Private sector representatives also submitted briefs and appeared before the Committee. Many of the non-market sector witnesses recognized that the construction sector is a critical partner in the development of non-market housing. 

Where Canada once had a significant stock of non-market homes, it now represents under six per cent of all of the country’s existing housing, “after decades of governments redirecting subsidies and financing to the private system, according to researchers at the University of Toronto and Toronto Metropolitan University. 

Meanwhile, the proportion of households unable to pay market rents continues to rise.

There are several definitions of affordable housing across federal policies, said Whitzman, and consistent language is crucial to intergovernmental cooperation between the federal government and provinces, territories, municipalities, and regions. 

The Government of Canada should treat housing development as “a nation-building project comparable to populating the Prairies or the construction of the St. Lawrence Seaway,” said Alexi White, director of systems change at Maytree. 

Where is Build Canada Homes now?

Under the new $13 billion federal agency, several non-market housing projects have already been launched: BCH announced development partnerships with the City of Ottawa and the Province of New Brunswick to deliver non-profit, transitional, and supportive housing. 

During the committee’s study of the Bill, White said that the homes developed with funding from BCH should use government-owned land at the federal, provincial and municipal levels.

“The same model could also be applied to acquisitions of market buildings or conversions of other buildings to residential use, provided the government remains the owner of the asset,” he said.  

Some felt there is still a lack of clarity about the types of housing BCH is targeting. Mike Moffatt from the Missing Middle Initiative said that there has been little transparency about unit mix and household sizes that will be targeted. 

“In 2021, there were roughly 300,000 households in Canada with five or more persons who rented their homes,” he said. 

“Over half of this group live in unsuitably small housing according to the federal government’s National Occupancy Standard.” 

The concern, Moffatt said, is that BCH will build “few homes that are suitable for larger families.” 

Non-market providers are often developing along the housing continuum, from emergency and transitional housing to below-market rentals, said Raymond Sullivan, executive director of the Canadian Housing and Renewal Association. The sector, however, is unsure how many units of each type BCH will target for construction. 

Many of the projects funded under BCH thus far were initially proposed through funding streams administered by the Canada Mortgage and Housing Corporation (CMHC), Sullivan said. 

“New opportunities that are presenting themselves today are projects that will be in the ground four and five years from now,” he said. “But we don’t know how to orient ourselves towards those opportunities, because we don’t know what funding and financing is available from Build Canada Homes and other sources four or five years from now.”

Non-market sector continues to experience financing hurdles 

When Gregor Robertson, Minister of Housing and Infrastructure, appeared before the Committee on March 26, he said that the legislation would grant BCH the authority to provide housing developers with “a flexible mix of financial tools, including grants, low-interest loans, loan guarantees and equity investments.” 

Several of those who appeared before the committee highlighted that non-market housing providers can struggle to access traditional financing opportunities, which are geared towards market housing providers. Raising capital from multiple government sources can be challenging to coordinate, Sullivan added.  

“These projects often struggle to find traditional financing,” said Tony Irwin, president and chief executive officer of Rental Housing Canada.

“Build Canada Homes has the potential to bridge that gap and move more projects from concept to construction, particularly if it [BCH] operates with a clear and focused mandate as a single, dedicated window for the non-market housing sector.”

It is the security and guarantee requirements that a housing provider must meet to secure financing that can hinder a non-market provider from accessing financing, Ross said. 

While there are some opportunities baked into the design of BCH, “the fee load associated with guarantees is often very prohibitive for non-market housing developers, because they lack the balance sheet liquidity to pay those substantial fees,” he said.