Canada is in the middle of a housing crisis that has been quietly snowballing for two decades. Rents are skyrocketing, home ownership feels like a distant dream for many, and new construction just hasn’t kept up with population growth. Now, with a newly minted minority government, all eyes are on Prime Minister Mark Carney and his ambitious promise to double the rate of housing construction to 500,000 new homes a year.
It’s a lofty goal—necessary, yes, but also incredibly difficult to achieve.
To his credit, Carney isn’t just paying lip service. His proposed platform is full of big, sweeping ideas: eliminating GST on new homes for first-time buyers, reviewing the mortgage market, and launching a Crown corporation—Build Canada Homes—to spearhead affordable construction. He even pledges to revive the post-war spirit of rapid, government-led building that helped house an entire generation of returning veterans.
But let’s not get ahead of ourselves. There’s a wide gap between vision and execution, and the road from campaign trail to construction site is long and full of potholes.
A GST Waiver Won’t Fix Affordability
The proposed GST waiver on new builds for first-time homebuyers might seem like an obvious win, and it’s something the government could roll out quickly. But the reality is, this is more of a political gesture than a game-changer. The savings are nice on paper—but when the average new condo in Toronto costs around $1 million, a 5% GST break isn’t going to open the door to home ownership for most people.
More importantly, it does nothing to help those in the resale market, where most buyers—especially younger ones—actually shop. It’s a step in the right direction, sure, but in terms of solving the affordability crisis, it’s a drop in an overflowing bucket.
Mortgage Market Reform Is Promising, But It’s Not Urgent
Reviewing the mortgage market to allow longer-term interest rate options is a policy nerd’s dream, and it might give consumers more stability over the long term. But it doesn’t put more homes on the ground. Canadians largely prefer five-year terms, and unless there’s a shift in both consumer behavior and lender offerings, this is more about optional flexibility than systemic change.
It’s a helpful piece of the puzzle, but again—it won’t move the needle on the supply shortage that’s actually driving the crisis.
The Crown Corporation Dream
The most intriguing—and challenging—part of Carney’s plan is the idea of creating a new Crown corporation to directly manage and build affordable housing. In theory, this could be a game-changer. Unlike private developers, a government-backed agency isn’t pressured by profit margins and could focus on building the types of homes Canada really needs.
But creating a functional agency like that is no small feat. In the post-WWII era, CMHC built a nationwide network of local offices, hiring architects, engineers, and inspectors to make the machine run. Replicating that today would take years and a staggering investment—not to mention a workforce that we simply don’t have.
Who’s Going to Build These Homes?
This is the elephant in the room: we’re short about a million construction workers. And while every party agrees we need to build more, no one seems to know how we’ll staff that massive effort. Immigration policy is still sluggish in adapting to labour needs, and domestic training programs take time.
However, there is a potential lifeline here—modular housing. Prefabricated construction could ease the labour crunch by moving most of the building process into factories, where conditions are safer and more consistent. Not only would this reduce the need for on-site workers, but it could also allow faster and more scalable development. This is one area where Carney’s plan deserves real credit: investing in modular housing is a smart, forward-looking move.
Cutting Red Tape with Pre-Approved Designs
Another bright spot is the release of pre-approved housing designs. This might sound boring to some, but it’s a clever, practical move. By streamlining approvals for common building types like fourplexes and rowhouses, it helps bypass one of the biggest bottlenecks in the construction pipeline: municipal bureaucracy.
It’s not flashy, but it could actually make a real difference.
