A recent report from the Parliamentary Budget Officer (PBO) indicates a substantial decrease in funding for housing programs in the upcoming four years, with the government’s leading $13 billion housing initiative projected to result in the construction of only 26,000 new homes.
The PBO report focuses on the impact of Prime Minister Mark Carney’s new housing agency, Build Canada Homes, along with other programs in facilitating the construction of new homes until 2029-30.
According to the report, the federal government’s expenditure on housing initiatives, currently at $9.8 billion in 2025-26, is anticipated to drop significantly to $4.3 billion annually by 2028-29, representing a 56% reduction.
The decline in annual funding is mainly attributed to the conclusion of funding for programs like the Housing Accelerator Fund, the Affordable Housing Fund, and Canada Housing Benefit, as per the PBO.
The PBO report predicts that several housing funding envelopes will either expire or decrease over the next four years. This includes reductions in funding from Crown-Indigenous Relations and Northern Affairs Canada, the Canada Mortgage and Housing Corporation, Housing, Infrastructure and Communities Canada, and Indigenous Services Canada.
While the report raises concerns about the funding decline, government officials have mentioned that decisions on the extension or augmentation of these programs are pending in the coming years.
The PBO’s report emphasizes the need for an additional 690,000 housing units by 2035 to address Canada’s housing requirements. Build Canada Homes, established with an initial investment of $13 billion, is expected to allocate $7.3 billion towards grants, loans, and community support for low-income rentals, with the remaining $5.7 billion designated for financing programs.
The report suggests that Build Canada Homes is projected to contribute modestly to housing supply and affordability, estimating the construction of 26,000 new units in the next five years, including 13,000 affordable homes for low-income households.
Housing Minister Gregor Robertson expressed optimism about the government’s housing policy and its potential impact on private investment in homebuilding, emphasizing the significant investment aimed at attracting private funding to bolster affordable housing initiatives.