Plan promises fast, affordable builds, but doesn't address who will do the work
Liberal leader Mark Carney has promised to revive a wartime-scale housing strategy that would double Canada's homebuilding output, but industry experts are questioning if Canada has the labour force to make it happen.
Speaking at a trades college in Vaughan, Ontario, Carney laid out a bold plan to ramp up residential construction to nearly 500,000 new homes per year over the next decade. His proposal hinges on the creation of a new federal agency called Build Canada Homes, which would spearhead affordable housing developments, streamline construction, and provide financing to builders.
“We will build at a pace not seen since the Second World War,” Carney told reporters. “By getting government back into the business of building affordable homes and by making the market work better, we will drive a huge increase in housing supply so we can bring costs down for Canadians.”
The agency would act as a large-scale developer, targeting construction on public lands, managing projects, and working with builders of modular and prefabricated housing, a key feature Carney says will keep the homes affordable, sustainable, and quick to deliver. The plan includes $25 billion in financing for prefab housing and $10 billion in low-cost capital for affordable homebuilders.
The Liberals also plan to consolidate all federal affordable housing programs under Build Canada Homes, transferring them from the Canada Mortgage and Housing Corporation (CMHC).
Additionally, they are proposing measures to reduce building costs, including cutting municipal development charges, repurposing existing structures, and expanding the Housing Accelerator Fund, a federal incentive program that encourages municipalities to change zoning rules and boost housing starts.
Carney framed the initiative as a response not only to Canada’s affordability crisis but also to global economic uncertainty, including potential trade tension with the United States.
“We can give ourselves more than any foreign government, including the United States, can take away,” he said. “But to do that, we need to do things that were previously thought impossible, at speeds we haven’t seen in generations.”
The Liberals had previously committed to eliminating the GST on homes sold for up to $1 million for first-time buyers.
Can Canada meet the labour demand?
Still, many in the industry are asking if Canada have the manpower to pull off Carney’s plan.
Labour constraints remain one of the biggest challenges facing Canada’s housing sector. According to CMHC’s 2024 estimates, even with record-high employment in the skilled trades, Canada can build about 400,000 housing units annually — 100,000 short of Carney’s proposed pace.
A separate 2024 report from BuildForce Canada projected that the residential construction workforce would need to grow by 83% from 2023 levels, nearly doubling to just under 1.04 million workers, to meet the federal housing agency’s affordability goal of 5.8 million homes by 2030.
Meanwhile, Desjardins Group also flagged labour, material shortages, regulatory barriers, and limited financing as major roadblocks to scaling up homebuilding, raising doubts about the feasibility of hitting CMHC’s targets.
Read next: Canada invests in skilled trades to tackle labour shortages and housing gaps
Carney’s announcement did not outline specific plans to address the labour shortfall.
In 2023, Canada recorded 245,120 housing starts, up just 2% from the previous year. Monthly data for February 2024 showed a 4% decline in starts on a seasonally adjusted annualized basis.
NDP proposes alternative affordability plan
Over the weekend, New Democratic Party (NDP) leader Jagmeet Singh announced a different approach to tackling the housing crisis, focusing on affordability for buyers rather than new supply.
The plan would offer government-backed, low-interest loans through CMHC for first-time buyers who qualify for a mortgage but can’t manage bank rates.
“It’s never been done before, but if we can give loans to large, wealthy developers to buy buildings, to buy homes, why can’t we give everyday families a break?” Singh said.
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