The Canadian Home Builders’ Association (CHBA) has released a strategy which highlights the changes required to enable the industry to build 5.8 million homes in the next 10 years to close Canada’s housing supply gap and improve housing affordability.
“What we are tabling is a strategy to support the industrialization of the sector. And just as last year’s federal budget put forth a made-in-Canada plan for a clean economy to address the climate crisis, we are presenting a made-in-Canada plan for housing supply to address the housing crisis,” said CHBA CEO Kevin Lee.
“There has been a lot of coverage in the media talking about solutions to building more homes, but it is important to hear from the home building sector itself – the very people who know first-hand about the challenges and opportunities, who on a daily basis are experiencing what is and what is not working,” Lee continued. “Our Modular Construction Council, and our site-built members, bring a wealth of expertise to the table on how to actually address the barriers to getting more supply.”
CHBA’s Sector Transition Strategy emphasizes that a comprehensive approach is required to pave the way for increased production, beginning with financial and policy changes. This begins with enabling more first-time buyers to enter the market.
A no-cost action for government is introducing 30-year amortization periods for first-time buyers on newly constructed homes which will enable well-qualified buyers who are currently locked out to become homeowners without creating demand in a supply constrained market.
The strategy notes that if Canada can adjust the financial and policy barriers as well as create an environment conducive to additional construction, the residential construction industry will be confronted with more extreme labour shortages. Additionally, changes to the country’s immigration system are also required to proactively attract skilled workers, specifically for residential construction, as well as encouraging Canada’s current population to pursue careers in the skilled trades and support apprenticeship programs.
To double housing starts, the strategy noted that there will need to be a fundamental shift in how homes are built in Canada. While there are various benefits to factory-built homes, factories require high capital investment, high overhead, a steady workforce, and steady throughput; risks that all need to be mitigated.
“The reason we build homes the way we do now is that the sector and its business structures are set up to deal with the boom-and-bust cycles that housing goes through. In order to see a transition to more factory-built systems, government support will be needed initially to substantiate the business case and de-risk the investments,” said Lee.
CHBA’s Sector Transition Strategy outlines the risks and what exactly can be done to mitigate them to facilitate a mass move towards more factory-built homes.
the Strategy outlines the supports required from government to enable industry to meet the challenges of building 5.8 million homes in a decade including regulatory and policy support, targeted programming, strategic financing and investment tax credits.
“CHBA has been engaging with the federal government on the recommendations from this Strategy, and we hope to see support for it moving forward. Canada has a huge housing challenge, but also a huge opportunity—this Strategy outlines how to get there,” said Lee.