The 2023 Federal Budget Misses the Mark on Affordable Housing
29 March 2023 
The Honourable Chrystia Freeland, Deputy Prime Minister and Minister of Finance tabled Budget 2023—A Made-in-Canada Plan: Strong Middle Class, Affordable Economy, Healthy Future on March 28, 2023. It is a budget the minister describes as “a path forward for building a stronger and more resilient economy for everyone.”
We appreciate the focus on improving social supports for low-income Canadians in this time of economic insecurity. However, we are extremely disappointed to see a lack of significant new investments in affordable housing among these measures. Indeed, no number of social supports will do more for low- and middle- income Canadians than ensuring that everybody has access to a safe, secure, affordable place to call home. And without a place to call home, the benefit of social supports will be moot.
Our national partners—the Canadian Housing Renewal Association (CHRA), the Co-operative Housing Federation of Canada (CHF) and the Canadian Alliance to End Homelessness (CAEH)—advocated for investments in key areas that could empower the community housing sector to deliver more affordable housing in perpetuity. Unfortunately, most of their asks didn’t make it into the new budget.
The (small) Hits
The budget did contain some encouraging, if incremental, announcements for affordable housing. It also included updates on 2022 budget commitments, including the launch of the Housing Accelerator Fund and increased flexibility on how the Co-Investment Funds can be used. However, we worry that without significant new investments, such flexibility in using funds originally intended for repairs for new construction will put existing affordable housing at risk. This is especially true in B.C. where the supply provisions of the Co-Investment Fund have been tough to implement.
We also acknowledged the new funding for Indigenous housing containing in the budget but remained concerned about its slow roll-out and continued colonial nature.
The (BIG) Misses
These small hits are overshadowed by some big misses. Housing is the largest monthly expense for most households, and as rental costs surge investments in creating new affordable and secure housing options are urgently needed. The incremental steps in this budget fall far short of the big steps needed to address the worsening housing crisis faced by low- and middle-income Canadians.
No expanded investments to accelerate the construction of affordable housing.
Despite increased investment in housing in recent years, the data on housing need and construction shows we are still far from achieving the goals of the National Housing Strategy. In fact, a recent study found that Canada would have to double its affordable housing stock to reach the OECD average (number of affordable housing units as a share of the total stock).
This affordable housing backlog continues to grow due to the effects of inflation, increasing land and construction costs, rising interest rates, and the financialization of housing. Moreover, measures that prioritize homeownership over rental and affordable housing construction will not address the needs of low- and moderate- income households in Canada.
No National Housing Acquisition Fund
A critical missed opportunity in Budget 2023 was the lack of commitment to preserving existing affordable rental homes. Our friends at CHF Canada and the Canadian Housing Renewal Association (CHRA) lobbied the federal government to follow BC’s example, and develop a national affordable housing acquisition fund. This fund would enable the community housing sector to purchase private rental housing when it is put on the market to preserve and enhance rental and co-op housing options.
Research by the B.C. Non-Profit Housing Association (BCNPHA) illustrates that supporting the acquisition existing rental buildings by the community housing sector is a faster and more cost-effective way of protecting the affordable rental housing we already have. For every new affordable rental or co-op home that is built, three more are lost to investors, conversions, demolition and rent increases. Supporting the community housing sector acquire existing housing would help slow the significant erosion of rental homes available to low- and moderate-income British Columbia households over the past decade.
Piecemeal funding for a urban, rural and northern Indigenous Housing Strategy
Budget 2023 also fell short of meeting the housing needs of Indigenous people in Canada. It announced $4 billion over the next seven years for Indigenous housing. This is only only a fraction of what’s needed and it not scheduled to be release until 2024.
However, the overall funding for such a strategy fails to meet the National Housing Council [PDF] recommended minimum investment of $6.3 billion over the next two years and fall far short of the $56 billion they calculate is needed in the next decades to address the current shortfall in URN Indigenous housing. Any notion of reconciliation is inadequate without a fully funded Indigenous Housing Strategy.
Furthermore, the budget indicates that the funding for the URN Indigenous Housing Strategy will be delivered by the Canadian Mortgage and Housing Corporation (CMHC), rather than by an Indigenous-led organization. While there is a commitment to co-developed the strategy, this falls short of the For Indigenous, By Indigenous strategy called for by Indigenous organizations and the Canadian Housing and Renewal Association. An Indigenous-led approach is also consistent with Canada’s obligations under the UN Declaration on the Rights of Indigenous Peoples.
Missed opportunity to update the National Housing Strategy
As the Canadian Housing Renewal Association (CHRA) notes [PDF], Canada’s economic picture has changed dramatically since the National Housing Strategy was announced in 2017. Programs that were created at a time of low interest rates and stable construction costs are simply no longer adequate. Adjustments are urgently needed so the NHS can meet current challenges including high interest rates, the deepening housing crisis, and the ongoing impacts of the COVID-19 pandemic.
Final Impressions
Overall, Budget 2023 misses the mark on affordable housing in Canada. It fails to build a stronger and more resilient economy for everyone. In particular, it does nothing new to preserve, and enhance, much needed affordable housing options for low- and middle- income people. Instead, it puts existing affordable housing at risk. And it continues the piecemeal, and colonial approach to Indigenous housing needs.