CHBA Releases Strategy for Building 5.8 Million Homes

FEBRUARY 8, 2024 – OTTAWA, ON – The Canadian Home Builders’ Association has released a strategy detailing changes and supports needed to enable the industry to build 5.8 million homes in the next decade 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, though focused on labour and productivity with pragmatic recommendations related thereto, emphasizes that a comprehensive approach is needed to set the stage for increased production, starting with financial and policy changes to pave the way. This starts with enabling more first-time buyers to enter the market. A simple, no-cost action for government is introducing 30-year amortization periods for first-time buyers on newly constructed homes. This will enable well-qualified buyers who are currently locked out to become homeowners without creating demand in a supply constrained market, since only new homes would be eligible for the longer amortization, thereby creating more housing supply.

If Canada can fix the financial and policy barriers and create an environment conducive to additional construction, the residential construction industry will be confronted with labour shortages even more extreme than they are currently. Changes to Canada’s immigration system are needed to proactively attract much-needed skilled workers, specifically for residential construction, in addition to encouraging Canada’s current population to pursue careers in the skilled trades and support apprenticeship programs.

But ultimately, to double housing starts, there will need to be a fundamental shift in how homes are built in Canada in order to increase productivity, given the limited number of people who will be available. To achieve this, a shift towards more factory-built construction makes sense, but only if the right environment can be created. There are many benefits to factory-built homes, but factories require high capital investment, high overhead, a steady workforce, and steady throughput—risks that 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,” says Lee.

CHBA’s Sector Transition Strategy outlines what those risks are and what can be done to mitigate them to facilitate a mass move towards more factory-built homes, which, among other benefits, allow for faster construction with fewer delays, and will require less of a ramp up in labour.

From regulatory and policy support, to targeted programming, to strategic financing, to investment tax credits, the Strategy outlines the supports needed from government to enable industry to meet the challenges of building 5.8 million homes in a decade. “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,” concluded Lee.

CHBA’s Sector Transition Strategy can be found here: www.chba.ca/SectorStrategy.

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MEDIA INQUIRIES
Journalists wishing to interview Kevin Lee, Chief Executive Officer of the Canadian Home Builders’ Association are encouraged to submit their request by email to media@chba.ca.

ABOUT THE CANADIAN HOME BUILDERS’ ASSOCIATION
The Canadian Home Builders’ Association (CHBA) is the voice of the residential construction industry in Canada, representing some 8,500 member firms across the country. Our membership spans new home builders, renovators, developers, trade contractors, building material manufacturers and suppliers, lenders, and other professionals in the housing sector.