Who’s Going To Build Homes: Home-Builders Or The Government?

Setting a goal is easy.  Achieving the goal is hard.

It’s kind of funny what you remember from your formative years.

It’s also funny what you learned in elementary school, high school, or university that you hold near and dear today.

I had a homeroom teacher in grade seven who changed the way I thought about school, for the better, of course, but whom I can credit for much of my learning moving forward, as well as many of my attributes to this day.

He was different.  His methods were different.  Everything he did was different, much of which contradicted what we learned previously with other teachers.

He gave us so much freedom, not just of action, but expression, and thought.

Many kids can’t handle this.  I almost couldn’t, at first.  I was a shit back then.  He knew it.  I eventually knew it.  But about halfway through the year, everything just “clicked” for me.

When I speak of “different methods,” here’s an example: he was the first teacher to ever introduce grading by peers.  You’d do a presentation, and while the teacher himself provided a grade, three other kids in the class, whom he called “adjudicators,” would also provide grades.  Collectively, you were judged and graded by your teacher as well as your peers.

This would never happen today, of course.  I’m sure they’ve done away with grades in public schools entirely.  God forbid we provide feedback to children who underperform, that they, well, underperformed, but I digress.

One of the concepts that my teacher introduced to me at the tender age of twelve was that of goal setting.

I had never given a single thought to how I expected to perform in a given subject, in a given school year or semester, nor did I give any thought to how I wanted to perform.

My teacher ensured that we all thought about it, and regularly.

But as I learned throughout the year, setting a goal was one thing, but achieving it was another.

“Anybody can set a goal,” he told me.  “But achieving the goal is hard.”

It made sense after it was pointed out to you, but the follow-up question was a real thinker.  He asked me, “How do you achieve the goal?”

I had no idea.

I thought we’d simply set a goal, then compare it to the eventual results.

But my teacher taught me that you needed a plan as well, and this is something that so many people lack when setting a goal.  You need checks and balances too, as well as performance indicators that are monitored along the way.

In my industry, I see this all the time.

Real estate agents are notorious for setting goals but having absolutely zero idea of how to achieve them.

An agent might offer in January, “I want to sell twenty properties this year.”  But what is that based on?

Desire?

It’s not enough.

A goal needs to be rooted in reality; otherwise, it’s beyond desire – it’s fantasy.

When I look at the state of housing in this country, I can’t help but come back to the idea of a “goal” and what that means.

Nothing.

A goal means nothing.  That is, it means nothing unless you have a plan on how to achieve it.

For the better part of fifteen years, the “problem” in our housing market was too much demand.

That was the issue, right?  That was the reason why prices were increasing, according to the government mouth-pieces and industry onlookers, and thus we saw a slew of regulatory changes aimed at “cooling the market” by removing excess demand.

We can agree or disagree on the definition of “excess,” but it seemed that those in charge planned to stop price acceleration by making it more difficult to buy.

Once upon a time, you could obtain 107% financing on a purchase, if you can believe that.  I had a client buy a home in 2006 for $1,000,000, and he was advanced $1,070,000 by the lender, plus his $50,000 deposit back as well.

Some time thereafter, the CMHC mandated (gasp!) a minimum 5% down payment, and this took demand out of the market.

Then the CMHC mandated a 20% down payment on second properties, which was a game-changer for investors.

A few years later, the CMHC introduced a minimum down payment of 20% for purchase prices over $1,000,000, which was another game-changer, and was also supposed to take demand out of the market.

We saw all kinds of other measures introduced by the CMHC, which were aimed at “cooling the market,” from increased CMHC insurance premiums to this little thing called the “stress test.”

But after fifteen years and a dozen policy changes, it became clear that this wasn’t going to work.  We discussed this on Toronto Realty Blog for just as many years, and were excited and elated when people finally suggested that we look at supply instead of demand.

The chatter began pre-pandemic, but it wasn’t really until the last federal election that politicians started making promises.

In April of 2025, the three major parties offered these promises with respect to housing:

Liberals – Double the current pace of construction to 500,000 new homes per year in a decade.

Conservatives – A 15% increase in the number of new homes each year, which would double the current pace in five years.

NDP – Three million homes built over the next five years.

My grade seven teacher would go nuts.

Without an actual plan, this is all just fantasy.

The craziest part about this was that the three parties all made these “promises” without actually looking to do anything themselves.  All three parties felt that they could “incentivize” the municipalities, who would, in turn, incentivize builders.

Because we’re not actually talking about the government building housing, right?  At least, we weren’t yet.

Here were the three respective “plans” released:

Liberals – Provide $4 Billion over four years toward housing-related infrastructure in cities that agree to higher-density housing and faster permit approvals.

Conservatives – Require all cities to increase the number of homes built by 15% each year, and would withhold a portion of federal funding from those municipalities who fall short.

NDP – Double the size of the housing accelerator fund to $8 Billion over four years, make it permanent, and rename it the Canadian Homes Transfer.

Um, okay.

Why wouldn’t the NDP triple the amount?  Or quadruple?

These parties didn’t have any plans.  These were just words, and the words were being said to get elected.  If these parties really wanted to get elected, they should have just come out and promised to build every person in Canada a house, inside of six months, that would only cost $250,000, and which would be paid back with zero percent interest.

The problem with that, however, is that there would still be people who would complain that $250,000 is too much…

And don’t get me wrong, it wasn’t just the federal government (or those running for federal office) who were making promises.

The Ontario government promised to build 1,500,000 homes by 2031 back in 2022 with the ridiculously-named “Build More Homes Faster Act.”

Last week, I was spectacularly unsurprised to see this headline in the media:

“Ontario Appears To Back Away From Goal Of Building 1.5 Million Homes In 10 Years”
CBC News
October 23, 2025

This quote from Municipal Affairs & Housing Minister, Rob Flack, says it all:

“Simply put, it takes too long and it costs too much to build infrastructure and homes in Ontario.”

No kidding?

My grade seven teacher would say, “Setting goals is easy.  Achieving goals is hard.”

To be fair, Mr. Flack wasn’t offering this as an excuse as to why homes aren’t being built faster, but rather offered this as he lamented what we already know, and introduced legislation aimed at streamlining approvals.

But the problem with homebuilding can be found in this excerpt from the article:

“This legislation continues to build on the work we have done previously to create the conditions (for) homebuilders to do what they do best and that is to build.”

But when asked if it would spur the industry enough to allow the province to reach its 1.5 million home goal, Flack was noncommittal.

“I’m committed to getting shovels in the ground faster,” he said. “I’m looking at the next six to 12 months to get this thing kick started. The future will be the future. We’re in a housing crisis. We get it.”

See the problem?

The municipal, provincial, and federal governments are all relying on homebuilders to build homes.

As they should, of course, and we’ll come back to the ridiculous idea of Mark Carney building houses in a moment.

But the problem with the “plans” introduced by every party, from every level of government, is that they’re trying to “create conditions” that allow homebuilders to build.  That’s it.  That’s their plan.

My grade seven teacher would wonder how one could set a personal goal while entirely relying on another person to achieve it.

More from the article:

Homebuilders have said that some of the most helpful measures governments could take to encourage development would be to reduce taxes and fees.

Measures in Flack’s legislation include prohibiting the city of Toronto from requiring green roofs and taking aim at other so-called green standards, speeding up the establishment of transit-oriented communities, allowing some minor variances as of right and facilitating faster minister’s zoning orders, which allow normal planning processes to be circumvented.

Prohibiting the city from requiring green standards?

Finally, a great idea!  Disagree with me at your peril, but we’re having enough trouble building housing as it is, so now isn’t the time to start tying other goals and policies into homebuilding, especially when they complicate the process and increase the cost.

I also read this article last week:

“Backlog of 1.2 Million Planned Homes In Toronto-Hamilton Not Being Built: Report”
National Post
October 21st, 2025

This one is also from the files of “no surprise here.”

But this article, however, talks about how houses that are already approved are not being built.

From the article:

The report, to be released Tuesday by cross-sectoral group CivicAction, says that backlog in the Greater Toronto and Hamilton Area (GHTA) and across the country is a major factor in Canada’s housing crisis.

The gulf between the planned homes and those actually getting built, CivicAction says, is a result of a wide variety of structural bottlenecks, including: municipal planning departments are designed for building levels of the past, not what is needed today; financing models favour high-priced developments, not the homes that middle-class Canadians can afford; and skills shortages in the construction industry.

So the approvals are a problem, but also, they’re not?

The additional problems now are price and the lack of appropriate labour needed?

Just add that to the growing pile of reasons.

So is now the time for the government to go into the home-building business?

Recall this press release from last month:

Prime Minister Carney Launches Build Canada Homes To Supercharge Homebuilding Across The Country
September 14th, 2025

I know that people desperately want to think that their elected government body not only has their best interests at heart, but also knows how to best go about achieving them, but putting the government in charge of home building is a disaster waiting to happen.

Just read this excerpt:

Build Canada Homes will place an intense focus on using cost-efficient and modern methods of construction such as factory-built, modular, and mass timber. Through bulk procurement and long-term financing, Build Canada Homes will mainstream these advanced methods of construction – with the potential to cut building timelines by up to 50%, reduce costs by as much as 20%, and lower emissions by approximately 20% during construction. To supplement these efforts, wherever possible, Build Canada Homes will prioritize low-carbon materials, low-carbon technologies, and efficient design. This will help catalyze a new housing industry – one that builds faster, and more sustainably, 365 days a year.

Does anybody believe this?

Since when does the public sector reduce costs?  Everything costs more when it’s run through the pockets of the government first.

This is absolute fantasy, and at a cost of $13 Billion, which apparently is for 4,000 homes.

Now, much has been made of the math here!

Some people are saying that the $13 Billion is for 4,000 homes, which means we’re spending $3.25 Million per home, but others are defending the federal government and saying that the two figures are not linked.  If that’s the case, then I’d love to know: (a) the cost to build each of these of homes is, (b) what else the $13 Billion is going towards.

If you follow the Fraser Institute, then you might have already seen this, but it’s worth a read:

“Federal Government Wants To Build 4,000 Homes Despite Years Of Real Estate Mismanagement”
Fraser Institute
September 26th, 2025

From the article:

Prime Minister Mark Carney recently launched his new “Build Canada Homes” federal agency, which will help build “4,000 factory-built homes” at an initial cost of $13 billion. In light of the affordability crisis that’s plagued large swaths of the country, many Canadians likely welcome more government involvement in the housing sector. But does Ottawa have the ability to efficiently and effectively build homes?

To help answer that question, it’s helpful to consider the federal government’s real estate record. Most Canadians probably aren’t aware that the government owns a bloated portfolio of underused office space, yet efforts to shrink this portfolio have moved at a glacial pace. In 2017, the government acknowledged that half of its office space was underused. But it took until 2019 to formulate a plan to sell off these properties, and by 2023 the federal office footprint (managed by the Department of Public Services and Procurement) was barely reduced—from 6.0 million to 5.9 million square metres.

In light of this failure, the government in 2024 dedicated $1.1 billion in taxpayer money, over 10 years, to hasten the sale of underused federal properties and save taxpayers $3.9 billion in the first decade and $0.9 billion annually thereafter.

Unfortunately, this initiative is already failing. The original goal was to cut the federal office footprint by 50 per cent by 2034, but the government’s current projections envision only a 33 per cent reduction. That means taxpayers will shoulder the cost of maintaining more underused office space each year. And even after a decade and $1.1 billion spent, Ottawa will still be left with roughly one million square metres of idle federal office space.

Why?

According to an auditor general report released in 2025, the federal government lacks even basic data on its own real estate portfolio, routinely misses internal targets for consolidation, and continues to rely on a lengthy process that takes six to eight years to offload surplus buildings. Poor cooperation between federal departments has made matters worse. Nearly half of the largest departments have refused to sign space-reduction agreements, especially those that paid no rent and therefore had no clear financial incentive to give up empty offices.

These failures raise a key question: If the federal government cannot efficiently downsize its own office footprint—despite ample funding and years of effort—how can it credibly promise to deliver complex housing projects?

Which takes us back to the Carney government’s new federal agency, Build Canada Homes (BCH), which plans to develop affordable housing and accelerate housing innovation. But BCH will likely face the same pitfalls that plagued Ottawa’s real estate downsizing effort—namely, poor coordination across the government, competing political priorities, and no real pressure to deliver.

The plan for BCH relies on federal departments to work smoothly with each other, the provinces, municipalities, Indigenous governments and the private sector. BCH is already weighed down by competing mandates. It promises to develop more affordable homes, but only if they’re built with Canadian-made and climate-friendly materials. These goals are at odds. If a product requires a government mandate to be used, it’s not the most cost-effective option.

And taxpayers will give BCH $3.5 billion a year without any clear indication of what we’ll get in return. BCH’s plan promises “significant” numbers of “affordable” homes—with no indication of how the government will measure progress or affordability. How will Canadians know whether the program is on track? Or if it provides good value for tax dollars? These are fundamental questions, especially since there’s a clear risk that BCH spending may simply compete with private-sector development rather than add greatly to the overall stock of houses.

The stakes are high. If Build Canada Homes underperforms, Canadians could be left with few new homes and a considerable bill. Ottawa cannot efficiently downsize its own office footprint despite ample funding and years of effort. That record hardly inspires confidence in its promise to deliver complex housing projects across the country.

This stinks.

And even worse is that we’re still watching politicians talk out of both sides of their mouths with respect to home prices, as seen here:

“Average Home Price Must Fall In Canada To Restore Affordability”
Toronto Star
October 20th, 2025

Explain this to me:

“The average price of housing – not necessarily individual home values, must fall to restore affordability in Canada.”

Ah, I see what you did there.

You’re trying to appeal to both existing homeowners, who don’t want their home values to fall, as well as appeal to would-be home buyers, who want lower prices.

Oh, politics!

Is it any wonder why we can’t actually get anything done around here?

So who is it, folks?  Who’s going to build housing?

Is it the government or is it the folks who are actually in the business of building homes?

It’s clear that our goals aren’t going to be met on this one, but we should have known that coming into this one.

Perhaps the next time our government wants to promise something they can’t deliver, over which they have no control, they can put a little research into the viability of their goal first.

That would have satisfied my grade seven teacher, so it should be good enough for 42 Million Canadians…