Department of Finance Canada introduced Bill C-26, legislation that would authorize federal payments to provinces and territories for housing-supply measures.
Subject to passage, the bill would provide $1.7 billion immediately to support measures intended to increase housing supply.
Finance Canada said the funding could be used for steps such as reducing development fees or levies on new home construction and adding to provincial or territorial housing programs already in place.
The announcement sits beside a broader federal housing package of about $40 billion. Finance Canada connected the bill to Build Canada Homes, a federal agency focused on increasing the pace of homebuilding, including transitional, supportive, deeply affordable, and community housing.
The source also noted pressure in major cities, where new home sales had fallen below historical levels. Finance Canada linked that slowdown to future housing supply and to job losses in skilled trades and construction.
Development charges and levies can affect the economics of a housing project because they add to upfront costs before units are sold or rented. Federal transfers can therefore matter if they help provinces or municipalities reduce those costs or replace revenue that would otherwise come from fees.
The question is whether federal money can lower housing-supply barriers enough for provinces, territories, municipalities, and builders to move more projects forward.