Ottawa's New Housing Supply Act Becomes Law, Unlocking $1.7 Billion for New Construction

Canada's push to fix its housing shortage took a legislative turn last month when Bill C-26, the Improving Housing Supply Act, received Royal Assent on June 18. The short but consequential law authorizes a one-time payment of roughly $1.713 billion to provinces and territories, with the money earmarked to speed up new home construction and cut through municipal red tape.

Finance Minister Francois-Philippe Champagne first tabled the bill in late March as part of the government's Spring Economic Update, which reaffirmed Ottawa's commitment to direct tax relief for new housing alongside the transfer payment. Housing and Infrastructure Minister Gregor Robertson has since described it as one half of a two-law strategy, paired with the Build Canada Homes Act, aimed at restoring affordability for Canadians after years of runaway price growth.

Build Canada Homes, the federal agency the companion act formally establishes, is tasked with financing affordable housing at scale, partnering with private developers on middle-class housing, and fighting homelessness through transitional and supportive units. Since launching in September 2025, the agency has already signed a memorandum of understanding with Quebec and struck similar coordination tables with other provinces to streamline approvals and align federal, provincial and municipal funding.

Industry groups such as the Canadian Home Builders' Association welcomed the funding as reinforcement of commitments made earlier in the year, though some economists note that $1.7 billion is a modest sum next to the scale of Canada's housing deficit, which independent estimates put in the millions of missing units. Much will depend on how quickly provinces deploy the transfer and whether municipalities actually loosen zoning rules in exchange for the money.

For now, the legislation gives Ottawa a concrete legal framework to point to as it fields criticism over slow-moving housing starts, while giving provinces fresh cash to accelerate projects already in the pipeline.