Feds, Ontario reach $357M agreement for affordable housing

The federal and Ontario governments have reached an agreement on a national housing strategy that will unlock $357-million for affordable housing after months of negotiations.

The governments announced the news in a joint release on Tuesday morning after Ottawa had initially pledged to withhold funding earmarked for Ontario because it “failed to meet its obligations.” 

As part of a bilateral housing agreement signed in 2018, the federal government previously pledged to deliver funding if the province reached a target of 19,660 new affordable housing units by the end of 2028.

Officials previously noted that the province was greatly behind on their goal, with an anticipated 1,184 new units by the end of 2024-2025.

In March, Federal Housing Minister Sean Fraser expressed concern in a letter to his provincial counterpart, noting that it is “not realistic” for the province to reach 94 per cent of its target in the next three years.

“I cannot accept an Action Plan that demands funding for affordable housing that will never be built,” Fraser wrote at the time.

Yet on Tuesday, the impasse appeared to be cleared after Ontario submitted a revised action plan.

“Canada and Ontario recognize that our collaboration is imperative to solving the housing crisis,” the joint release stated.

The province says the revamped plan provides more robust data and insights on which housing projects currently get provincial funding. Other measures include: establishing provincial supply targets with service managers, directing funding toward new projects, setting annual goals, and implementing reporting mechanisms.

In order to secure continued federal funding, Ontario is pledging to submit another action plan for 2025-2028 by Dec. 31.

“Solving the housing crisis requires a Team Canada approach. We will continue to work together, along with our municipal partners, to make sure the people of Ontario have the homes they need,” the release concluded.