The Political Labyrinths of the Housing Crisis

What are the powers and responsibilities of different levels of government regarding housing?

Photo by Blue Jay Walker

This originally appeared on Pivot in French, and has been translated by us for all those who are interested.

Who is responsible for housing in Quebec and Canada? Nothing could be less clear.

This explains why things have worked out in this way. What is clear is that the various political levels must cooperate if they want to resolve this housing deadlock.

The housing crisis is complex and multi-factorial, involving several levels of government: federal, provincial, and municipal. Each plays a key role—sometimes complementary, sometimes in tension—in planning, funding, and regulating housing.

Francis Cortellino, an economist responsible for market analysis at the Canada Mortgage and Housing Corporation (CMHC), explains that cohesion among the different levels could be more effective.

“Housing is complex: there are three levels of government, the private industry, community groups, and non-profits. We must find ways for all these players in the ecosystem to work in the same direction, ideally prioritizing social housing,” he said. “In Quebec, there are provincial and federal agreements: the federal government provides funds to the Quebec government, which then manages its programs. But this isn't the case in every province.” He also highlighted the slowness of municipal initiatives, which struggle to build momentum due to either a lack of funding from higher levels or difficulties obtaining the necessary permits.

Federal government: Structuring programs

The federal government, though more distant from daily housing management, plays a central role in funding, coordination, and large-scale policy enactment.

In 2017, Ottawa launched the National Housing Strategy, a “$115 billion investment plan to ensure more Canadians have a home,” spanning ten years.

The federal government also manages several housing-related programs, such as the National Housing Co-Investment Fund (NHCF), the Rapid Housing Initiative (RHI)—offering capital contributions for quickly building new housing or acquiring existing buildings for renovation into permanent affordable housing—and the Tax-Free First Home Savings Account (FHSA). (Under the Carney government they have announced Build Canada Homes, however we have yet to see what that will be.)

The Canada Mortgage and Housing Corporation (CMHC), a federal agency, collects essential data on the housing market and oversees several of these initiatives.

However, in the 1990s, decisions by various federal governments, such as the Conservatives in 1990 and the Liberals in 1994, ended commitments made with provinces in the 1980s.

For instance, the federal government stopped investing in public housing management; previously they absorbed part of the deficit of new social housing across Canada. Moreover, the federal housing cooperative program, the only program allowing income diversity, was abolished as of February 1992.

Provincial governments: Regulation and Divestments

Provinces have direct constitutional responsibility for housing and social welfare. They regulate residential tenancy laws, tenants' rights, housing assistance, and residential construction.

For example, Ontario manages the Residential Tenancies Act, governing tenant-landlord relations. Quebec administers the Tribunal administratif du logement and develops its own social housing programs, such as the Programme d’habitation abordable Québec (PHAQ), and the Société d’habitation du Québec (SHQ), who manage various housing programs and services. British Columbia funds BC Housing, which manages thousands of subsidized housing units.

Several provinces have been criticized for gradually withdrawing from social housing funding since the 1990s, increasingly shifting responsibility onto municipalities without providing adequate resources.

Municipalities: Between a rock and a hard place

The city of Longueuil is exemplary in terms of developing social housing.

In December 2024, Longueuil's mayor, Catherine Fournier, announced nearly 474 social housing units that would open in 2025. A first project worth over $17 million is under construction at the intersection of Bourassa Street and Chemin du Coteau-Rouge, benefiting around thirty people. The city anticipates approximately 2,247 new units within the next several years.

However, Fournier stresses the need for political will to drive change. “All levels of government bear responsibility, but to what extent? When everyone is responsible, it feels as though nobody is. We pass the buck around, making it hard to identify leaders. Amidst the resulting confusion, significant leadership and political will are essential to succeed,” she said.

Municipal governments are the closest to the ground but have the least financial means. Their roles include urban planning, issuing building permits, and zoning management.

Yet several Canadian municipalities have been accused of fostering a “culture of refusal” regarding urban densification, under citizen pressure against high-rise or high-density housing developments. Restrictive zoning regulations (particularly regarding multifamily housing) further slow the construction of affordable housing, especially in major centers like Toronto and Vancouver.

Cities have attempted various approaches: Montreal adopted the regulation for a mixed metropolis (20-20-20), promoting social, affordable, and family housing in new developments (though it faces limitations). Vancouver pushes for increased density around transit corridors with projects like TransLink.

Benoit Dorais, mayor of Montreal's Southwest borough and housing lead for the city, believes the crisis will ease through initiatives like social diversity.

He also emphasized not waiting for funds from other levels. “We consider this an interim period during which we invest,” he said. Montreal has committed one million dollars annually for three years to support housing non-profits, a project not funded by the province.

“Of course, we prefer government funding, and we advocate for it. Many people have pressured Quebec, and we will assist,” Dorais said. Catherine Fournier said that cities like Longueuil and Montreal have more means than smaller municipalities to advance housing projects.

Nevertheless, without strengthened financial support from higher governments, all municipalities, regardless of size, have limited manoeuvring room.

The housing crisis in Canada highlights fragmented responsibilities and poor coordination among government levels. Each has a role, but policies can be incoherent, redundant, or inadequately integrated. “Everyone wants to contribute, but no one has the same game plan,” Francis Cortellino said.

“Canada's housing crisis cannot be solved without an integrated, cooperative approach among government levels,” Marie-Josée Houle, Canada's federal housing advocate, said. “The challenge is to create governance frameworks where funding, regulation, planning, and social services align, with clear objectives, accountability mechanisms, and transparency.”

The latter is sometimes lacking, as we'll explore in the next article.

This investigation was made possible through a grant of excellence from the Association des journalistes indépendants du Québec (AJIQ).