What Budget 2021 Means for Affordable Housing in Canada
In April 2021, the Canadian government unveiled its plan for ensuring a robust economy in the aftermath of the COVID-2019 pandemic. This plan, called Budget 2021: A Recovery Plan for Jobs, Growth, and Resilience (or Budget 2021 for short), is intended to create jobs and a robust Canadian economy. It also includes investments to make housing more affordable for vulnerable populations.
Experts have noted that Canada’s economy was weaker going into this last recession than it was for the five previous recession periods, which means we’ll need a solid plan to pull out of it and build an economy that is stronger than it was before.
Who is Vulnerable in Canada?
While numbers can vary, pre-pandemic reports estimated that about 35,000 Canadians experience homelessness on any given night, and at least 235,000 Canadians experience homelessness throughout any given year. Those numbers likely increased due to the pandemic, with thousands of people losing their jobs and being forced out of their homes.
Homelessness is spread out across demographics in Canada, although some populations are more vulnerable than others. Those populations include Indigenous people, women with children who are fleeing violent situations, single adult men, and people of all genders struggling with addictions and mental health conditions.
5 Ways Budget 2021 Will Increase Affordable Housing
There are several ways that Budget 2021 addresses the issue of affordable housing. Here are five specific ways Budget 2021 intends to combat homelessness and increase affordable housing for Canadians.
- Add thousands of new affordable housing units
Budget 2021 proposes to add at least 4,500 new affordable units to Canadian housing with a $1.5 billion investment to the Rapid Housing Initiative (RHI). These 4,500 new units will join the existing 4,700 units that were funded with a $1 billion investment under the 2020 Fall Economic Statement.
At least 25 percent of the $1.5 billion budget will go toward funding housing projects that are focused on women. The goal is to provide housing for vulnerable populations quickly.
- Expand the Affordable Housing Innovation Fund
The Affordable Housing Innovation Fund is a $200 million fund that aims to encourage funding models for affordable housing and fight against homelessness across Canada. Budget 2021 seeks to add another $600 million to expand the fund and create an additional 12,700 housing units over the next seven years.
- Double funding for Reaching Home
The Canadian government has actively increased funding for Reaching Home: Canada’s Homeless Strategy throughout the pandemic. Budget 2021 proposes to continue this trend by providing $567 million over the next two years. It also suggests adding $45 million to create a pilot program dedicated to reducing homelessness among veterans.
- Add more funding specifically for victims of domestic abuse
As we mentioned above, women with children fleeing from violent situations are at a higher risk for homelessness than other populations. To help these women and their children, Budget 2021 proposes funding Canada Housing Benefit with $315.4 million over the next seven years. This money is intended to increase direct financial assistance for low-income women and their children.
- Convert empty office space
The prevalence of remote work during the pandemic has left many office spaces vacant. Several businesses that have managed to survive are downsizing their workforces or moving their operations entirely online. Budget 2021 seeks to leverage newly emptied office space by converting it into housing. It proposes allocating $300 million from the Rental Construction Financing Initiative for this purpose.
We’re keeping up with the latest housing news in Canada. Feel free to reach out with any questions about the government’s latest initiatives to build affordable housing and combat homelessness.