The federal government and the City of Toronto have announced a more than $2.7 billion housing partnership aimed at accelerating rental construction and tackling the city’s housing shortage.
Prime Minister Mark Carney and Toronto Mayor Olivia Chow unveiled the initiative on Wednesday, saying the investment will support more than 18 housing projects over the next three years, delivering over 5,600 new rental homes across Toronto. Construction is expected to begin on more than 4,500 units before the end of 2026.
The entire portfolio will consist of rental housing, including affordable, supportive, rent-geared-to-income and rent-controlled units.
The initiative will be delivered through two funding streams:
- Build Canada Homes will provide more than $310 million to support nine non-market housing projects on City-owned land, creating nearly 1,900 rental homes, including more than 700 affordable and supportive units and over 1,100 rent-controlled homes. The City of Toronto will contribute public land at nominal cost along with more than $530 million in funding, incentives and property tax exemptions.
- Through the Canada Mortgage and Housing Corporation’s Apartment Construction Loan Program, the federal government will provide more than $1.8 billion in low-cost financing for nine market-rental developments, delivering over 3,700 rental homes, including more than 1,000 affordable units. Ottawa also committed up to $600 million in additional financing for future Toronto housing projects.
The partnership also includes a 100-unit Indigenous-led supportive housing project at 15 Denison Avenue and promotes innovative construction methods such as mass timber and volumetric modular building to reduce construction time, waste and emissions.
The housing projects are expected to support approximately 2,100 construction jobs annually and prioritize the use of Canadian steel and lumber under the federal government’s Buy Canadian Policy.
The announcement builds on Ottawa’s broader housing strategy, including the launch of Build Canada Homes, which has already committed to nearly 17,000 housing units through 17 partnerships nationwide. The federal government also highlighted measures such as eliminating the GST on qualifying new homes for first-time buyers and partnering with Ontario to reduce development charges for new housing projects.
Prime Minister Mark Carney said the partnership demonstrates how governments can work together to deliver affordable housing, while Mayor Olivia Chow said the investment will help more Torontonians find homes they can afford and remain in the communities they call home.
