In a notable development for Canadian municipalities, Canada’s Housing Minister Sean Fraser has made it clear that access to the federal housing accelerator funding will be contingent on the adoption of zoning reforms. Addressing an audience at the Empire Club of Canada luncheon in Toronto, Fraser pointed out that the willingness to reform zoning regulations has been a decisive factor for communities that have successfully secured deals with Ottawa. This stance has already prompted a swift change in approach from cities that were initially resistant, driven by the competitive nature of the funding program.
The Housing Accelerator Fund, which includes $4 billion in federal funding and runs until 2026-27, is aimed at spurring housing supply creation across Canadian municipalities and Indigenous governments. To date, 22 agreements have been signed under the program, with St. Catharines, Ontario, and Saint John, New Brunswick, being the latest to join. The fund, managed by the Canada Mortgage and Housing Corp., highlights the end of exclusionary zoning as a crucial best practice for successful applications. Such zoning practices typically restrict low-density development and limit affordable and social housing in residential areas, and the push is now towards promoting mixed-use development and high-density residential areas, especially near urban centers and transit corridors.
Fraser’s remarks also shed light on the competitive nature of the application process. Out of approximately 540 applications, only about 150 are expected to be successful. He emphasized that most cities that have finalized deals with the federal government have effectively ended exclusionary zoning practices. The message to Canadian cities is clear: those not demonstrating sufficient ambition in zoning reform and permitting processes are unlikely to receive funding. This policy links financial support to proactive urban planning reforms, marking a significant shift in Canada’s approach to addressing its housing challenges.
