City of Ottawa, feds launch $400 million investment to build homes in Ottawa

New homes under construction in Ottawa on Monday, Aug. 14, 2023. THE CANADIAN PRESS/Sean Kilpatrick

The federal government and the City of Ottawa are teaming up to accelerate construction of up to 3,000 affordable homes in the capital.

Prime Minister Mark Carney announced a new $400 million partnership between Build Canada Homes and the city during a speech at the Mayor’s Breakfast on Monday morning.

Carney says under the plan, Build Canada Homes will deploy financing to “unlock an additional 1,000 non-market housing units in the city’s portfolio.”

“Under this agreement, the city will reduce or waive development charges, permit fees, and property taxes on priority projects for 2,000 new housing units,” Carney said.

“Shovels will be in the ground next year.”

According to the federal government, the city will “fast-track” the construction of 2,000 mixed-income and affordable units on federal lands. Build Canada Homes will deploy financing for 1,000 affordable housing units from the City of Ottawa’s slate of housing projects.

“The partnership will streamline permitting and development timelines to build more homes – and fast," the government said in a media release.

Mayor Mark Sutcliffe told the breakfast that the City of Ottawa has invested $105 million into affordable housing during this term of council.

Sutcliffe says a report will be presented to committee and council early in the new year, “which will lay out all the details” of the plan to build 3,000 homes.

The Liberal government announced the Build Canada Homes agency in September, with a mandate to scale the supply of affordable housing on public land. Ottawa was one of the six cities announced for the first round of projects.

The federal government said, as part of the plan, it would deploy a “direct-build approach” to building housing at the six federal sites, “overseeing and leading construction projects focused on affordable mixed-income communities.”

Housing starts are up 22 per cent in Ottawa this year compared to the year before.

Statistics released by the Canada Mortgage and Housing Corporation last month showed construction began on 7,945 new homes, apartments and condominiums in the January-October period, up from 6,520 units during the same period in 2024.

In September, Sutcliffe unveiled Ottawa’s new Housing Action Plan, looking to boost development. The 53 actions include speeding up the approval process, lowering fees and unlocking urban intensification and transit-oriented development.

Deal shows scope of what needs to be done

Housing advocates are calling this deal a good step.

“It’s a good project; it’s very welcome,” says Jason Burggraaf with the Greater Ottawa Home Builders’ Association. “We need a lot of investment in affordable housing and especially affordable housing units for Ottawa. We could use a lot more, but I think it also illustrates the amount of investment that’s needed from other levels of government to make housing affordable at all. Like we’re devoting $400 million dollars for 3,000 deeply affordable units.  It kind of really illustrates the amount of money it takes to get projects moving right now. That’s great for this context. Why can’t we do that for the entire housing continuum?”

Burggraaf also says that all levels of government need to follow through with promises already pledged.

“We really need this kind of level of investment and really across the board for all housing like, so that every bit of housing market can kind of get moving. And even the promises that have been put on the table already—HST reductions, cutting taxes for all projects, payment in lieu of property taxes, clarifying and confirming what the situation is with going back to work—all these elements are affecting Ottawa’s ability to build and the ability to invest in housing.”

He says with more answers to these promises he expects more people to get into the housing market.

“Everyone’s waiting on the sidelines for them to come through. And then we’re hoping people will jump back into the market, which will kick start things.”

‘Toxic drug crisis’

The prime minister also announced the federal government will provide $1.2 million to the city and the Canadian Centre on Substance Abuse and Addiction to “better respond to the toxic drug crisis in our city.”

“This funding will improve services, provide recreational programs and modernizing data systems across housing, policing and social supports,” Carney said.

Sommet de la Francophonie

Canada will submit a bid to host the Sommet de la Francophonie in 2028 in the national capital region.

Carney announced plans to bid to host the summit of Francophonie countries during the Mayor’s Breakfast.

“La Francophonie represents one fifth of the global economy,” the government said.

“Hosting the Summit will catalyse new economic partnerships across Francophonie countries to deepen trade, attract more investment, and showcase Canada’s proud and distinct French-speaking communities.”

The Francophonie Summit would welcome delegations from 90 countries representing more than 327 million Francophones from around the world.

With files from CTV News Ottawa’s Leah Larocque