Ahead of Budget Day on April 16, Prime Minister Justin Trudeau made a series of announcements previewing items from Budget 2024, a majority of which were focused on housing.
One of the biggest announcements came on April 4: the Government of Canada is creating a Canada Rental Protection Fund that will provide money to non-profit organizations that allows them to acquire existing affordable housing, preserving those homes and shielding them from potential redevelopment and/or significant rent increases.
The money will be provided in two ways: grants and loans. Trudeau said a total of $470M in grants and $1B in loans would be provided through the Canada Rental Protection Fund, which will be "co-led and co-funded by the federal government and other partners."
Once we got to April 16, however, the full budget revealed that the grant total was actually $477.2M and that only $5M has been earmarked for the first year, 2024-2025, followed by approximately $120M in each of the subsequent four years. It also provided no details about the loans.
Budget 2024 allocations, in millions of dollars.(Government of Canada)
“The initial grant allocation will not move the needle in preserving rental property," said Katie Maslechko, CEO of the BC Rental Protection Fund, in a press release last week. "The federal government has just introduced the most ambitious housing investment in over 50 years, but that investment will not make the impact it needs to if we are losing 10.5 instead of 11 homes for every new home we build."
"We were definitely thrilled to see [the Canada Rental Protection Fund] land in the budget, but it's a little bit underwhelming in terms of how much of the grant dollars will be flowing in that first year," Maslechko said in an interview with STOREYS this week. "You'd be lucky if that would secure you two of three buildings, and probably not in Ontario or BC."
In terms of the amount of units, the BC Rental Protection Fund estimates that even if the $5M is matched dollar for dollar by both private capital and provincial contributions, only 200 units could be protected — nationally.
Nonetheless, the Fund and Maslechko are very happy to see the Canada Rental Protection Fund, which appears to be closely modeled after BC's $500M fund, without the loan component. Earlier this year, the BC Rental Protection Fund became a member of a coalition of organizations that were advocating for a federal version of the program they called the Canadian Housing Acquisition Fund. Now that the Canada Rental Protection Fund is coming, the BC Rental Protection Fund and Maslechko are hoping to share some of its knowledge with the federal government.
"Here in BC, we've learned so much over the past year that we want to be able to share with them, so that this can be delivered as quickly and efficiently and impactfully as possible," says Maslechko.
"Part of the reason we had banded together with the community housing sector was to put it directly in their hands, and to be able to deliver the impact as quickly as we have, I'm not sure that that would've happened any other way, and I think the same is true as you scale this nationally," she added, as an example of some of the insight they've acquired.
The $500M BC Rental Protection Fund was announced in January 2023, launched operations in July 2023, and began announcing acquisitions this February — just about a year after the Fund was announced.
Calls are coming from other provinces.
"We hear from other provinces fairly often, although I would definitely say there's been a significant uptick in the last two weeks. In fact, I've got a call later this week with one of them and then another province is working on trying to figure out if they can come here and join us in the office for a day or two and really get a deep understanding of how it works."
Regardless of the $5M initial grant total, the Government of Canada has voiced a strong belief in the concept. In an interview with STOREYS prior to Budget Day, Minister of Housing, Infrastructure, and Communities Sean Fraser said that, "We, over the course of the last number of decades, have lost hundreds of thousands of affordable housing units in this country, as older buildings become renovated, or the price go[es] up when a new owner takes over a building, and if we [provide] an opportunity for non-profits to maintain quality accommodations at prices for low-income families, then we can solve a very, very big social problem."
Upon inquiry, Infrastructure Canada told STOREYS that the limited funding allocated for the first year "reflects the time required to design and launch the Fund and to solicit, review and approve applications before funding for individual projects begins to flow."
It also remains unclear when the Canada Rental Protection Fund will be launching and what exactly it will look like.
"We hope it is able to start flowing as soon as possible and we are ready to engage and have a conversation about what it can look like and what it ought to look like in order to have the greatest impact, but the reality is that these units will never really be more affordable than they are now," says Maslechko. "We continue to lose them with every day, week, and month that passes, so time is of the essence."
Editor's Note: This article was updated on May 1 after receiving a statement from Infrastructure Canada.
