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What is Social Housing?

Quick answer: A social housing unit is any home that receives funding or subsidy from the government in order to allow it to be rented at below the market rate for its value. Social Housing in Canada can either be 1) Public Housing, where units are owned and operated by governments, or 2) Non-Profit, Co-op, and Urban Native housing. From 1973-1993 the federal government, through the CMHC, entered agreements with Provincial/Territorial and Municipal governments (1), as well as independent housing providers (2), to purchase or construct social housing, with mortgage payments and operating costs subsidized by the federal government.

The basic structure of Canada’s housing economy is that of the market, where housing units are constructed, sold, and rented without government regulation of prices.  This leads to adequate housing outcomes for many people in Canada, but for a significant segment of the population, support is needed to ensure they are adequately housed.  Since the 1930s the Canadian government has engaged in many forms of intervention to enable access to affordable housing for those who cannot afford it on the open market:

Public Housing20

Before 1949: Social housing before 1949 generally consisted of large one-off projects purchased or constructed by federal or provincial governments, often to help people in wartime or returning veterans.

1949-1964: The federal and provincial governments jointly purchase or construct public housing, usually designed by the federal government and administrated by the provinces.

1964-1983: The federal government develops a program in which the CMHC makes a loan to the provinces or territories to purchase or build public housing.  The loan would be repaid over 50 years, and during this time the CMHC would cover 50% of the operating losses associated with operating the projects at rent-geared-to-income (RGI), where tenants pay rent as a fixed proportion of their income, often 20-30%.

1983-present: In 1983 the federal government discontinued public housing programs.

Non-Public Social Housing20

In 1973, the federal government amended the national housing act to allow the CMHC to make loans to Non-Profit and Co-op housing providers, covering up to 100% of the start-up costs.  Like the Public Housing agreements, these loans would be repaid over 50 years, with operating costs subsidized by the CMHC during that time.  The major difference was that these operations were non-governmental, and often mixed-income, where some, but not all rental units were rented at subsidized rates.  In 1986 the program was amended such that loans and subsidies for Non-Profit housing would be over 35 years, rather than 50.

Non-Public Social Housing also includes housing specifically geared towards Aboriginal groups, including both on and off reserve housing initiatives.  The Urban Native Housing Program was begun in 1982 and incorporated into the Non-Profit housing program in 1986.  It consisted of aboriginal community groups entering into similar agreements with the CMHC as non-Aboriginal Non-Profit housing providers.

All programs for Co-op and Non-Profit housing agreements ended in 1993, and programs for Public Housing development ended in 1983, meaning that contracts signed between 1973-1993 will continue for their 35-50 year term, but no new contracts were signed after that. 

What Does the End of Federal Subsidy Agreements Mean for Social Housing?

Quick Answer: Because the situation of each public and non-profit housing provider is different with respect to its size and mix of rent supplement, RGI, and market rental units, the end of subsidies will affect each one differently.  There is currently no central information about the post End-of-Agreement (EoA) viability of social housing providers, but recent research has suggested that as many as 25-50% of social housing providers are at risk of being unable to maintain their current level of social housing.  Focusing on higher risk projects such as Urban Aboriginal projects, this number is as high as 80%.  This would mean more people at risk of being vulnerably housed or homeless.


                Nearly all of the federal agreements made between the CMHC and Public, Non-Profit, Co-op, and Urban Native housing providers were signed between 1964 and 1993 for a period of either 35 or 50 years.  That means that the period of 2008-2034 will gradually bring the end of subsidies to the existing social housing stock.  This phenomenon can be visualized below.

               EoA will mean different things to different housing providers, given that each one will have a different number of units, serve different populations, have different operating expenses, and have a different mix of social and market units.  One aspect of EoA that will help providers remain viable is that they will have paid off their mortgages.  However, operating social housing without subsidy still often means operating at a loss, and since many of the buildings are 25-50 years old or older, necessary new capital expenses may be out of reach for providers21.As can be seen, we are currently entering into the time period of the peak rate of agreement expiry, with around 150,000 agreements expiring between 2014-2020. 

In private correspondence with the Canadian Housing and Renewal Association, they suggested that “operating costs will not, in fact, be the most significant issue for social housing providers, particularly over the medium to long term (although in the case of some, the short term).  Rather, capital needs will be the biggest issue. That said, we have estimated about 1/3 of the social housing stock (200,000 units) will need some operating support after agreements end.”

                If housing providers can no longer support their social housing units without federal subsidy, there is a risk that to make ends meet they will need to either raise rents, therefore putting the units out of reach of those who need them, or sell off some units into the private market so that they have the capital to maintain a smaller number of social units.

What We Recommend

                While some organizations have suggested that the federal government simply renew its agreements with housing providers, we feel that this is too much of a one-size-fits-all tool, given the diversity of projects and their financial situations.  We instead recommend that in each budgetary year, beginning with 2014, the federal government reinvest the savings gained from the end of subsidies into programs that will enable social housing providers to continue to provide housing to those in need at below-market rent.  Since the agreements are currently administered by provinces and territories, the federal government should work with these bodies to develop a system to evaluate the need of social housing providers with regard to capital and operating costs. Federal funding will then be used towards programs that will allow social housing to remain social, either through the existing funding stream of Investment in Affordable Housing, or through a new funding stream specifically for social housing built under federal agreements.  If there is money remaining after the needs of existing social housing have been met, this money should be put into streams to support expanding affordable housing.