At Tembo Financial, we understand the challenges Canadians face in today’s housing market. With skyrocketing prices, limited supply, and growing affordability concerns, the federal government’s response to the housing crisis is a topic of critical importance to our clients and readers. Prime Minister Mark Carney has introduced a $25 billion housing program, drawing comparisons to the transformative wartime housing policies of the 1940s. But will Carney’s plan deliver the relief Canadians need and increase actual housing supply on the ground, quickly? Let’s dive into the details of his strategy, compare it to historical precedents, and explore whether it can truly address the housing crisis.

Carney’s Plan: A Wartime Comparison?

Carney’s housing initiative is framed as a modern echo of the policies that resolved Canada’s housing crisis in the 1940s. That era, marked by economic hardship, labour shortages, and rapid urban migration, saw widespread evictions, overcrowding, and rent increases—challenges that feel all too familiar today. The wartime response, led by the Crown corporation Wartime Housing Limited (WHL), was a bold intervention that built tens of thousands of affordable homes, and restored affordability.

Carney’s plan, by contrast, hinges on a new Crown corporation called Build Canada Homes (BCH), which aims to construct affordable housing at scale. The parallels to the 1940s are evident: both initiatives involve public land use, prefabricated construction, and Crown-led efforts to address housing shortages. However, a closer examination reveals fundamental differences that raise questions about whether Carney’s market-driven approach can replicate the success of its wartime predecessor.

The Wartime Housing Model: A Public Success Story

To understand the potential of Carney’s plan, it’s worth revisiting the success of WHL. Established in 1941, WHL was a government-led initiative that directly built, owned, and managed housing. Unlike today’s market-oriented policies, WHL operated outside the speculative market, hiring architects and builders to construct homes, multi-unit residences, schools, community centres, and other public infrastructure. These homes were rented at cost to families, ensuring affordability and shielding them from profiteering landlords and speculators.

From 1941 to 1947, WHL delivered tens of thousands of homes, addressing the housing crisis with remarkable efficiency. By retaining ownership and implementing early forms of rent control, the government ensured that housing remained accessible to working Canadians. The results were undeniable: affordability was restored, and the housing market stabilized. The post-war Advisory Committee on Reconstruction even recommended expanding WHL’s model into a national program for low- and moderate-income housing.

However, in a pivotal shift, the Liberal government of the time dissolved WHL in 1947, folding it into the Canada Mortgage and Housing Corporation (CMHC). The focus pivoted to promoting private homeownership, and WHL’s stock of affordable housing was privatized, sold off to occupants in a move that foreshadowed later market-driven policies. Urban policy advisor Humphrey Carver later criticized this decision as ideological, driven by a reluctance to embrace public housing in favour of private enterprise. This shift set the stage for future housing crises, as the private sector was given free rein to dominate the market.

Carney’s Build Canada Homes: A Market-Based Approach

Fast forward to today, and Carney’s BCH takes a starkly different approach. Unlike WHL, which prioritized public ownership and direct provision, BCH operates through public-private partnerships (P3s). Rather than building or owning homes, BCH will finance and manage projects, with private firms constructing the homes and selling them on the open market.

Will Carney’s Plan Deliver?

Carney’s housing plan, while ambitious, falls short of the transformative vision that resolved the housing crisis of the 1940s. By relying on market forces and private partnerships, BCH risks repeating the mistakes of past policies that prioritized corporate interests over affordability. Without strong safeguards—such as affordability covenants, public ownership, or robust rent control—the homes built under BCH could easily become another asset for speculators, leaving ordinary Canadians no closer to homeownership or stable housing.

At Tembo Financial, we believe that educating our clients about the housing market is key to empowering them to make informed decisions. While Carney’s plan may generate new housing stock, its market-based approach will have to be well executed to increase affordability and accessibility that Canadians need.

What Does This Mean for Tembo Clients?

For those navigating the housing market, whether as first-time buyers, investors, or homeowners seeking private mortgage solutions, understanding the broader policy landscape is crucial. Carney’s plan may increase housing supply, but without affordability guarantees, it’s unlikely to ease the financial pressures many face.  At Tembo Financial, we’re committed to helping our clients achieve their homeownership goals, even in a challenging market. Our flexible private mortgage solutions can provide the support you need, whether you’re purchasing a home, refinancing, or exploring investment opportunities.