Ten-point agenda urge to cut delivery costs and revive middle-class housing
Canada’s housing crisis has been framed too narrowly as a demand problem, according to economist Mike Moffatt, who argued that 2026 needs to be the year governments tackle the basic cost of building homes for the middle class.
In a new “Housing Policy Wish List” from the University of Ottawa’s Missing Middle Initiative, Moffatt described Canada’s woes as “a cost-of-delivery crisis” in which “it is simply too expensive, by policy design, to build homes that middle-class families can afford, even before land and profit are considered.”
He said governments across the country have been “taxing new homes like cigarettes,” with development charges, sales taxes and land-transfer taxes stacking up on new housing “in ways that punish first-time buyers and renters, inflate construction loans, and slow the very supply we need.”
Development charges under fresh scrutiny
New Canada Mortgage and Housing Corporation (CMHC) data showed the scale of the problem, with development charges on a two‑bedroom apartment ranging from about $39,600 per unit in Ottawa to $121,500 in Markham – more than a threefold gap that could add 8–16% to new condo prices in some markets.
“Although the benefits of immigration to our labour market, our economy, and our social fabric are widely distributed, the up-front infrastructure costs are not widely shared, but rather placed on a small subset of new homebuyers and renters, including the newcomers themselves,” Moffatt said.
He urged financing infrastructure “at government bond rates, rather than residential mortgage and construction loan rates,” and shifting to revenue-backed models such as water bill surcharges to cut interest costs now embedded in housing.
Moffatt warned that the “growth should pay for growth” mantra has become “a linguistically vague rhetorical shield” that allowed population-related costs to be “disproportionately placed on the young.”
Family-sized homes and ‘missing middle’
Canadian housing policy has also “ignored families,” he said, by treating “a unit is a unit is a unit,” with studio condos effectively rewarded the same as three-bedroom homes.
Zoning, building codes and fee structures have, in his view, “legislated 3‑bedroom ‘starter’ family home…out of existence due to bad policy design.”
Moffatt called for reforms to building codes, zoning, and condo financing, along with reintroducing a modernized MURB tax provision to spur small- and mid‑rise rental construction.
Vision, metrics and the mortgage market
Moffatt has previously criticised flagship programs such as Build Canada Homes. He said it would make only a “modest contribution” to affordability for middle-income households without clearer goals and scale.
“Our governments lack well-defined housing goals and objectives,” Moffatt said, warning that without explicit targets and performance indicators, “there will be no way to assess whether or not Build Canada Homes was a success or not.”
With housing starts falling and municipal fees and delays rising, other analysts have also warned that local charges and approvals are worsening affordability.
“That is probably too much to wish for,” Moffatt said of a more coherent vision for middle-class homeownership. “But the holidays are where dreams become true.”
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