What the Spring Economic Update Signals for Canadian Housing

By Howard Paskowitz, Senior Vice President, Development and Public Affairs, Starlight Investments

This year’s Spring Economic Update arrived at a time when housing remains one of Canada’s defining public policy challenges. While it was not exclusively about housing, it came amid a broader set of recent federal measures that have helped reinforce the importance of increasing supply and improving the conditions needed to build more homes. The creation of Build Canada Homes, the introduction of the Build Communities Strong Fund, and recent collaboration with the Province of Ontario to support development charge relief all point in the right direction.

That progress is worth recognizing.

For those of us focused on housing delivery, what matters most is whether programs and policies help move projects from concept to construction. In Canada today, the long-term need for rental housing is not in doubt. Our cities are growing, demand is durable, and the need for professionally managed, well-located, purpose-built rental housing is clear. The challenge is whether the right conditions exist to build at the scale the country requires.

From our vantage point at Starlight Investments, that question is central. Starlight is one of Canada’s leading rental housing providers and most active developers of purpose-built rental housing. We manage 55,000 multi-residential suites across Canada, have a development pipeline positioned to deliver thousands more over the next decade, and hold a long-term commitment to both preserving existing rental communities and building new ones. 

That experience shapes how we see the current moment. Canada’s housing challenge is not about identifying demand. It is about restoring the practical conditions that allow more projects to move from approval to construction, and from starts to completion.

From Policy Intent to Project Viability

Across the country, many projects are designed and ready to proceed, but the conditions that determine project viability have become far more challenging.  Construction costs remain elevated. Borrowing costs have shifted the economics of development. Local development charges can be significant. Delays and uncertainty compound those pressures. When that happens, projects that look viable on paper become difficult to advance.

This is why recent federal and intergovernmental action matters. Measures that improve project viability are not peripheral to the housing conversation; they are at its core. If Canada wants to build  more high-quality homes faster, the priority must be turning policy intent into financially workable projects.

The Canada-Ontario Partnership to Build is a good example of the kind of federal-provincial coordination needed to support housing delivery. It reflects a practical understanding that cost pressures at the local level can materially affect whether housing gets built. It also reflects something else that deserves more attention: successful housing policy is rarely about a single lever. It depends on alignment. Federal leadership matters. Provincial frameworks matter. Municipal approvals, servicing, and cost structures matter. Financing conditions matter. Delivery happens when those elements work together.

That is why the most constructive way to read this year’s Spring Economic Update is as part of a broader policy direction that has kept supply, project viability, and implementation firmly in view.

The update included several measures directly relevant to rental housing, including more than $7 billion through the Apartment Construction Loan Program to support up to 16,500 new rental homes, additional support for factory-built and innovative housing, and proposed mortgage insurance reforms to unlock financing for 3- to 8-unit housing, including small-scale rental. 

The broader economic context also matters. The government reported an improved fiscal outlook, with lower projected deficits, stronger growth and revenues, helping reinforce confidence at a time when project economics remain under pressure. The update also noted improving market conditions for rental and real estate since Budget 2025, including slower shelter inflation, moderating rent inflation, and strong rental starts.

Housing Delivery Requires a Predictable Framework

For the private sector, certainty is as important as ambition. Capital can move. The expertise to design, build, finance, and operate housing exists. The appetite to invest in long-term rental communities remains strong. But projects depend on a reasonable level of confidence that the path from approval to completion will remain workable. 

This is not an argument for government to do everything, nor is it an attempt to place responsibility elsewhere. The private sector has a central role to play and must continue to bring discipline, capital, and execution capacity to the table.  But addressing Canada’s housing and jobs challenge will require all levels of government and the private sector to work together. Governments help shape whether the environment supports delivery or slows it down. If the goal is to build more homes, faster, then the policy framework must be designed with real-world feasibility in mind.

That includes aligning federal incentives with municipal cost structures, supporting more predictable and competitive financing, and keeping approvals and regulatory pathways as clear and timely as possible. 

Housing and Infrastructure Go Together

Homes do not exist in isolation; they depend on the infrastructure that allows neighbourhoods to function and expand successfully. Roads, utilities, transit access, public services, and community-serving assets all shape whether growth can happen at scale. 

In that sense, housing is not just a construction issue; it is a nation-building issue.

That is why the Build Communities Strong Fund is an important signal.  New supply depends not only on zoning and financing, but also on whether communities have the capacity to absorb growth. When governments invest in the systems that make growth possible, they help unlock housing.

At Starlight, this connection between housing and infrastructure is something we see clearly in our day-to-day work. Our approach has always been shaped by a long-term view of communities. That includes preserving aging rental stock, investing in building improvements, and adding new supply where it can be delivered efficiently and responsibly. Over the past five years, Starlight has invested $2.3 billion in maintaining, upgrading, and adding square footage to existing properties. Those investments are not only about individual buildings; they are about ensuring communities remain safe, resilient, and capable of serving residents over the long term.

That same perspective informs our development strategy. In markets across Canada, we are focused on creating new purpose-built rental housing while also making better use of land already embedded in established neighbourhoods. Infill development is a particularly important part of that effort, allowing new homes to be added on underutilized land in communities already connected to transit, jobs, retail, and local services.

Projects such as 557 The West Mall in Toronto and The Lively in North Vancouver reflect our infill development approach: adding homes in complete communities where infrastructure already exists and where growth can be integrated thoughtfully. In practical terms, infill can be one of the most effective ways to increase housing supply while strengthening existing communities.

But infill, like any housing strategy, depends on timely approvals, workable costs, and infrastructure systems with enough capacity to support additional residents. The more Canada can align those pieces, the quicker supply can come online. That broader view of community-building is also central to the recent launch of Starlight Infrastructure Solutions, a strategic platform focused on investing in essential-use assets that support public, social and economic systems.  

Across Canada, aging infrastructure and rising demand are putting pressure on systems that support how people live, move, and connect. Private capital cannot replace public leadership, nor should it. But where the policy framework is clear and partnerships are strong, private sector capital and expertise can help strengthen capacity, accelerate delivery, and support more resilient long-term outcomes.

Sustaining Momentum Through Collaboration and Implementation 

The federal government has taken welcome steps to keep housing supply on the agenda and to signal seriousness about delivery. The challenge now is to maintain that momentum through coordinated implementation. For Ottawa, that means continuing to focus on practical tools that improve confidence, reduce friction, and help projects proceed. 

For provinces, the opportunity lies in working with the federal government on frameworks that improve feasibility and support delivery. Canada-Ontario’s direction on development charges is a constructive example and should be rolled out as quickly as possible. It also offers a useful model for other jurisdictions. 

Municipalities, too, are essential partners. Their decisions shape approvals, servicing, timelines, and costs. They are on the front lines of growth, and no serious housing strategy can succeed without them. 

The private sector’s role, in turn, is to keep bringing capital, execution capability, and a long-term commitment to building and maintaining communities. At Starlight, that means growing our development pipeline, preserving and improving existing rental communities, and continuing to invest in projects that add homes efficiently in established neighbourhoods. Those efforts reflect a simple belief: housing supply is not an abstract policy objective. It is about creating places where people can live, thrive, and build their futures.

That is why this moment matters. The Spring Economic Update did not need to be exclusively about housing to help reinforce a constructive direction of progress. It arrived as a useful reminder that economic policy and housing policy are deeply connected. When projects become unviable, Canada does not just lose homes. It loses jobs, productivity, investment, and momentum. 

There is a real opportunity now to build on that momentum. What matters next is whether governments maintain and continue to improve the practical conditions that allow projects to proceed. If they do, more homes will move from approval to construction, communities will gain the infrastructure needed to grow successfully, and more private capital will be able to support the national objectives of increasing housing supply and jobs.

That is worth recognizing, and it is worth building on together.