Without even as much as a mention in the most recent budget, B.C. is suspending the multi-billion-dollar Community Housing Fund that was a key part of its strategy to crawl out of the housing crisis.
The sudden decision has left many local governments and those in the non-profit housing sector exasperated and confused.
And project proponents could be on the hook for massive amounts in sunk costs.
The $3.3 billion fund was introduced in 2018 to help pay for more than 20,000 affordable rental units. It has become something local governments rely on to meet provincial housing targets, which were introduced in 2023 to ensure municipalities are working to tackle the housing crisis. The program has paid for 13,600 homes so far.
The fund’s latest intake opening, announced last May, opened up $775 million for project proposals.
Budget 2026, released on Tuesday, Feb. 17, retracts this money, leaving those who applied scrambling for answers.
The housing ministry says the program is not being “cancelled,” though it has decided not to proceed with any of the new applications and has announced no plans to accept more.
Suspension makes it harder to build housing that is actually affordable
Squamish Coun. Jenna Stoner said the town’s local housing non-profit applied last July for $17.8 million to fund a 100-unit affordable housing project in the Northyards district.
Squamish, unlike some other parts of B.C., is still struggling to house people, with vacancy rates that recently dropped to 0.2 per cent.
This project would have helped the town meet provincial housing targets, she said.
“It had been in the works for years,” Stoner said. “We put over $500,000 into pre-development government work, simply to get an application in.”
She said they heard “nothing but crickets” until yesterday’s budget was announced. She had expected a “reliable partner” in the province to address the housing crisis, but said this decision takes the “opposite direction.”
“I’m particularly frustrated in the way that this has been communicated and handled,” she said.
Stoner and others say that even if the projects eventually move ahead, without the fund, they will not be as affordable.
“Some projects will go ahead, many, many won’t,” said Jill Atkey, CEO of the B.C. Non-Profit Housing Association. “It will not be affordable housing as we know it.”
Sunk costs are also a major concern for Atkey. Proponents have secured land, paid for architectural drawings, and taken other preliminary steps.
She highlighted projects that include a 139-unit development in Colwood, the 40-unit Sutcliffe redevelopment in Saanich and the 210-unit Lime Bay/Roundhouse project in Victoria.
Atkey reckons that overall about 100 proposals will be impacted.
“That’s 15 million dollars spent by the non-profit housing sector in good faith,” she said.
Atkey says the ripple effects of this decision will be felt for years, by both the sector trying to finance these projects and the people seeking an affordable place to live.
Housing targets to remain
Housing Minister Christine Boyle, at an announcement on Wednesday about a separate $170 million federal funding boost for B.C. housing projects through Build Canada Homes, said she understood the “frustration” of applicants.
“I understand that’s frustrating, and we’ll keep working with project proponents and applicants to see what different paths forward exist,” she said, adding that this might mean it takes a “bit longer” as the province works to contain the budget deficit.
But the housing targets are not going away.
“The housing targets remain in place,” she said.
New Westminster Mayor Patrick Johnstone, who was in the room for Boyle’s comments and had a meeting scheduled with her later in the day, said that meeting the targets requires provincial support.
“We need the government to do the opposite — go the opposite direction and actually increase spending on affordable housing,” he said.
This is particularly true for the most affordable types of units, he said. This is where the most need is.
“Our housing needs assessment shows that we need hundreds and hundreds of supportive housing units in the city,” Johnstone said. “We’ve got people sleeping in the street in New Westminster.”
For the most part, Johnstone and others are still trying to figure out what the change will mean — hence the meeting with Boyle.
Boyle said she couldn’t consult municipalities and non-profits beforehand because this was a budgetary decision, and it is customary to hold that information back until the budget is unveiled.
But the Union of B.C. Municipalities President Cori Ramsay says that the budget does not even include a line item explaining the change. She only found out about the change after inquiring about what it meant when the government said it was “reallocating” $1.4 billion that was supposed to be spent on housing projects.
“The budget was not very transparent about the indefinite closure of the housing fund,” she said.
Like others, Ramsay says this will jeopardize municipalities’ ability to meet housing targets. She wants the province to adjust accordingly.
“If the province is giving itself flexibility in its goals, local government is expecting that same flexibility,” she said.