Canada’s housing crisis extends beyond affordability—it is a supply issue that directly impacts economic productivity and competitiveness. Rising construction costs, outdated regulations, and inflexible financing structures have slowed housing starts. However, a shift toward industrialized construction and strategic collaboration presents a significant opportunity to transform Canada’s housing supply and drive economic growth.
The Role of Innovation in Housing
Embracing technological advancements in construction is crucial for effectively addressing the housing crisis. Industrialized methods such as factory-built modules, modular construction, and robotics offer promising solutions to enhance efficiency, reduce costs, and ensure consistent quality in housing projects at scale.
- Assembly is mobilizing its manufacturing facility in preparation for the opening of a state-of-the-art factory in early 2026. This initiative aims to streamline the construction process and significantly reduce timelines by incorporating advanced automation and prefabrication techniques.
- Horizon Legacy is revolutionizing the industry by implementing onsite robotics to construct Canada’s first and largest neighborhood using such technology. This project includes 26 rental units, each built for under $300,000, achieving a 67% reduction in greenhouse gas emissions over their lifetime. The robotic construction methods employed meet Ontario Building Code requirements, setting new standards for the industry.
By adopting and expanding these technological advancements, Canada can more effectively address its housing challenges, leading to increased efficiency, reduced costs, and improved quality in housing projects nationwide.
Collaborative Efforts in Housing Development
At the Housing Symposium: Unlocking Solutions to a Generational Crisis on March 13, 2025, federal Housing Minister Nate Erskine-Smith emphasized the importance of aligning policy, funding, and industry to increase housing supply. One example of this coordination is the $2.55 billion federal investment in rental housing through the Apartment Construction Loan Program (ACLP), which will support over 4,800 new rental units, including 1,000 affordable homes. The City of Toronto’s $234.8 million in financial incentives aims to lower costs and accelerate construction.
The University of Toronto Mississauga (UTM) is advancing a model that aligns directly with Canada’s broader housing goals: delivering more supply through sustainable, purpose-built construction. Its new student residence, set to open in 2026, is part of a tri-campus initiative that will add 1,446 new student housing spaces over the next three years.
But while this kind of public investment is essential, it’s only one part of the solution. Bottlenecks like outdated approval systems, rigid financing structures, and high municipal costs—continue to limit how quickly and affordably housing can be delivered.
Addressing Systemic Barriers
At the Housing Symposium, John DiMichele, CEO, Toronto Regional Real Estate Board said, “The thing that bothers me the most is that it takes forever to get that first shovel in the ground and then between then and actually giving someone the keys, 36% of that money goes back to the government. Get out of the way!”
Key barriers in cost, permitting, and financing limit the ability to build faster and more affordably:
- Municipal development charges make up nearly 30% of project costs, increasing prices for developers and homebuyers.
- Cumbersome regulatory and permitting processes slow down housing delivery.
- Financing models must evolve to support new construction approaches.
Without addressing these systemic barriers, even well-funded projects risk being delayed, downsized, or made financially unviable. The solution is to embrace innovation, which was one of the key takeaways from the Housing Symposium.
Embracing Innovation
Canada can deliver more housing, reduce costs, and strengthen economic productivity by embracing industrialized construction, developing a more adaptive approval system to enable scalable modular and prefabricated solutions, and supporting innovative financing models that foster industrialized housing and purpose-built rentals.
Innovation is already happening—but scaling it requires collaboration across industries, investment in new technologies and business models, and policies that enable rather than delay housing solutions. R-LABS is a partnership of corporations and game-changing entrepreneurs delivering industry innovation. We are on a mission to co-found great companies that solve major problems in real estate and housing. If you want to get involved, learn more at www.rlabs.ca.
