Canada Mortgage and Housing Corporation

Based on Wikipedia: Canada Mortgage and Housing Corporation

In 1947, a curious thing happened in Ajax, Ontario. The Canada Mortgage and Housing Corporation—a government agency barely a year old—took over an abandoned munitions factory and transformed it into something the world had never quite seen: a fully planned, self-sustaining industrial community built from scratch. Former bomb-making facilities became the bones of a new town, complete with housing subdivisions, commercial centers, and industrial parks. It was audacious. It was unprecedented. And it worked.

This story captures something essential about the CMHC, Canada's federal crown corporation responsible for housing. It's an organization born from crisis, shaped by war, and perpetually reinventing itself to meet the housing challenges of each new era.

Born from War, Built for Peace

The CMHC exists because of World War II. Not indirectly, not metaphorically—literally.

In 1941, as Canada mobilized for war, the government created something called Wartime Housing Limited. This crown corporation had a singular mission: build and manage rental housing for the flood of workers streaming into factories and the soldiers who would eventually return home. By war's end, Wartime Housing Limited controlled thirty thousand homes, called "wartimes" by the people who lived in them.

But the government saw a problem looming. When the war ended, millions of soldiers would return to cities already bursting at the seams. War brides would arrive from overseas. Young couples, their lives on hold for years, would rush to start families. Meanwhile, construction materials remained scarce, skilled workers were in short supply, and housing that had barely sufficed during wartime would face impossible pressure.

Canada needed a coordinated federal response. In December 1945, Parliament created the Central Mortgage and Housing Corporation—the "Central" would later become "Canada"—consolidating nearly all federal housing programs into a single agency. It officially began operations on January 1, 1946.

The founding mission was straightforward: find and create housing for returning veterans and their families. The organization received twenty-five million dollars in capital—equivalent to roughly four hundred and eighteen million dollars today—and authority to accumulate a five-million-dollar reserve fund from its profits.

What Does a Housing Corporation Actually Do?

To understand the CMHC, you need to understand three distinct functions that rarely get bundled together in other countries.

First, the CMHC provides mortgage liquidity. This is financial jargon for a simple concept: the corporation helps ensure that banks have enough money available to lend to home buyers. Without this, even creditworthy Canadians might find themselves unable to get mortgages simply because banks ran short on funds to lend.

Second, it acts as a mortgage insurer. This is where things get interesting. When you buy a house in Canada with less than a twenty percent down payment, your mortgage is considered "high-leverage"—you're borrowing a lot relative to the home's value. Banks consider these loans riskier. The CMHC steps in and insures these mortgages, meaning if you default, the bank doesn't lose money; the government reimburses them. In exchange, borrowers pay insurance premiums.

This system fundamentally changed who could own homes in Canada. Before mortgage insurance, you needed substantial savings for a down payment. After 1954, when the CMHC introduced mortgage insurance with just a twenty-five percent down payment requirement, banks could lend more confidently. By 1999, that requirement had dropped to just five percent.

Third, the CMHC develops and finances affordable housing. This ranges from direct construction—the organization built subsidized housing developments starting in 1946—to partnering with non-profits, provinces, and municipalities on housing projects.

Today, the CMHC is the largest crown corporation in Canada by assets. As of 2021, it held two hundred and ninety-five billion dollars in assets. That's roughly comparable to the gross domestic product of Finland.

The Architecture of Public Housing

The 1950s brought a shift in thinking. Having housing was no longer enough. Housing needed to be good.

The federal government began offering grants to cities with an unusual purpose: tearing things down. The idea was "urban renewal"—demolish derelict buildings, clear slums, and replace them with municipally owned housing. Regent Park in Toronto became the template. Forty-two acres cleared. Over a thousand low-rent units built. A fresh start, or so the thinking went.

This approach—clear everything, build anew—spread across Canada. Montreal's Habitations Jeanne-Mance followed the same model. These weren't just housing projects; they were attempts to re-engineer urban life itself.

Not everyone benefited equally from urban renewal.

In Vancouver, the CMHC's "community urban renewal" programs targeted Hogan's Alley, the city's only Black neighborhood. The plan called for an overpass that would require demolishing the community. By 1970, Hogan's Alley was gone—razed, its residents displaced. In a cruel irony, the highway that justified the destruction was never built. Protests from neighboring communities stopped it. But the Black community was already scattered.

This dark chapter illustrates something important about large-scale housing policy: it concentrates enormous power to reshape communities, and that power can destroy as easily as it can build.

From Quantity to Quality to Affordability

Each decade brought new priorities.

The 1960s saw Canada's cities exploding outward and upward. For the first time in Canadian history, apartment buildings were being constructed faster than single-family homes. The CMHC pivoted toward municipal planning, funding programs to help cities manage rapid urban growth.

This era also produced some of the CMHC's most ambitious experiments. In 1967, the corporation funded Habitat 67, a wildly innovative housing complex designed by architect Moshe Safdie for Montreal's world fair. Habitat looked like someone had stacked concrete boxes at impossible angles—which, in a sense, is exactly what it was. Each unit was a prefabricated module, and the design demonstrated that high-density housing didn't have to mean anonymous towers. The project advanced materials science and construction techniques, even if the cost of replicating it proved prohibitive.

That same year, the CMHC exported its expertise abroad for the first time, building wood-frame homes in Harlow, England. A Canadian government housing corporation building houses in Britain—it was a sign of how much knowledge Canada had accumulated in the postwar housing boom.

The 1970s brought affordability to the foreground. Home prices were rising faster than incomes, squeezing first-time buyers and lower-income Canadians. The CMHC responded by encouraging smaller lot sizes and higher-density developments—more homes on less land meant lower per-unit costs.

But the more interesting innovation was the Assisted Home Ownership Program, introduced in 1971. This program specifically targeted first-time buyers and lower-income Canadians who wanted to own rather than rent. It was an explicit acknowledgment that homeownership had become central to Canadian middle-class identity, and that government policy should help more people achieve it.

The Indigenous Housing Gap

Also in 1971, the CMHC turned attention to a population whose housing needs had long been neglected: Indigenous peoples.

The Winter Warmth Assistance Program became the first federal initiative specifically providing funds for urgent housing repairs in rural Indigenous communities. It was, frankly, embarrassingly late. Indigenous Canadians had endured housing conditions far below national standards for generations.

Over the following decades, the CMHC developed additional programs. On-reserve loan insurance products enabled Band Councils and Indigenous individuals to access insured financing for construction, purchase, or renovation of homes. Pilot programs aimed to increase market housing on reserves.

Yet the gap persists. Indigenous housing remains one of Canada's most stubborn policy challenges—a reminder that creating a program is not the same as solving a problem.

The Withdrawal and the Shift

The 1980s marked a fundamental change in philosophy.

The federal government withdrew from directly financing public housing projects. The CMHC stopped directing funds to municipalities for building housing. Some government money and mortgage guarantees continued flowing to individual projects, but the era of large-scale federally funded public housing construction was over.

Why the retreat? The reasons were partly ideological—a broader shift toward market-based solutions across Western governments during the Reagan-Thatcher era. They were partly fiscal—public housing proved expensive to build and maintain. And they were partly practical—some public housing projects had developed serious problems with crime, maintenance, and community dysfunction.

The CMHC pivoted toward what might be called "enabling" rather than "providing." Mortgage-backed securities, introduced in 1986, let investors buy into pools of residential mortgages rather than individual loans. Canada Mortgage Bonds, launched in 2001, ensured a steady supply of low-cost mortgage funding. These financial innovations kept mortgage interest rates lower than they might otherwise have been, indirectly supporting home ownership without requiring the government to build a single unit.

The Innovation Engine

Throughout its history, the CMHC has served as a kind of research and development laboratory for housing.

Consider the Canadian Home Insulation Program, which ran from 1977 to 1988. At a time when most governments barely thought about energy efficiency, the CMHC was encouraging homeowners to retrofit their houses for better insulation. This wasn't just about comfort—it was about reducing energy dependence during the oil shocks of the 1970s.

The 1990s brought "FlexHousing," homes designed to adapt to occupants' changing needs over time. A young family's playroom could become an elderly resident's accessible bedroom. The concept anticipated demographic shifts and the desire to age in place rather than moving to assisted living facilities.

"Healthy Housing" pushed energy efficiency and resource conservation further. "Barrier-free housing" addressed accessibility for people with disabilities—a concern that housing design had historically ignored.

In 1996, the CMHC introduced "emili"—yes, lowercase—an automated underwriting system that dramatically reduced mortgage insurance application approval times. This was cutting-edge technology for its era, applying what we'd now call artificial intelligence to process applications faster and more consistently than human underwriters could manage.

Housing and the Cooperative Alternative

In 1966, the CMHC built something different in Winnipeg's Willow Park neighborhood: Canada's first cooperative housing project.

Cooperative housing occupies an interesting middle ground between renting and owning. Residents don't own their individual units outright, but they collectively own the entire building or development. They elect boards, make decisions democratically, and share responsibility for maintenance and governance.

Why does this matter? Cooperative housing removes the profit motive that drives up rents in conventional rental housing. It gives residents more control and stability than traditional renting while requiring less capital than homeownership. And it builds community in ways that atomized ownership or anonymous renting rarely achieve.

The CMHC's support for cooperative housing reflects a broader philosophy: that housing solutions need not be binary choices between private ownership and public provision. Mixed models can capture benefits of both.

The Twenty-First Century Challenge

As Canada entered the new millennium, housing affordability became an acute crisis in the country's major cities. Toronto, Vancouver, and other metropolitan areas saw home prices far outpace income growth. Young Canadians who would have comfortably bought homes a generation earlier found themselves locked out of ownership entirely.

Homelessness, once considered a marginal issue, demanded attention. Indigenous housing gaps persisted. Seniors needed assisted living options. Victims of domestic violence needed shelter.

The 2016 federal budget reflected this expanded understanding of housing needs. The government announced 1.4 billion dollars over two years for affordable housing initiatives. This included more than five hundred million dollars for new construction, renovation, and rent supplements—measures expected to benefit over one hundred thousand households. Two hundred million went specifically to seniors' housing. Ninety million funded shelters for domestic violence victims. Over five hundred million addressed repairs and efficiency improvements to existing social housing.

These numbers sound large, and they are. Yet they represent a fraction of what would be needed to address Canada's housing affordability crisis comprehensively. The CMHC today operates in a gap between its expanded mandate and constrained resources—expected to improve housing conditions for Canadians while working within budgets that cannot possibly meet every need.

How It All Connects

The Canada Mortgage and Housing Corporation matters because housing matters.

Housing is not just shelter. It's wealth accumulation for those who own. It's stability for families raising children. It's community for those who find neighbors and friends. It's safety for those fleeing violence. It's dignity for those who might otherwise be homeless.

The CMHC's evolution over nearly eighty years mirrors Canada's own evolution. A country emerging from war needed to house its veterans. A country urbanizing rapidly needed to manage growth. A country becoming more conscious of inequality needed to address affordability. A country reckoning with historical injustices needed to confront Indigenous housing gaps.

Not every initiative succeeded. Urban renewal destroyed communities. Withdrawal from public housing left gaps that private markets did not fill. Indigenous housing remains inadequate. Affordability in major cities has reached crisis levels that existing programs cannot solve.

Yet the CMHC represents something important: the idea that housing is not purely a private matter to be left to markets alone. It's a collective challenge requiring collective tools. Whether those tools are deployed wisely, adequately, and equitably remains an ongoing struggle—one that each generation of Canadians inherits from the last.

The munitions factory in Ajax became a town. The wartimes became homes. The question now is what the CMHC will build next.