Canada's budget to boost homelessness funding, with a nudge toward supportive housing

What the budget will do

Ottawa's next spending plan will add funding to tackle homelessness, with a portion intended for supportive housing, according to people familiar with the budget. The government also aims to get provinces to chip in on supportive housing.

Supportive housing links an affordable apartment with wraparound help, including mental-health care and case management. Prime Minister Mark Carney's government says affordability and growth will anchor Thursday's plan, and people briefed on the budget say homelessness will be a focus. "If you look at the what I call the pyramid of affordability, it starts with a place that you can afford to live, a safe place," Finance Minister Francois-Philippe Champagne said Monday.

Why the push now

Since Covid-19, homelessness has increased, straining municipal and health budgets and heightening worries about safety and substance use in big cities. That pressure has spilled into politics, with debates over encampments and safer supply strategies gaining traction.

A federal report estimates the number of people without housing on any given night rose 59% from 2020 to 2025, and a growing proportion are spending the night outdoors, including in encampments. In Ontario, the province's Financial Accountability Office found that over 35,000 individuals were in chronic homelessness in 2024-25, a 37% increase from 2022-23.

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Politics and programs to watch

Ontario's 29 largest-city mayors asked the province in January to declare a state of emergency, calling homelessness a community safety and humanitarian crisis. In Quebec, newly elected Premier Paul St-Pierre Plamondon has promised a provincial summit on the issue.

Those trends diverge from a pledge made under former Prime Minister Justin Trudeau to cut chronic homelessness by 50% by 2028 relative to 2016. They have also unfolded alongside worsening housing affordability in 2022 and 2023.

What it means for your portfolio

Reaching Home, the federal strategy to reduce and prevent homelessness, is slated to see its funding end when the National Housing Strategy sunsets in 2028. Housing Minister Gregor Robertson says a new strategy is in the works, but has not given a timeline.

Separately, the Carney government has pledged to grow Canada's supply of non-market housing via Build Canada Homes, a Crown corporation launched in 2025 with C$13 billion in initial capital, including C$1 billion for supportive housing. If Thursday's budget follows through and provinces add their own dollars, watch the pipeline for supportive and non-market projects that could shape construction volumes, municipal finances, and demand for related services.

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