Canada Mortgage and Housing Corporation (CMHC) has launched the Frequent Builder framework to accelerate the construction of affordable homes and rental homes in Canada. The new framework promises to expedite the application process for established housing providers that are seeking to secure funding through the Affordable Housing Fund (AHF) and the Apartment Construction Loan Program (ACLP) and meet the additional eligibility requirements.

“We are facing a shortage of affordable housing in Canada, so if you’re a housing provider, we want you to build,” said Sean Fraser, Minister of Housing, Infrastructure and Communities. “The Frequent Builder framework will allow experienced housing providers to access construction financing through the National Housing Strategy faster and get more projects off the shelf and shovels in the ground.”

Fast-tracking approvals

As the demand for affordable housing continues to rise and vacancy rates plummet to critical lows, CMHC acknowledges that one of the biggest challenges facing housing developers is the notoriously slow planning and approval stage. The housing industry has often cited government red tape and dismally long approval processes for adding months, if not years, to any new building project. As Richard Lyall, president of RESCON, said at the 2024 CFAA Rental Conference in May: “This isn’t a housing crisis, it’s a growth management crisis. Although there have been some positive changes introduced recently by all levels of government, it’s not enough.”

Though it won’t solve the housing crisis on its own, the Frequent Builder framework is another step in the right direction, offering those with status key benefits such as a streamlined approval process with underwriting and advancing flexibilities, and the opportunity to secure funding commitments for future housing projects.

“We are excited to launch the Frequent Builder framework as it will better support housing providers in building the housing we need and do it more quickly,” said Coleen Volk, President and CEO of CMHC. “This new framework will also support CMHC’s new service standard of Affordable Housing Fund and Apartment Construction Loan Program applications receiving conditional approval within 30 days and full approval within 60 days.”

The Affordable Housing Fund and Apartment Construction Loan Program are both part of the Government of Canada’s National Housing Strategy (NHS), an $82+ billion plan to give more Canadians a place to call home. While the AHF provides funding through low-interest and forgivable loans or contributions to partnered organizations for new affordable housing and the renovation and repair of existing, affordable and community housing, the ACLP provides fully repayable, low-interest loans to encourage the construction of rental homes for middle class Canadians.

Eligibility requirements

To be eligible, CMHC will assess applicants on their financial strength demonstrated through satisfactory credit assessment by CMHC. For-Profit entities must have conducted a minimum of $50 million in business with CMHC and fulfill three of the following requirements:

• own more than $1 billion of multi-residential assets
• have a minimum net worth value of $250 million
• have a 1.30 debt coverage ratio within their multi-residential portfolio
• have more than $500 million of effective outstanding exposure (insurance and lending) with CMHC

Provinces, territories, municipalities, Indigenous governing bodies and other levels of government require a minimum level of business of $20 million with CMHC.

For non-profit organizations and co-operative housing corporations, CMHC will also consider clients who have $20 million of business with CMHC and manage a large portfolio of rental housing units (typically 500 or more units).

Find out more by visiting: Affordable Housing Fund | CMHC (cmhc-schl.gc.ca)