Ottawa to provide nearly $1 billion to Quebec to assist with housing construction

A worker at a residential construction site in Salaberry-de-Valleyfield, Montérégie, on Wednesday, October 22, 2025. THE CANADIAN PRESS/Christinne Muschi

After many months of discussions, Quebec will finally receive its share of federal funding aimed at accelerating housing construction. Ottawa will provide nearly $1 billion.

The Quebec government and municipalities will be able to use these funds to modernize and develop the infrastructure needed to carry out new housing projects, such as drinking water, wastewater, and stormwater systems.

This money comes from the Canada Housing Infrastructure Fund (CHIF), established in 2024 during the Trudeau government. This program promises $6 billion over ten years.

Negotiations between Ottawa and Quebec over the CHIF lasted more than a year. The two levels of government finally announced on Wednesday that they had reached an agreement.

“The agreement announced today is a major step forward in housing. It is important and fully respects Quebec’s jurisdiction, priorities, and legislative framework,” said Caroline Proulx, Minister responsible for Housing, in a news release.

“By working closely with the Quebec government, we are putting in place the conditions necessary to accelerate housing construction, reduce barriers, and offer real solutions to communities,” said Federal Minister of Housing and Infrastructure Gregor Robertson.

The Quebec government will be able to use the money according to its priorities and the needs of the territory.

In addition to supporting water projects, FCIL funds can also be used to implement waste diversion measures to reduce the use of landfills.

This money was eagerly awaited by Quebec cities. According to Minister of Municipal Affairs Geneviève Guilbault, “dozens of municipalities will be able to carry out long-awaited work and provide reliable services throughout Quebec” thanks to this agreement.

The lack of agreement between the two governments has slowed down essential infrastructure investments, according to the Union of Quebec Municipalities (UMQ).

“In recent years, a growing number of municipalities have had to halt or slow down residential development due to limitations related to the capacity of their water infrastructure,” commented UMQ President Guillaume Tremblay, who is also the mayor of Mascouche.

He is calling for “FCIL funds to be made available quickly to enable major investments that will make it possible to build new housing.”

The UMQ points out that, according to its study published last May, “more than 36,000 homes could not be built due to a lack of water infrastructure capacity.”

Only 2 per cent of needs covered

The Quebec Association of Construction and Housing Professionals (APCHQ) also welcomed the announcement, noting that “Quebec was until now the only province without an agreement to access” the federal fund.

However, due to the length of the discussions, the real value of the agreement has had time to depreciate, according to the APCHQ, since “construction costs have skyrocketed under the effects of inflation and market volatility.”

“This amount covers only 2 per cent of the needs, since the municipal housing infrastructure deficit is estimated at nearly $49 billion in Quebec,” the APCHQ said in a press release.

According to the UMQ, the envelope of nearly $1 billion is not proportional to Quebec’s population in Canada. In this context, it estimates that the share allocated to Quebec municipalities should have been $1.3 billion.

In addition to funding under the FCIL, another agreement has been signed between the Quebec government and Canada Housing and Communities Canada for investments in affordable housing projects in Quebec.

Quebec and Ottawa plan to work together through a “joint collaboration table” to fund affordable housing projects “aligned with shared priorities.”

They also commit to working together to “simplify and accelerate authorization processes and ensure better coordination between government, municipal, and community partners.”

By Frédéric Lacroix-Couture

This report by The Canadian Press was first published in French on Jan. 21, 2026.