For the past two years, the Modular Building Institute (MBI) and its members have been working with the Canadian Mortgage Housing Corporation (CMHC) to open up opportunities for modular social housing projects in Canada. The challenge, according to CMHC, is that “modular does not fit our traditional underwriting and financing profile.”
MBI has been able to work with CMHC to develop new underwriting guidelines specific to modular projects. Based on a late-October call with CMHC, those guidelines are expected to be available and in force by the end of 2020.
But the bigger news for the industry is the recent announcement by CMHC about their “Rapid Housing Initiative (RHI).”
The Government of Canada, through CMHC, has launched the RHI as a $1 billion program utilizing only modular construction to help address urgent housing needs of vulnerable Canadians, especially in the context of COVID-19, through the rapid construction of affordable housing. The initiative provides capital contributions (upon signing a funding agreement with CMHC) under two streams to expedite the delivery of affordable housing.
The RHI will:
- Support the creation of up to 3,000 new permanent affordable housing units.
- Cover the construction of modular housing, as well as the acquisition of land, and the conversion/rehabilitation of existing buildings to affordable housing.
- Aim to commit all funds before March 31, 2021, and ensure housing is available within 12 months of agreements.
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