The BC condo bailout Part 2
This is the second part of a planned three-part piece on the B.C. housing crisis. Part three will follow.
In June 2026, the federal and provincial governments announced a plan, potentially worth up to $1.45 billion, to purchase roughly 2,200 unsold condo units and convert them into a rent-to-buy pathway to homeownership. Premier David Eby said the programme is intended for people who “aren’t going to qualify for social housing”, namely renters with stable, middle incomes who lack a down payment. Housing researchers at the University of British Columbia estimate that BC is short by hundreds of thousands of homes, and most of that shortfall falls on very low- and low-income households, whom this programme was never built to reach.
Middle-income renters in British Columbia face a genuine crisis. A teacher, a nurse, a tradesperson with a stable paycheque and no parental wealth are not privileged people gaming the system. If a rent-to-buy pathway helps some of them build equity they would otherwise never accumulate, that is a real benefit for real families. The problem is not that this programme exists. The problem is what had to be sacrificed to make room for it, and what that sacrifice reveals about which needs are treated as expandable and which as expendable.
Last month’s column traced how Canada’s federal government built housing policy around mortgage insurance from the outset, funded permanent non-market housing through the 1970s and 1980s, and cut that funding in 1993. Canada Mortgage and Housing Corporation’s (CMHC) own audit confirms that decision. The Parliamentary Budget Officer has since linked it to a social housing stock that stopped growing while the rest of the housing system kept expanding around it. British Columbia’s 2026 decision follows the same pattern.
CBC News reported that BC’s February 2026 budget reallocated nearly $1.4 billion from its housing strategy, largely by suspending the Community Housing Fund. The condo purchase plan, announced four months later, carries an almost identical price tag, roughly $1.45 billion. On the public record, the two announcements are not literally the same dollars moving from one programme to another. What is harder to dispute is the sequencing: a government that could not sustain grant funding for non-profits building homes for the poorest renters found, within the same budget year, financing for a programme serving renters who do not qualify for that help in the first place. As of August 2026, no specific transaction is on the table. The direct government contribution is $300 million, with the remainder financed through leveraged financing.
The suspension had already incurred real costs. Housing groups in Surrey and Squamish had spent millions preparing shovel-ready projects before the funding disappeared. The Union of BC Municipalities reports that dozens of approved Indigenous housing projects were disproportionately affected by the same funding freeze.
The Cost of Not Building
This is where the argument shifts from economics to ethics, and from ethics to plain common sense. Research on homelessness has established a causal chain that runs in one direction: unaffordable housing produces homelessness, and homelessness produces a cascade of social costs that the public bears, whether it wants to or not.
A 2022 study by the Federal Reserve Bank of Kansas City found that Housing First assistance, which provides housing without preconditions, reduces the likelihood of jail within 18 months by 95 percent, of criminal charges by 85 percent, and of emergency cash assistance by 80 percent. The cost savings from fewer jail stays, emergency room visits, and police contacts offset programme costs within 18 months. A systematic review of 26 studies found that Housing First reduced homelessness by 88 percent and improved housing stability by 41 percent compared with treatment-first approaches. In Denver, a Housing First programme reduced police contacts by 34 percent and arrests by 40 percent. In New York, participants in the FUSE programme spent 95 fewer days in jail over ten years. In Canada, the At Home/Chez Soi trial, the largest randomised controlled trial of its kind, found that Housing First produced better outcomes than requiring treatment or sobriety before housing.
The causal direction matters. The claim here is not that homeless people are criminals. Rather, it is that homelessness, as a condition of extreme stress and exposure, produces behaviours that lead to police contact, emergency health interventions, and institutional cycling. Prevent homelessness, and you prevent the downstream costs. The research is not ambiguous on this point.
What does that mean for the condo bailout? Every unit of non-market housing not built because the Community Housing Fund was suspended is not just a missed opportunity for a family to have a stable home. It is a future cost in policing, jails, emergency departments, and social services that the province will pay regardless. The government is not saving money by cutting affordable housing. It is shifting costs from prevention to crisis management and paying more for the privilege.
That gives the government a stronger ethical and social reason to fix affordable housing than to support builders of expensive condos. It is not charity. It is arithmetic.
The Pattern, Elsewhere
Ireland’s Tenant in Situ scheme, which allows local authorities to buy rental properties to prevent tenants from losing their homes, shows a similar arc on a shorter timeline. Launched in 2023 with real funding, it began buckling within a couple of years. One council reported more than a hundred purchases on hold, with only a fraction expected to close. By early 2026, funding cuts across ten local authorities ranged from 70 per cent to near-total elimination year on year.
This is not unique to housing, or to Canada or Ireland. In 2008, Washington authorised $700 billion for the U.S. bank bailout and acted within weeks. In 2009, Ottawa and Ontario invested roughly $14 billion in GM and Chrysler, framed as urgent given the jobs at stake, and recovered only a portion. Years later, Ottawa quietly wrote off part of what remained without disclosing the amount, citing commercial confidentiality.
But here is the pattern that matters most for understanding whether this is about one party or one moment. In 2008 and 2009, Stephen Harper’s Conservative government provided what the Canadian Centre for Policy Alternatives (CCPA) estimated at $114 billion in support to Canadian banks during the financial crisis, while the official narrative claimed that Canada had the “most sound banking system in the world” and needed no bailouts. The support came through CMHC mortgage purchases, Bank of Canada loans, and U.S. Federal Reserve facilities. The banks remained profitable throughout, and their CEOs received raises.
The federal government called it “liquidity support.” The CCPA called it a bailout. Whatever you call it, the pattern is the same across parties and sectors: when capital is in distress, governments of every stripe find the money and the urgency. When programmes for the poor face cuts, they vanish quietly, often without a word of explanation.
The final column in this series will examine what it would take to break this pattern: the structural incentives that perpetuate it, the infrastructure priorities that reveal where governments actually place their bets, and the proven models, both abroad and at home, that show a different path is possible.
Social Justice Watch is a column about structural patterns in public policy based on the author’s research. The author welcomes constructive feedback, factual corrections and substantive counterarguments at [email protected]