Regulatory Hurdles Challenge Adoption of Modular Housing Methods in Toronto

The Canadian housing sector is facing significant distress, marked by historic lows in housing starts and a glut of cancelled pre-construction condos. While innovative materials like mass timber and modular construction offer clear paths to affordability and sustainability, their widespread adoption remains constrained by policy inertia and financial risk.

Ria Perrault, who leads MaRS’s Better Buildings mission, stressed that improving affordability requires more than just better materials; it demands simplifying zoning rules and harmonizing building codes to allow these novel methods across all jurisdictions. She noted that companies manufacturing expensive components off-site require substantial working capital at the outset, a need that current financing structures do not meet.

Companies like Intelligent City are prepared to scale new manufacturing facilities in Ontario but acknowledge they must overcome developer hesitation. To commit to modular techniques, developers need predictable demand and incentives, such as better financing deals or increased density allowances, to balance the perceived risk of adopting new methods. Without such support, MaRS warns that the industry risks remaining tied to outdated construction practices for decades.

The convergence of these issues suggests a critical policy gap: while the market needs rapid supply, regulators must first create stable financial and legal pathways for modern building science to thrive.