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The National Building Code (NBC) is published every few years and sets out technical requirements for the design and construction of new buildings, as well as alterations and demolition of existing structures. For the most part, the code governs property such as military bases, land and airports that are under federal jurisdiction and is the model for all of the provincial codes. The whole idea is to determine and specify the minimums required to ensure buildings are safe, accessible and structurally sufficient. The latest edition of the code was published in 2020 by the National Research Council of Canada and incorporated 280 technical changes. The 2025 building code is scheduled to be released later this year.
However, RESCON has called on the federal government to pause the 2025 version of the NBC being released because it is both ill-timed during a national housing affordability and supply crisis and in direct opposition to the spirit and intent of mandates set out by Prime Minister Mark Carney to his ministers. We sent a letter to Carney, Innovation, Science and Industry Minister Francois Philippe Champagne and Housing, Infrastructure and Communities Minister Gregor Robertson. RESCON wants the 2025 NBC paused while a full review and investigation is conducted to verify that the fundamental principles of the prime minister’s mandates – namely bringing down costs for Canadians, helping them get ahead, and making housing more affordable – are fully and thoroughly considered before it is implemented. These are important steps in attempting to restore the dream of home ownership for all Canadians.
The NBC is an important tool to ensure that buildings are safe and structurally sound. However, the code has been broadened to include direction far beyond the basic principles of health, safety, fire protection and structural sufficiency and evolved into a regulatory mechanism for implementing social policy initiatives. This divergence from the original mandate has significantly impacted construction costs, resulting in homes that fewer Canadians can afford. In our letter to the prime minister, RESCON notes that, since 2015 under former Prime Minister Justin Trudeau, the direction and policy development for the NBC was broadened far beyond the basic principles of health, safety, fire protection and structural sufficiency as minimum requirements. Over the last decade, building codes like the NBC have increasingly been used to address social public policy agendas rather than focusing on its actual mandate of safeguarding building occupants. Additionally, the divergence from the original mandate of the NBC has significantly impacted construction costs, resulting in homes that fewer Canadians can afford. It is no coincidence that there has been an erosion of housing affordability across Canada following the release of the 2015 NBC.
Fundamentally, building code regulations should follow industry innovation, not lead. The residential building industry, including manufacturers, labour and regulators should only be compelled to evolve and progress at a pace that is practical and economically viable for Canadian consumers. When government and social policy objectives become the defacto driver of innovation, the free market responds negatively, as we are witnessing because of escalating new home prices across Canada.
The 2025 NBC will be taking aggressive leaps forward in social policy based upon mandates from the previous government, some of which date back as far as 2015, and will likely add tens of thousands of dollars in construction costs to every new home built to meet its evolving requirements. Work has already started on the development of the 2030 NBC. The mandates and directives for that update also continue to be sourced from the policies of the previous prime minister. With the change in government, escalation of the housing affordability and supply crisis, along with the on-again, off-again tariffs by U.S. President Donald Trump that threaten to disrupt supply chains, the next iteration of the building code must reflect the realities of the economy and mandate of the prime minister. This is of critical importance as builders who construct most of the new housing in the province are in the midst of a crisis.
The tax burden on new homes – which includes taxes, fees, levies and development charges – has risen dramatically over the years and is crippling the market. Middle-class families are being priced out of new homes. Presently, taxes comprise 36 percent of the cost of a new home, up from 24 percent in 2012. The price of a single-family now exceeds 11 times middle-class incomes. Twenty years ago, it was less than six.
The result?
Housing and condo sales have taken a beating. In Ontario, housing starts in the first quarter of 2025 totalled 12,700 units – 20.2-percent below the figure for the fourth quarter of 2024. Housing starts were down 58 percent in Toronto and 29 percent in the rest of the GTA during the first five months of 2025, compared to the same period in 2024. Meanwhile, a recent report by CMHC revealed that condo sales in Toronto fell 75 percent between mid-2022 and the end of Q1 2025. The situation is looking much worse than during the early 90s. Developers and builders as well as preconstruction sales brokerages have already laid off workers and industry businesses are reducing their staff. The knock-on effect of the lack of sales and starts as well as job losses could be catastrophic for the economy.
Builders want to build houses that consumers can afford. When the tax burden and building standards inflate the cost to consumers, they simply stop buying new homes. In light of the circumstances, we must align the building code with the realities of the current crisis.
Richard Lyall is president of the Residential Construction Council of Ontario (RESCON). He has represented the building industry in Ontario since 1991. Contact him at me***@****on.com.