CMHC expands mortgage loan insurance to better support prefabricated and modular construction

OTTAWA, ON, May 7, 2026 /CNW/ - Lack of housing supply is an ongoing challenge for Canadians. To address this, Canada Mortgage and Housing Corporation (CMHC) has shown the country needs to double housing starts over the next decade. Meeting this goal of increased supply will require boosting productivity in residential construction and building smarter and faster.

Today, CMHC announced it is expanding its mortgage loan insurance offering to include more options for prefabricated and modular homes.

Prefabricated homes can be built faster and more efficiently than traditional on-site construction methods. This reduces building timelines and potentially costs for both the homebuilder and homeowner, helping to address the affordability and housing shortage challenges faced by Canadians.

Homebuyers:

Through the new CMHC Prefab Plus, homebuyers can purchase a factory-built home with a minimum downpayment of 5% and access CMHC-insured financing for their mortgage. CMHC Prefab Plus allows the homebuyer to receive funds in up to four stages (known as draws) as construction milestones are met, rather than in one lump sum.

For example, a homebuyer can take a draw to acquire and prepare their property for a prefabricated home, then take another once the home is delivered and ready to be installed on their property. This allows CMHC Prefab Plus to better support the sequencing of prefabricated home construction.

Multi-unit Construction:

Modular construction is when a housing project is built using modules that are built off-site, then transported to the property and assembled on-site. Following a successful pilot initiative, which saw insured financing provided for more than 800 new rental homes leveraging modular construction across five provinces, CMHC is expanding its multi-unit mortgage loan insurance to allow modular construction for all its multi-unit products, including MLI Select. 

The successful pilot initiative included 605 Studio West in Calgary, an 84-unit affordable housing complex developed by Attainable Homes Calgary (AHC). AHC is a non-profit social enterprise owned by the City of Calgary focusing on improving housing affordability through the development of city-owned land. Modular construction allowed 605 Studio West to be built and occupied in under one year, whereas a comparable, conventionally built project in the same community took nearly two years to complete.

Quote:

''By offering mortgage loan insurance for the financing of prefabricated homes and multi-unit modular construction, CMHC is committed to expanding access to homeownership and supporting the development of rental supply. We continue to use every tool at our disposal to deliver commercial products and results for Canadians.''

- Coleen Volk, President and CEO of CMHC

Related links:

• Framework for change: Productivity in housing construction
• Unlocking housing supply: Why scale really matters
• Solving the housing crisis is a marathon not a sprint

Canada Mortgage and Housing Corporation (CMHC) is a federal Crown corporation and a backbone institution of Canada's housing system. For over 80 years, CMHC has supported the functioning of housing markets across the country through housing finance solutions, including mortgage loan insurance and securitization--while providing trusted, unbiased data, research and market intelligence to inform policy and decision making. Through its national presence, deep expertise in housing economics and finance, and a system-wide perspective, CMHC helps foster a more stable, well-functioning housing market that supports households, communities and the broader economy.

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SOURCE Canada Mortgage and Housing Corporation (CMHC)

More information: CMHC Media Relations, [email protected]