GUEST SUBMISSION: Canada is building more homes. But are we building them right? As the country races to address a generational housing shortage, a critical question is being left off the table: What will it actually cost to live in the homes we’re building? 

Building codes are improving, and that matters. New homes are more energy efficient, better insulated and more airtight than those built a generation ago. But code compliance is a floor, not a destination. And in many cases, homes built to today’s minimum standards are locking future residents into utility bills that quietly undermine the very affordability they were built to provide.

Consider a typical 2,000-square-foot electrically heated home built to today’s code. Annual heating energy consumption runs approximately 27,900 kWh. At $0.15 per kWh, that’s roughly $4,185 per year just in heating costs. For a family already stretched by a mortgage, that number is not a footnote. It’s a financial burden they never anticipated.

Now suppose that same homeowner invests an additional five per cent at the time of construction, approximately $35,000 on a $700,000 build to meaningfully improve energy performance. Financed through a typical mortgage, that premium adds roughly $180 to $200 per month to their payment.

The affordability illusion

Here is where the performance level chosen makes all the difference:

• A Net Zero Ready envelope can reduce heating demand by roughly 30 per cent, dropping annual heating costs to approximately $2,925, a saving of about $1,260 per year or $105 per month.
• A Passive House-level build can reduce heating demand by up to 90 per cent, bringing annual heating costs to approximately $420, a saving of roughly $3,765 per year, or $314 per month.

That distinction is the crux of the issue. A modest efficiency improvement adds cost without adequately offsetting it. A deep performance improvement can come close to paying for itself and continue generating savings for the life of the building. Net Zero Ready is a step forward. Passive House changes the equation.

The builder opportunity most are missing

This is not only a homeowner story. For developers and builders, high-performance construction represents a significant and underutilized competitive advantage. In a market where projects compete on price and location, demonstrable operating cost savings are one of the few genuine differentiators available.

A builder who can show a prospective buyer that their home will cost $250 per year to heat/cool versus $4,000 for a comparable code-built alternative has a compelling value proposition that goes well beyond the purchase price.

Non-profits, housing providers and landlords acquiring affordable rental properties are increasingly focused on total cost of ownership. A building that costs far less to heat and cool is simply a better long-term asset. As energy prices continue to rise, that advantage only grows.

There is also a warranty and liability dimension. Moisture damage, mould remediation and enclosure failures remain among the most costly post-construction problems builders face. Hygrothermal modelling tools now widely accessible to design teams can evaluate how wall and roof assemblies will perform under real-world conditions before a single nail is driven. Builders who invest in this step are not just protecting future residents; they are protecting themselves.

Where to focus: The enclosure first

The industry’s instinct is to focus on mechanical systems: more efficient furnaces, heat pumps, smarter thermostats. These improvements matter, but they address the symptom rather than the cause. 

A heat pump can only respond to heat loss. The building enclosure determines how much heat loss occurs in the first place. When heating and cooling demand is reduced by 80 to 90 per cent at the enclosure level, the equipment needed becomes smaller, simpler and far cheaper to run. The energy savings are large enough to be felt every month.

Canadians spend approximately 90 per cent of their lives indoors. Yet the performance standards guiding most new construction are still primarily designed to keep buildings standing, not to keep the people inside them healthy, comfortable and financially secure over the long term.

The right question

The conversation in Canada’s housing sector has been framed around supply: How many homes, how fast, at what cost to build? That framing is incomplete.

Affordability is not determined by construction cost alone. It is determined by what a home costs to own, operate, maintain and live in for decades. A home that costs $35,000 more to build but saves $300 per month in utility bills is not an expensive home. It is a better investment for the buyer, the builder and the housing system as a whole. 

The question should no longer be whether to build beyond code. It should be whether we are building far enough beyond code to make the investment genuinely worthwhile and to stop inadvertently building the affordability crisis of the next generation.