Can The Rebirth Of A '70s-Era Government Incentive Really Help The Housing Crisis?

Canada is looking again at a tax rule from the 1970s to fight the current housing problem. Back then, from 1974 to 1981, a program called the Multiple Unit Rental Building (MURB) helped build nearly 200,000 rental units. It let investors deduct the real cost of building apartments from their taxes, encouraging more rental housing. This time, the Liberal government says MURB could be brought back as part of a wider plan to boost housing and lower costs.

Today’s housing crisis is much different than in the 1970s. Construction costs have shot up, there are fewer workers, and new housing permits take longer. Housing starts in places like Toronto have dropped significantly over the last year, especially for rental buildings. With Canada’s population more than three times bigger than in that era, the pressure to fix this is much greater.

Big names in housing development have mixed feelings. Some developers say MURB could work again, but warn delays in municipal approvals, shortages of land, and unstable interest rates would need fixing too. Others say a revived MURB must be updated—with clear rules and faster approvals—to be effective for today’s market.

MURB would shift some power to investors. Supporters argue it could steer more capital toward purpose-built rental buildings instead of condos. They say MURB offers tax perks, more control, and less market risk, especially when backed by professional building managers. That approach could help a stalled rental market regain momentum.

Industry leaders said they want more than just tax breaks. They’re asking for rules on land use to be loosened, lower fees, faster permits and reduced development charges. Provincial and city governments control many of these steps. Both Liberal and Conservative leaders say they will use federal money to push local governments to change their practices. But some builders warn money alone isn’t enough—they want clearer, easier rules too.

Developers also see other tax tools as part of the solution. Some want a rule like the U.S. Section 1031, which lets real estate owners avoid capital gains tax if they reinvest in a rental property. With condo sales slowing and rental projects struggling under high costs, a package that includes MURB, capital gains deferral, lower fees, faster permits, and land rule tweaks could help unlock more housing in Canada.