Built for the North: How builders are tackling the territories’ shortages, high costs

A hybrid modular home, shown in an undated handout photo, is transported by truck. Homes like these are made at a facility in Hay River, N.W.T, by general contractor and design company Arcan Group. THE CANADIAN PRESS/Handout – Arcan Group (Mandatory Credit) – The Canadian Press

As Sarah Newton sifts through posts on community Facebook groups, the Whitehorse resident says there’s an almost daily call-out that’s become impossible to ignore.

Personal ads in search of housing, both among locals and transplants to the northern city, are everywhere. But with such limited availability, Newton says finding a place to live is a challenge not only for people with low incomes, but even those with a plentiful budget.

Whitehorse has for years been among Canada’s fastest-growing cities, but Newton fears the housing shortage is leaving the community behind.

“It’s actually insane, the lack of housing for people,” said Newton, the board president of the Northern Community Land Trust, a non-profit that builds permanently affordable housing in the Yukon.

“We have a really high need for teachers, for education assistants, for health-care workers, for construction workers, and these are the types of people that we can’t bring into our territory right now because of the lack of housing.”

Housing shortages are a common issue across Northern Canada, which faces distinctive challenges to build new supply — from environmental factors to supply chain dynamics.

As policymakers and stakeholders call for increased housing across the country in order to improve affordability for homeowners, those with specialized knowledge of the North say the region requires an approach “designed specifically for northern realities.”

A report published last month by Canada Mortgage and Housing Corp. said housing in the three territories was less affordable in 2025 compared with 2021 as “critically low availability” limited both market and subsidized options.

Per-capita housing starts remained below the rest of Canada, constrained by high construction costs, limited serviced land, along with logistical and labour challenges.

“The places like Whitehorse, the broad outlines of the story are the same as in large urban areas in Canada, but if you look more broadly at the territories and particularly at Nunavut, the situation is different,” said Aled ab Iorwerth, deputy chief economist for the national housing agency.

“Yes, the cost of housing is high and the (lack of) affordability is there, but you also in Nunavut have issues related to building quality and to overcrowding.”

Up north, market-price housing is almost exclusively concentrated in the territorial capitals, ab Iorwerth added, which is likely linked to the cost of construction.

“The season for building when the weather is acceptable is obviously quite short. You have long transportation supply chains to get the materials to the North, so energy costs are important,” he said.

“It’s not a large market, so you have limited economies of scale. There’s probably limited access to a workforce that can build, so all of this is leading to significant challenges on construction costs.”

Future affordable homes are seen under construction in an undated handout photo, in Whitehorse. The section shown is part of the Northern Community Land Trust’s Project 1096, which will feature 32 units ranging from one to three bedrooms. THE CANADIAN PRESS/Handout – Northern Community Land Trust (Mandatory Credit)

The lack of affordability has led to a growing need for the model that Newton’s group is championing. The land trust is nearing completion on its first major project, a 32-unit housing complex in Whitehorse that will allow locals to buy at a discounted price thanks to land donations, federal and territorial funding, along with “efficient” design.

The development is built with local conditions in mind, with features such as fireproof siding.

“We have kept environmental, energy-efficient and sustainable designs at the top of our priority list because we believe that affordability is not about building cheap, it’s about building durable and it’s about building for the future,” said Newton.

In addition to long and often harsh winters limiting when construction can take place, many materials need to be shipped from larger cities, which doesn’t happen overnight.

“We’ve had to order kitchen cabinetry from down south … and that’s been really challenging because if anything was missing or mis-ordered, it’s not like you can just run over and pick the thing that you need up,” said Newton.

“There’s timeline delays on getting certain things in at specific times because of that.”

The CMHC’s report said the North presents unique challenges, but also “opportunities for innovation.” That includes “more regionally responsive design and energy-efficient housing solutions that respond to Northern and Arctic conditions.”

It highlighted projects like the Kivalliq Long-Term Care Facility in Rankin Inlet, Nvt., which incorporates building orientation, thermal performance strategies, natural light and passive and mechanical heating systems to enhance comfort under Arctic conditions.

Hybrid modular homes under construction at a facility, shown in an undated handout photo in Hay River, NWT, are transported to northern communities by general contractor and design company Arcan Group. THE CANADIAN PRESS/Handout – Arcan Group (Mandatory Credit)

Arcan Group, a general contractor and design company based in the Northwest Territories, has turned to building “ready-to-move” homes for the past four years, as part of a partnership with the Hay River Métis community.

Hughie Graham, director of partnerships and development for the company, described the model as “hybrid modular construction.” Components of homes are built year-round in a tented facility, rather than at construction sites when the elements allow.

Those pieces are then transported to local communities to be put together on-site.

“We build homes there that are engineered for Arctic conditions,” he said, adding the North “doesn’t need southern solutions for building.”

Graham said prefabrication improves quality control and limits weather-related delays. While many modular housing units in the region have come from Southern Canada over the years, he said some don’t meet the standards needed for northern conditions.

Arcan’s design, he said, allows for “highly energy-efficient structures with modern mechanical systems” that are built to last longer. The style includes additional exterior insulation, and also avoids the board and batten which southern builders sometimes use so they don’t have to worry about drywall cracking during transportation.

“The cost of heating a place in Ulukhaktok, for example, is three times what it is in Yellowknife, and Yellowknife is three times what it is out of Calgary,” said Graham.

“So if we can make an energy-efficient product, it’s less costly to provide utilities for.”

Hybrid modular homes, shown in an undated handout photo under construction at a facility in Hay River, NWT, are transported to northern communities by general contractor and design company Arcan Group. THE CANADIAN PRESS/Handout – Arcan Group (Mandatory Credit)

To date, Graham estimates Arcan has built homes in about half of the Northwest Territories’ 33 communities. But he said builders collectively haven’t made enough of a dent in the North’s overall supply crunch, and the biggest challenge they’re facing is attracting workers.

He said as populations continue growing and existing infrastructure ages, labour is the area where the industry stands the best chance at lowering costs.

“We know that there’s such a shortage of housing that if you’re going to throw 500 homes into the Northwest Territories today, you have not scratched the surface of how much housing needs to be built in the North,” said Graham.

“If we could get some federal and territorial investment … to offset the labour, that’s probably the largest component of the cost of construction. If we can offset that somehow, items start to become more affordable.”

This report by The Canadian Press was first published Aug. 16, 2026.

Sammy Hudes, The Canadian Press

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