Beginning in 1945 Canada had a relatively successful housing policy meeting the needs of returning veterans, baby-boom parents, and, later, baby boomers themselves in addition to those less advantaged through a number of income-support housing programs. The reasons for this success are well documented and largely relied upon the dominance of the federal government in this policy space. This was achieved despite housing being constitutionally primarily a provincial responsibility due to a process known as ‘cooperative federalism’. This success ended in the mid-1990s and Canada has not had a national housing policy, nor successful provincial policies, since that time. Much of the demise of housing policy can be attributed to what at the time was considered to be a unique Canadian federal phenomenon called ‘province building’. We look at the institutional arrangements which made for a successful housing policy for nearly fifty years and the institutional failings which led to its demise. In particular, we analyse why the unique position of municipalities in Canada vis-à-vis other federal states made it more difficult to deal particularly with planning and social housing problems in Canada. The lessons of Canada are apt for other federal states trying to trade off regional and ethnic interests versus national priorities.