Well in my country all the land is owned, either by the crown or by land owners, so at least in my country, the government would have to just...give away land? (Canada, The West)
To build a house and live sustainably it needs to be somewhat near other community surly? For access to grocery, education and health care, and then also modern opportunities. Barrie is probably the most reasonable area outside of Toronto and land out there is still very expensive. How do you see it working for someone who just graduated from college and has $200k in student debt? I know a lot of people who are stuck, I don't know the solution. If I was them and society wanted me to have a kid for the good of society, I'd say sure, give me a house and $3MM, other wise, why bother...?? Nobody wants to continue this miserable cycle.
Of course, building a new community from scratch is hard and is probably not worth it. But there are plenty of small cities that can act as "seeds".
Barrie is still in the general Toronto area, so it's expensive. Sudbury further north that is definitely not a part of Toronto anymore, has very reasonable houses for ~$400k, or 5 years of average household income in Ontario. This is well within the normal "affordable" range, so a 20-years mortgage will be around 30% of income.
The problem is, people _can't_ live in Sudbury because there are no jobs there!
My plan at some point is to do a big tech start-up in Winnipeg. Bit of other stuff still to do first, but I have an eye on Winnipeg (good flight times!!)