In the 1980s, the community voiced serious concerns about the living conditions of consumer/survivors housed in boarding homes, mainly in the Parkdale area. Habitat Services was established in 1987 to address these concerns.

The City of Toronto, the Ministries of Community and Social Services, Health, and Housing, the Municipality of Metropolitan Toronto and the Supportive Housing Coalition discussed strategies. They developed the concept of using a contract to standardize services and improve housing standards in boarding homes. The details were worked out by consulting with consumer/survivors, advocates, representatives of the provincial and municipal governments, mental health workers and boarding home operators. The result was the Habitat Model.