In Quebec, it's tricky.
The Société d'habitation du Québec is responsible for allocating funds. Municipalities are clearly better suited and know the area better. Montreal has a particular status, as does Quebec City, I think.
In Quebec, the problem is that it can lead to disagreements, which would delay investments. That could also lead to Quebec not investing in housing, leaving it to the municipalities and the federal government. That's not a good idea because some small municipalities are unable to take action. If Quebec or the other provinces don't work at the regional level, that can cause problems for small municipalities.
In Quebec, there's a political issue, but the municipalities certainly know the area better and are better suited to find solutions.