About 300 homeless people in Montreal will be picked to take part in a new federal housing project. (CBC)Hundreds of homeless people with mental illness in five cities across Canada will take part in an ambitious federal housing experiment this fall that researchers say could become a new model for helping the down and out.

The experiment – created by the Canadian Commission on Mental Health – will provide subsidized apartments and intensive psychological and social support to more than 1,000 homeless people in Montreal, Toronto, Vancouver, Winnipeg and Moncton.

The $150-million program will track participants' progress for four years and compare it to people who remain on the streets.

Researchers hope that by offering furnished housing and social support, homeless people living with mental illness will be able to reintegrate into society.

"Our gamble is that by providing this kind of intensive support, a much larger number of individuals will be able to make the transition to autonomous housing," said Eric Latimer, a health economist and associate professor of psychiatry at McGill University who is co-ordinating the federal government's program in Montreal.

Participants will have round-the-clock support, said Olivier Farmer, a psychiatrist who is one of the program's managers in Montreal.

"Some people with intense needs, sometimes we will see them twice a day, six times a week, which is a lot," he told CBC News.

The federal program takes a different approach than other projects that deal with homelessness and mental illness – and some workers in the field are concerned it's too much at once.

At Montreal's Old Brewery Mission, several homeless men have been set up in permanent apartments over the last five years — but only after they've been through addictions treatment programs and received psychological counselling.

Imposing radical lifestyle changes too quickly can result in the reintegration being unsuccessful.

"What we try to do is find people that have matured in many ways," said Georges Ohana, who runs the mission's housing program. "We don't want to prepare individuals for failure."

The federal program will last four years, and candidates will be selected next month.