May 20, 2025

A recent study by the Canadian Home Builders’ Association (CHBA) highlights a growing concern: Canada is constructing fewer homes relative to its population growth than ever before. This trend has exacerbated housing affordability challenges, particularly for young families seeking both rental and ownership options. The study examined 23 municipalities nationwide, focusing on municipal fees, development application timelines, and support systems for applicants.

The concept of “filtering” in housing refers to the process by which properties transition from higher-income to lower-income households over time, thereby becoming more affordable. This typically occurs through two main mechanisms: vacancy chains and depreciation. Vacancy chains are initiated when a household moves into a more expensive home,

In February 2025, Canadian home sales experienced a significant decline, dropping nearly 10% month-over-month to reach their lowest level since November 2023. This downturn was widespread, with approximately three-quarters of local markets, including major urban centers like Toronto and the Greater Golden Horseshoe region, witnessing substantial decreases.

Ontario’s housing crisis is intensifying due to a combination of factors, including a significant decline in new housing applications, a shortage of skilled labor, and complex zoning regulations. In 2021, there were 2,482 housing applications submitted in the Greater Toronto Area (GTA); this number dropped to 1,225 by 2023, indicating a substantial slowdown in development activity.

Canada’s housing crisis is shaping up to be a defining issue in the 2025 federal election, with affordability and supply challenges pushing the matter to the forefront of public concern. Years of escalating home prices, coupled with sluggish construction rates, have made housing a national economic and social issue.

A recent Bank of Canada (BoC) survey reveals a significant decline in Canadian renters’ intentions to purchase homes within the next year. In the first quarter of 2025, only 16.1% of renters planned to buy a home, marking a sharp 9.9 percentage point drop from the previous quarter—the steepest quarterly decline since the BoC began tracking this data.

In early 2025, the Canadian Real Estate Association (CREA) significantly downgraded its housing market forecast due to escalating economic uncertainty stemming from U.S.-imposed tariffs. Initially anticipating an 8.6% increase in home sales for the year, CREA revised its projection to a mere 0.3% growth, expecting approximately 482,673 residential properties to change hands.

The federal government is making significant investments to address housing challenges in Northern Ontario. Through initiatives like the National Housing Strategy (NHS), over $40 million has been allocated to build and repair 149 homes across eight projects. These efforts prioritize vulnerable populations, including Indigenous communities, seniors, and those at risk of homelessness.

Ontario’s housing market in 2024 experienced significant shifts in buyer behavior and market dynamics. Multi-property owners (MPOs), who previously dominated the market, have reduced their activity, especially those with large portfolios. The proportion of MPOs owning 11 or more properties decreased from 13% in April 2022 to 7.2% in 2024, indicating a strategic downsizing amid changing market conditions.

Canada’s housing market is experiencing significant strain due to the ongoing trade tensions initiated by U.S. President Donald Trump. According to a report by the Royal Bank of Canada (RBC), housing resales have declined across the country, with the most pronounced decreases observed in southern Ontario and British Columbia.