Alberta and Quebec Narrow Housing Construction Gap as Ontario Faces Sharp Slowdown

Alberta and Quebec Narrow Housing Construction Gap as Ontario Faces Sharp Slowdown

Canada: Ontario is experiencing a noticeable slowdown in residential construction, with seasonally and trend-adjusted housing starts at 60,236 units in June. Alberta, with less than half of Ontario’s population, closely follows with 58,882 starts, while Quebec is just behind at 58,849. This narrowing gap raises concerns, as larger provinces are typically expected to lead in new housing based on their population growth. Although British Columbia saw a spike in June, its six-month trend-adjusted housing starts still trail the other three populous provinces. The slowdown in Ontario and British Columbia highlights a growing imbalance between housing supply and demographic demand.

The shortage of new housing supply is impacting affordability, especially for mid-income households in Ontario and British Columbia. Despite a softening rental market, homeownership remains out of reach for many, with average home prices in cities like Toronto staying above $1.1 million USD. The post-pandemic decline in Ontario's residential construction is largely due to its reliance on multi-family developments such as condominiums and rental towers. Weaker investor interest, tighter financing, and higher construction costs have significantly reduced the pipeline for these projects, compounding supply challenges and increasing pressure on the housing market.

Sources: FINANCIAL POST