Housing Starts in Canada’s Six Largest Cities Increase 4% During First Half of 2024

On Thursday, the Canada Mortgage and Housing Corporation (CMHC) reported that in the first half of 2024, combined housing starts in Canada’s 6 largest cities—Vancouver, Calgary, Edmonton, Toronto, Ottawa, and Montréal—increased 4% to 68,639 new units, the second highest level since 1990. However, when adjusted for population size, these numbers are only around the historical average and fall short of meeting growing demographic demand.

New home construction in Canada’s largest cities has shown diverse trends, reflecting regional differences in affordability and economic conditions, CMHC reported. Calgary, Edmonton, and Montréal saw significant increases in housing starts as they benefited from stronger economic growth, lower housing costs, and favorable migration trends in comparison to other major centers, pushing housing starts in Calgary and Edmonton to record levels. On the other hand, Toronto, Vancouver, and Ottawa faced declines.

New construction is increasingly shifting toward rental housing, with nearly half of apartment starts being purpose-built rentals. This shift indicates increased demand for rentals in an environment of declining homeownership affordability. The increase in rental construction also reflects demographic changes.

The CMHC report concludes that housing starts in Canada’s largest cities have increased overall, but the growth is uneven across regions. This disparity is due to varying economic conditions, affordability, and local policies. The increase in purpose-built rentals and the challenges facing condominium developments suggest a shift in the housing market landscape. Efforts by provincial and municipal governments to increase housing supply will play a crucial role in shaping the housing landscape.

While construction activity has been increasing in 2024, the overall supply is not keeping up with demand—especially in fast-growing urban centers. As economic conditions and demographic trends evolve, the housing market will need ongoing adjustments to address affordability and supply challenges, CMHC said.