Why Canada’s Affordability Crisis Comes Down to One Number: Doubling the Build Rate
Every housing debate eventually returns to the same uncomfortable arithmetic. This week the Canada Mortgage and Housing Corporation put a hard figure on it. To bring affordability back to where it stood before the pandemic, the country needs to build somewhere between 417,000 and 469,000 homes a year over the next decade. Right now, we are on pace for about 231,000. That is not a shortfall. That is a gap wide enough to define an entire generation of housing policy.
I have spent my career looking at land, timing, and infrastructure as the real levers of housing outcomes, and this report confirms what those of us in development strategy have been saying for years. Affordability is not fixed by rate cuts or short term incentives. It is fixed by supply, and supply is a function of feasibility. CMHC itself points to the real constraints: construction costs remain elevated, presale financing is difficult to secure for many projects, and soft condominium conditions have made developers cautious about launching anything new. Doubling national output is not a slogan. It requires solving each of those constraints market by market.
What stands out most to me is how uneven the picture is across the country. Toronto’s supply gap has narrowed, but largely because prices have softened, not because construction has meaningfully accelerated. Calgary tells a healthier story, with a genuine pickup in construction activity closing its gap organically. Vancouver remains the market to watch. Despite some short term easing in prices and starts, CMHC expects that progress to slow as population growth reasserts pressure on demand. Ottawa and Montreal are heading the other direction entirely, with demand projected to outrun new supply in the years ahead. Edmonton, meanwhile, remains the model case, with construction that has largely kept pace with population growth and virtually no measurable gap.
There is also a tenure story buried in this data that developers and planners need to take seriously. Purpose-built rental now accounts for two-thirds of apartment starts in major markets, which means renters in cities like Toronto, Vancouver, Ottawa, and Montreal may feel relief sooner than owners will. CMHC frames this as a risk to long term homeownership affordability, and I agree. When capital and construction capacity concentrate in one tenure type, it reshapes who gets access to equity building and who does not. That is a policy question as much as a market one, and it belongs in every regional growth strategy being drafted right now.
Restoring affordability will require not only more housing, but the right mix of housing to meet future needs.
CMHC does note that policy tools are already helping at the margins. Government financing programs, reduced or deferred development charges, and zoning reforms are improving project viability, particularly for rental housing. These are the right instruments. The question is scale. Municipalities and provinces that want to close their local supply gap should be studying which of these levers moved the needle in Calgary and Edmonton, and applying that lesson faster than the demand curve is moving against them in Ottawa and Montreal.
The bottom line for anyone shaping large scale housing strategy is this. Affordability will not be restored by hoping demand cools. It will be restored by treating construction capacity, financing conditions, and zoning reform as the coordinated system they actually are. The markets doing that already, Calgary and Edmonton among them, are proving it can be done.
Source: Global News, “Want 2019 housing affordability? Canada must double building rate: CMHC”
