Increasing our understanding of housing supply in Canada

Canada’s housing system is complex and there are several reasons for the steep, continued price escalation. The biggest issue affecting housing affordability in Canada is that supply simply isn’t keeping pace with demand.

Throughout 2022 and 2023, Canada Mortgage and Housing Corporation (CMHC) will be publishing a series of reports to help deepen its understanding of housing supply challenges in Canada and to ultimately inform better policies and decision making.

The first report of this series, the Housing Supply Report (HSR), provides insights on new housing supply in Canada’s major cities and urban areas. The primary data source for this report is CMHC’s Housing Starts and Completions Survey, which collects data on monthly residential construction activity. Released on a bi-annual basis, this work will help governments at all levels make policy decisions that support housing affordability for all Canadians.

Housing Supply Report:

The inaugural Housing Supply Report (HSR) aims to increase understanding of the current housing supply trends in the six largest Canadian Census Metropolitan Areas (CMAs) of Toronto, Montreal, Vancouver, Calgary, Edmonton, and Ottawa. We examine trends within and across these markets using analysis themes such as:

• Relative growth in the housing supply per capita, both across centres and over time.
• Intensity of development (units per structure) and building height.
• Diversity of new housing, like apartments and rentals versus single-detached.
• Spatial distribution of new housing supply within CMAs.

Quote:

“The number of housing starts was high in several census metropolitan areas (CMAs) in 2021, compared to the average of recent years. Despite this, the types of structures built and the target market for the new units they contained varied from one area to another,’’ said Eric Bond and Francis Cortellino, Senior Specialists for housing market analysis with CMHC. “Exploring the different realities of these CMAs helps us better understand why some markets are more affordable than others.”

Report highlights:

• Housing starts have struggled to keep up with population growth in some CMAs, especially Toronto, making affordability a significant challenge.
• Apartments (including units for rent or for ownership) dominate construction in large urban centres, such as Montréal, Toronto, and Vancouver. In these CMAs, the various constraints (land, bylaws, etc.) are more significant in pushing up land prices. In Calgary, Edmonton, and Ottawa, meanwhile, starts of houses (includes single, semi-detached, and row) remain strong.
• The proportion of rental housing starts increased in several CMAs, including Montréal and Vancouver. However, rental housing starts remain low in Toronto.
• Toronto prevails in the construction of high-rise apartment buildings with hundreds of units (includes units for rent or for ownership). For many other CMAs, a multitude of buildings with fewer units and floors dominate the urban landscape.
• These different types of buildings can have different construction times and costs. Some CMAs may therefore be able to deliver new units more quickly and at a different cost, thereby influencing market affordability.

For information on this release:

CMHC Media Relations
media@cmhc-schl.gc.ca

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Backgrounder:

We strongly believe that better, more informed housing decisions are made with the availability of quality housing market data and insights. The HSR aims to increase understanding on the state of housing supply before providing insights on the gaps and opportunities. We’ll continue to share new data, indicators and insights exploring different aspects of housing supply in Canada.

Building upon the launch of the HSR, in the coming weeks look for the CMHC Housing Market Insight (HMI): Household Projections, which will report the results of the projected number of households who will need to be housed by Province and Census Metropolitan Area (CMA) to 2030. These household projections will serve as the foundation in determining future household demand and supply.

And this summer, CMHC will publish a report toprovide a dynamic analysis determining the magnitude of housing supply gaps today and going forward to 2030 for Canada and select provinces.