Fraser Institute: Homebuilding rate similar to 1970s levels
The data shows a general decline in housing starts per capita, especially in Ontario and B.C.
Key Takeaways:
- Since 2021, Canada’s population has grown at a historically unprecedented rate, driven largely by immigration, but new housing construction has not kept up. The report shows that this imbalance is one of the primary reasons behind the worsening housing affordability crisis.
- The report finds that, since the 1970s, there has been a general decline in the rate of housing starts per capita — especially pronounced in Ontario and British Columbia. This suggests that even before the recent surge in population, Canada was already underbuilding relative to demand.
- The mismatch between population growth and housing starts is especially severe in Ontario and B.C., where affordability has deteriorated the most. Meanwhile, provinces like Alberta have seen higher rates of construction relative to population increases, helping to moderate housing pressures.
The Whole Story:
The annual number of new homes being built in Canada in recent years is virtually the same as it was in the 1970s, despite annual population growth now being three times higher, finds a new study published today by the Fraser Institute, a Canadian public policy think tank.
“Despite unprecedented levels of immigration-driven population growth following the COVID-19 pandemic, Canada has failed to ramp up homebuilding sufficiently to meet housing demand,” said Steven Globerman, Fraser Institute senior fellow and co-author of The Crisis in Housing Affordability: Population Growth and Housing Starts 1972–2024.
Between 2021 and 2024, Canada’s population grew by an average of 859,473 people per year, while only 254,670 new housing units were started annually. From 1972 to 1979, a similar number of new housing units were built—239,458—despite the population only growing by 279,975 people a year.
As a result, more new residents are competing for each new home than in the past, which is driving up housing costs.
“The evidence is clear—population growth has been outpacing housing construction for decades, with predictable results,” Globerman said. “Unless there is a substantial acceleration in homebuilding, a slowdown in population growth, or both, Canada’s housing affordability crisis is unlikely to improve.”
