Growth in residential construction was mixed across Canada’s six largest CMAs in 2022, as housing starts increased in Toronto, Calgary, Edmonton and Ottawa, remained unchanged in Vancouver, and decreased in Montréal. This according to the latest edition of Canada Mortgage and Housing Corporation’s (CMHC) Housing Supply Report (HSR), which examines new housing construction trends in Canada’s six largest CMAs.

Significant increases in interest rates influenced the activities of both developers and homebuyers as 2022 progressed. The full impact of the increase in interest rates is not yet reflected in the CMHC Housing Starts and Completions Survey, which measures the pace of construction of new residential housing in Canada.

“In some centres, seasonally adjusted housing starts began moving lower at the end of 2022 and early 2023. The higher interest rate environment will likely slow construction activity in more centres in 2023,” said Francis Cortellino, Senior Specialist for housing market analysis at CMHC.

“Some projects may become unviable at current financing rates, or construction financing will become harder to obtain,” added Eric Bond, Senior Specialist for housing market analysis at CMHC.

CMHC will be publishing its annual Housing Market Outlook forecast later this spring.

This edition of the HSR also summarizes an innovative analysis, conducted by researchers at the University of British Columbia, examining the link between housing affordability and proximity to amenities, such as health care or public transit. The study used data from CMHC’s HSR and Statistics Canada’s Proximity Measures Database to understand the “amenity richness” of new housing supply added in Canada’s six largest urban centres between 2016 and 2021. The analysis determined that almost 80% of housing starts in Canada’s six largest metropolitan areas were in low-amenity neighbourhoods, and fewer than 10% were in high-amenity neighbourhoods.

You can download and read the entire Housing Supply Report (HSR) on the CMHC website.

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