Canada Still Needs Nearly Double The Homebuilding Pace

CMHC's June 2025 housing-supply-gap update says Canada needs between 430,000 and 480,000 housing starts a year through 2035 to restore affordability to the levels last seen in 2019. In the same framework, the agency puts the country's projected business-as-usual pace at about 245,000 to 250,000 starts a year.

The official estimate leaves a gap of roughly 180,000 to 235,000 starts a year between the business-as-usual pace and the affordability-repair pace.

CMHC says total housing starts across all areas in Canada reached 259,028 in 2025, up 5.6 percent from 2024 and the fifth-highest annual total on record.

The 2025 total covered about 54 percent to 60 percent of the annual pace CMHC says is needed.

CMHC's framework runs through 2035, not one monthly release or one interest-rate cycle.

The supply gap requires sustained output above the business-as-usual path for years, according to the agency's own model.

CMHC's housing-gap explainer does not pin the problem on one villain. It says fixing the shortage will require a much larger workforce, more investment, less regulation and delays, and better productivity. The agency also says its newer methodology now explicitly factors in extended approval and construction timelines.

CMHC says local governments funded through the Housing Accelerator Fund issued 160,585 residential building permits in the program's first year, about 22,000 more than expected.

Statistics Canada says Canada's population fell by 103,504 in the fourth quarter of 2025 as non-permanent resident counts declined.

CMHC's 2035 horizon still reflects approval timelines, construction timelines, workforce needs, investment, and productivity limits.

The CMHC benchmark creates a simple annual comparison: 430,000 to 480,000 required starts against actual starts, permits, approvals, labor capacity, and productivity.

The 2025 total of 259,028 starts kept Canada below the required pace even in one of its highest-output recent years.