Multi-family rental projects sparked a 2% rise in Canadian housing starts in 2024, says a new Canada Mortgage and Housing Corporation (CMHC) report.

According to CMHC, total housing starts in the country’s urban centres reached 227,697 units in 2024, up from 223,513 in 2023. Including an estimated 17,423 rural housing starts, the nationwide total stood at 245,120 units—also a 2% increase from the previous year.

The overall growth was largely driven by record-high rental construction levels and increased starts in Alberta, Quebec, and the Atlantic provinces.

However, Canada’s six largest markets experienced a combined 3% decline in total starts. Vancouver, Toronto, and Ottawa saw lower multi-unit starts due to weak condo presales. In contrast, Calgary, Edmonton, and Montréal recorded gains, particularly in the multi-unit rental segment.

The overall uptick marked the third-highest year on record, said Mathieu Laberge, CMHC’s chief economist and senior vice-president of market insights.

“While this annual increase shows some signs of progress, Canada still needs significantly higher supply growth to restore affordability in urban centres,” he said. Last spring, we estimated Canada could build up to 400,000 new housing units annually, based on current resources devoted to residential construction.”

CMHC’s report also highlighted that the six-month trend in housing starts remained relatively flat at 242,637 units as of December 2024, a 0.7% decrease from the previous month. Meanwhile, the seasonally adjusted annual rate (SAAR) of total housing starts fell by 13% in December to 231,468 units compared to November’s 267,140 units.

Multi-unit urban starts saw a notable decline in December, decreasing by 15% to 168,515 units, while single-detached urban starts dropped by 10% to 45,485 units.

Regionally, Alberta led the country with significant increases in housing starts, followed by Québec and the Atlantic provinces. Meanwhile, British Columbia and Ontario saw declines in housing starts compared to 2023.

“Despite December’s pullback, starts remained elevated on a trend basis, supported by purpose-built rental construction, which in turn has been lifted by robust population growth,” wrote TD Economist Marc Ercolao in the bank’s separate report on monthly starts. “Elevated home prices have also likely offered some support. Residential permit issue remains robust, pointing to further near-term gains.”

Even with starts elevated nationwide, a “divide” has emerged between Ontario and other parts of the country, he added. Ontario starts are trending downward as condo construction projects retrench under the weight of weak demand.

“Further declines in Ontario are likely on tap for this year, which, when combined with cooler population growth, points to a pullback in Canadian starts in 2025,” he wrote.

Photo: TD Economics