Homebuilders in Montreal, Calgary and Edmonton have been busier this year as apartment and house construction activity in the trio of cities helped push up housing starts by 4% in Canada’s six largest cities, according to the Canada Mortgage and Housing Corp.
However, the increase in starts of all types of housing through mid-year was still insufficient to keep up with Canada’s fast-growing population, according to the CMHC report. "When adjusted for population growth, per-capita housing starts were flat compared to the same period last year and not enough to keep pace with the growth in demand.”
Government incentive programs such as the CMHC’s MLI Select program pushed new builds in the rental apartment sector, as almost 50,000 apartments were launched during the six-month period, constituting 72% of all new home builds in the six Canadian cities.
The CMHC report noted that many provincial governments have passed legislation aimed at encouraging residential property construction, as Canadians have been troubled by the ongoing housing crisis. The province of Ontario passed Bill 23, allowing up to three units per lot without rezoning. British Columbia passed Bill 44 with a similar aim, Toronto and Calgary also took significant measures to allow for increased residential construction.
However, Toronto, Vancouver and Ottawa saw declines ranging from 10% to 20% from the same period last year. In Toronto, by far Canada’s largest urban area, housing starts tumbled 13% compared to the same period one year prior, largely due to a 40% decline in apartment starts from the lofty numbers posted one year earlier.
Of the nearly 50,000 apartment units that started construction in the first six months of the year, about 7,000 were located in the Greater Montreal Area, where the construction pace increased by 106% over the first half of 2023, according to CMHC. Montreal’s overall housing starts rose 58% from the six first months of 2023 when the numbers were unimpressive, hitting a 26-year low.
However Montreal continued to lag well behind the five other cities in the category of housing starts per 10,000 population.
Alberta posted some large gains as new home construction in Calgary increased by 38% during the six-month period, with 28% of rental apartment starts being the result of office-to-residential conversions. Edmonton's housing starts increased by 67% during the period, fueled by rental apartments that far outnumbered new condo starts.