Record rental construction is driving housing starts in Canada’s largest cities, such as Toronto, Montreal, and Vancouver. According to recent data, nearly half of the new apartment units started in the first half of 2024 were purpose-built rentals. This surge in rental construction is being fueled by strong demand for rental housing, high homeownership costs, and government incentives aimed at addressing housing shortages.
Despite these gains, the overall construction pace is still insufficient to close the housing supply gap, especially in cities with significant affordability challenges like Toronto and Vancouver. High interest rates and regulatory delays continue to limit the construction of condominium apartments, as developers face challenges in securing financing and meeting pre-construction sales targets. However, rental units are becoming increasingly important, particularly as more Canadians rely on the rental market due to rising homeownership costs.
This trend highlights the growing role of rental housing in Canadian cities, as both private developers and policymakers focus on increasing rental supply to meet demand and alleviate housing affordability issues. Details here.
