In the first six months of 2025, Ontario recorded only 27,368 housing starts — a significant decrease from previous years. This marks a serious setback for the province’s plan to deliver 1.5 million new homes by 2031.
Toronto, Canada’s largest housing market, faced the most dramatic slowdown with a 44% year-over-year decline, resulting in roughly 12,575 new units. Smaller municipalities such as Guelph were hit even harder, with housing starts falling by 76% and only 46 new homes breaking ground.
In contrast, Ottawa emerged as an outlier with approximately 5,150 housing starts, representing an 82% increase compared to the same period in 2024. This divergence highlights how regional market conditions vary across Ontario.
Experts point to high construction costs, rising interest rates, and delays in development approvals as key reasons behind the slump. These factors are making it harder for developers to move forward with new projects despite strong demand.
“Without a steady pipeline of new homes, Ontario risks worsening affordability issues and falling short of its long-term housing goals,” warned one industry analyst.
Key Takeaways for Real Estate and Business
- Ontario’s housing supply shortage is intensifying, adding pressure on homebuyers and renters.
- Provincial targets to build 1.5 million homes by 2031 are increasingly difficult to achieve.
- Construction sector slowdown may affect jobs, suppliers, and municipal revenues.
- Ottawa’s growth offers a rare positive note, but uneven performance across cities could widen economic gaps.
- Businesses in real estate and construction should prepare for tighter conditions and push for supportive policies.
