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CMHC Sees Canada's 2026 Housing Starts Below 2025 Levels as June Comes in Weaker Than Expected

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Housing starts in Canada this year are expected to be below last year's levels, as elevated uncertainty, higher development costs, weaker demand and rising unsold inventories continue to weigh on new construction activity, Canada Mortgage and Housing Corporation (CMHC) said Thursday.

The pace of housing starts in the first half of the year was already below last year's level, reflecting weaker market conditions, said CMHC's Deputy Chief Economist Kevin Hughes in a note.

"We expect that this environment will continue to hold back new housing construction in Canada over the short-to-medium term and drive 2026 actual housing starts below last year's levels," wrote Hughes.

The seasonally adjusted annualized rate of housing starts declined 6% in June to 238,971 units, down from 253,083 units in May, added CMHC.

This figure was less than the consensus figure of 256,000 provided by MUFG before the release of the CMHC data.

CMHC, the country's national housing agency, defines a housing start as the beginning of construction work on the building where the dwelling unit will be located. It uses a rate adjustment to remove the data's seasonal variations.

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