Housing construction is so behind in Toronto that a new report gave the city a failing grade for new home starts.
'We have crushed the next generation. I hate to say that,' says CEO of RESCON, which published report
Britnei Bilhete · CBC News
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Housing construction is so behind in Toronto that a new report gives the city a failing grade for new home starts.
Housing starts are down in Toronto by 58 per cent and sales are lagging by 91 per cent, according a report card by the Residential Construction Council of Ontario (RESCON), which analyzed 34 municipalities in the Greater Toronto Area and Greater Golden Horseshoe, and compared recent numbers to January-June averages from 2021 through 2024.
Toronto is one of 22 municipalities given an F, including Brampton, where housing starts have fallen by 50 per cent. Overall, housing starts have decreased by 40 per cent, the report found.
The data paints a bleak picture of Ontario's ongoing housing crisis, says Richard Lyall, CEO of RESCON.
"The housing situation is actually much worse than people think it is and it's going to be even worse going forward," he told CBC Toronto.
"We have crushed the next generation. I hate to say that," Lyall said. "My generation has failed."
Just over a month ago, updated numbers revealed the Ontario government had once again failed to meet its goal for housing starts in 2024, even after expanding ways to count them. Its goal is to build 1.5 million homes by 2031, and last year's target was 125,000 new homes. Instead, the province counted 94,753, which included long-term care beds and post-secondary dorms.
Meanwhile, the province's financial accountability officer flagged earlier this year that 2025's housing starts are also lagging.
In the first quarter of this year, construction began on 12,700 housing units, which financial accountability officer Jeffrey Novak said is the lowest level since 2009.
WATCH | Home building is struggling in Ontario: Ontario is far off its housing starts goal
In a statement the provincial government said it has made it easier for municipalities and builders to deliver housing.
"We have eliminating [sic] the full 13 per cent HST on purpose-built rental housing, offered a 75 per cent rebate on the provincial portion of the HST for new homes priced up to $400,000 and delivered a record 14,000 new rental starts since the beginning of the year," said Alexandra Sanita, press secretary for the minister of municipal affairs and housing.
"This is in addition to the $1.6 billion we have invested through the Municipal Housing Infrastructure Program to unlock over 800,000 homes since 2024 and $1.2 billion through the Building Faster Fund."
Job numbers already dropping
By its calculations, RESCON says the residential construction industry in Toronto has lost about 10,209 jobs this year alone as a result of lagging starts.
"We're deeply concerned about this because we've got companies that are laying off crews and project teams right now in huge numbers," Lyall said.
"Systemically, we made a big effort to attract people into careers and construction, and those jobs aren't going to be there."
The workforce at the Labourers' International Union of North America (LiUNA) Local 183, one of the biggest construction unions in Ontario, has already tracked a reduction in hours of employment over the last six to eight months, said Jason Ottey, its director of government relations and communications.
"There's a vacuum forming" as pandemic-era projects get completed, Ottey said, noting that work has since slowed down dramatically.
"What we are seeing are too many people chasing too few projects," he said.
"We are all hoping that … there's a rebound in the housing market."
Severely stunted housing starts threaten long-term capacity and affordability, says Eric Lombardi, founder and president of More Neighbours Toronto, an advocacy organization focused on ending the housing crisis.
"My fear is sort of a situation that happened in countries like Ireland in 2008, where bad public policy and a bit of investor exuberance led to a spike in housing prices through 2008 and then a housing collapse in the aftermath," he said.
"They had a lot of home builders that just ended up going out of business."
'Too many regulatory hurdles'
Lombardi says one of the solutions the province needs to consider is tax reforms "to ensure projects can actually get off the ground and we're not adding these extra costs to the sticker price of buying anything new."
Development charges are one of those extra costs that have gotten "out of control," said Lyall.
"In Toronto's case, for example, in 1999, development charges for a new home were $5,000, right? Adjust that fully for inflation today you're up to $10,250," he said.
"But today, development charges on a new house are $195,000. How do you rationalize that?"
Another key factor working against builders is excessive red tape and inefficiencies in the approval process, Ottey said.
"There are too many regulatory hurdles," he said.
Ontario will continue to work with municipal and federal partners to ensure more homes are built faster, Sanita said in an emailed statement, "including calling on the federal government to reduce their portion of the HST and GST."
In June, the House of Commons unanimously voted for the Liberals' promised income tax cut which included a first-time home buyers' GST/HST rebate. When the proposal was officially announced in March, Prime Minister Mark Carney wrote that "eliminating the GST will save first-time homebuyers up to $50,000 and spur housing construction across the country."
ABOUT THE AUTHOR
Britnei Bilhete is a reporter with CBC Toronto. She previously worked as a producer with the CBC News social media team and reported for CBC Nova Scotia. You can send your story tips to her at britnei.bilhete@cbc.ca.
