Ontario is behind most of its Canadian peers on homebuilding to start 2025.
Housing starts (homes that started construction) and building permits (homes that could be built soon) are both trending in the wrong direction.
The province saw 33 per cent fewer housing starts this January and February (8,176) compared to the same two months last year (12,136), according to data released by the Canadian Mortgage and Housing Corporation (CMHC) on Monday that details starts in urban areas with populations of 10,000 and up.
That's the second-worst percentage decrease in housing starts among Canadian provinces and territories, next to New Brunswick, which saw a 34 per cent drop, from 553 to 366 units.
Ontario, which represents about 39 per cent of Canada's population, saw just 27 per cent of the nation's housing starts in the first two months of 2025.
"It's a big, big problem," said Mike Moffatt, founding director of the Missing Middle Initiative.
The condo market is down everywhere — but in Ontario, single-detached home starts have also slumped by 24 per cent, Moffatt noted.
"That should be a wake-up call that something is definitely not going right," he said.
"And 2024 wasn't a great year for Ontario to begin with," he added.
Overall, Canada saw a six per cent decline in housing starts from the first two months in 2024 to 2025. Nova Scotia (16 per cent) and British Columbia (seven per cent) also saw declines. Prince Edward Island saw the largest percentage increase, going from 95 to 259 homes started (173 per cent), while Quebec led the way among the major provinces with a 38 per cent year-over-year housing start increase (from 4,503 to 6,230).
The number of building permits issued to Ontario builders is down as well. The stat can be handy in helping predict what housing starts could look like in a couple of months, Moffatt said. It covers both residential and commercial permits.
Permitting decreased by 13.2 per cent from December to January, according to Statistics Canada. Ontario issued $771 million less worth of permits in that time — the sharpest drop among all provinces and territories. The next-largest decrease was B.C. with $64 million less in permit value.
Permit numbers tend to vary. In December, Ontario led all provinces and territories with $1.1 billion in increased permit value.
But taken together, declines to start 2025 in both housing units started and permits issued are troubling, Moffatt said.
"One data point by itself, probably not a problem," he said. "But when it's coupled with things like CMHC housing starts data, it starts to be a concern."
Development fees charged by cities should be reduced, Moffatt said, noting a March 4 Canadian Home Builders' Association report that singled out Ontario for its high cost barriers to building new homes.
The province should also allow more density as of right, he said.
Some Ontario municipalities, including Vaughan, Burlington and Mississauga, have taken the lead on reducing development charges (DCs).
Moffatt predicted more cuts are on the way as more cities start to realize they're "losing out" on development.
Housing Minister Paul Calandra's press secretary, Emma Testani, said the Ford government "is continuing to move forward with our plan to work with our home building partners on ways we can cut red tape, streamline approvals, and help build the homes our province needs."
