Canada’s Housing Gap 2035 – What You Need to Know

The latest report from the Parliamentary Budget Officer (PBO) sheds light on the country’s housing crisis—and the numbers aren’t encouraging. Despite government efforts to slow demand through reduced immigration targets, Canada is still projected to be short nearly 700,000 homes by 2035.

Let’s break it down.

The Numbers Behind the Shortage

• Homes needed (2025–2035): 3.2 million

• Homes expected to be built: 2.5 million

• Gap remaining: 690,000 homes

To close that gap, Canada would need to outperform its all-time construction record every year for the next 11 years straight. For context, 2024 saw the highest number of housing completions on record—276,000 units. Matching or beating that pace until 2035 would be unprecedented.

How Immigration Impacts Housing Demand

Last year, the government reduced its immigration targets:

• Permanent resident targets were cut for 2025 and 2026.

• Fewer international students and temporary residents are permitted.

At the peak in 2024, immigration created 482,000 new households looking for homes. With the new limits, that figure is expected to drop to 176,000 per year until 2030.

While lower immigration reduces demand, it doesn’t erase the housing gap. Canada still needs millions of homes built—and fast.

Ontario’s Troubling Decline in Housing Starts

Canada overall is seeing a strong year in housing starts—over 263,000 as of July. But Ontario, where demand is highest, has seen housing starts fall by almost 70% compared to last year.

This creates a deeper affordability problem in the province where buyers and renters are already stretched the most.

The Government’s Housing Plan

During the last election, Prime Minister Mark Carney pledged to double housing construction and launch a new federal agency, Build Canada Homes, focused on building affordable housing.

But as of today, the agency has not been set up. Housing Infrastructure and Communities Canada says it’s still “refining the approach.” Canadians are left waiting for clear action.

What This Means for Canadians

For anyone looking to buy, sell, or invest, the Canada housing gap 2035 report is clear:

• Affordability challenges aren’t going away anytime soon

• Supply will remain tight, even with immigration cuts

• Homebuyers may face rising competition, especially in high-demand markets like Ontario

The bottom line: Canada needs to build more homes than ever before, and until that happens, prices are unlikely to stabilize in a meaningful way.

Call to Action

If you’re a homeowner or future buyer worried about affordability, you don’t have to wait for government policy to catch up. At Mortgage With Mike, I work hard to help clients find mortgage solutions that work—even in today’s market.

📩 Let’s talk about your options. Reach out today to see how you can make the most of your buying or refinancing strategy. Book a 15-minute call now!