CMHC releases 2025 Housing Market Outlook
According to CMHC’s 2025 Housing Marketing Outlook, apartment construction is expected to continue the momentum achieved in 2024 through 2025 – 2026. Purpose-built rental construction reached record levels in 2024 due to government support, the growing renter population, and strong rent growth at the time of planning. The projected growth is supported by the number of projects set to start in 2025 and 2026. However, softening rental market conditions may lead to fewer rental projects starting in 2027.
Rental supply has grown faster than new demand since 2024, and yet affordability is still an issue. Lower immigration levels and more first-time homebuyers should reduce rental demand through 2025 to 2027. Supply will increase as new rental units come onto the market, which should mean higher vacancy rates and fewer rent increases. Rental affordability should take longer to improve, as vacated units will adjust to market rents and renters' incomes will grow to match previous market rent increases. At the same time, more affordable rental options will become available as higher-income tenants move to higher-priced new units.
Figure 1: Canada’s new construction slows but maintains historic strength Housing starts by dwelling type