Canada faces a 3.2 million home shortfall as the housing crisis deepens

Posted on September 3, 2025   |  

Canada’s Parliamentary Budget Officer (PBO) says the country needs 3.2 million new homes in 10 years to close the housing gap.

Only 2.5 million homes are expected to be built in that time, leaving a significant shortfall.

Construction will be stronger in the next 3 years, then return to historical averages, with 227,000 homes completed annually.

Household formation is projected to decline as Canada lowers immigration targets.

The PBO expects more construction and reduced demand to ease low vacancy rates and help cool housing prices.