Latest news with #AledabIorwerth
Global News
10 hours ago
- Business
- Global News
Canada must double home construction over 10 years for affordability: CMHC
Canada's housing agency says home construction in the country will need to double within the next 10 years if affordability levels are to reach what was last seen in 2019. The Canada Mortgage and Housing Corp. (CMHC) said up to 4.8 million new homes will need to be built by 2035, with its latest supply gaps estimate report showing between 430,000 and 480,000 housing units are needed annually — far more than projections by the CMHC of 245,000 starts each year. 'Tackling this housing affordability challenge is enormous, it's absolutely critical to increase housing supply,' said Aled ab Iorwerth, CMHC deputy chief economist. Ab Iorwerth said, during a podcast published by the agency, that doubling the pace of construction was achievable but it would require a 'significantly larger and modernized workforce,' as well as more investment from the private sector, fewer delays and less regulation. Story continues below advertisement Earlier this week, the CMHC said housing starts in May edged down 0.2 per cent compared to April, with 279,510 units. The report, released Thursday, stated that restoring affordability levels that were last seen in 2004 was 'no longer realistic.' That goal was laid out in 2023, when the agency estimated Canada would need to build an added 3.5 million housing units by 2030, in addition to the 2.3 million projected to be built by that year. 1:05 'No wrong places to build housing': Robertson responds to AG report's criticism But the post-COVID-19 surge in housing costs 'changed Canada's affordability landscape,' and challenges being seen in places like Toronto and Vancouver — already ongoing for decades — would take more time to tackle. Get breaking National news For news impacting Canada and around the world, sign up for breaking news alerts delivered directly to you when they happen. Sign up for breaking National newsletter Sign Up By providing your email address, you have read and agree to Global News' Terms and Conditions and Privacy Policy The report includes reassurances that increasing the housing supply is unlikely to cause financial instability as 'these forces take time to produce reactions.' Ab Iowerth added the projections in the report were calculated on a 10-year timeline for that reason. Story continues below advertisement But Ab Iowerth noted if supply is not added, prices will only get worse. 'We have predictions that, without increasing supply, house prices will continue to become more and more affordable,' he said. 'There's that challenge, but there's equally a challenge in the rental system. Rents will continue to rise because of the absence of supply, so if we don't tackle this problem, it will become a bigger and bigger problem that starts to pile up and become worse.' Housing construction was a key issue during the federal election campaign earlier this year, with the Liberals promising to double the rate of residential construction over the next decade to reach 500,000 homes per year. The plan emphasized scaling up prefabricated housing construction. It said a new entity called Build Canada Homes would provide $25 billion in debt financing and $1 billion in equity financing to prefabricated homebuilders to reduce construction times by up to 50 per cent. The CMHC report shows a return to 2019 affordability levels in the next decade would lead to house prices being roughly one-quarter lower than they would be in 2035 as it currently stands, with average rents down by an average of five per cent. Without changes, however, Ab Iowerth warns the issues facing Canadians is unlikely to shift. Story continues below advertisement 'The average person looking to rent or buy a house right now is facing a big challenge: not only is it costly, but even finding a place is hard,' he said. 'We need more housing supply so that people can move to Vancouver and find the work they want or move to Toronto and get the job they want and, in the process, help the Canadian economy.' —with files from The Canadian Press
Calgary Herald
a day ago
- Business
- Calgary Herald
Calgary needs 45 per cent more housing annually: CMHC
Despite a surge in housing construction in the past few years, Calgary needs to increase its annual production by more than 45 per cent to reverse the city's affordability woes ushered in by COVID-19, according to a new report by the Canada Mortgage and Housing Corporation. Article content The finding is part of a broader examination of the real estate landscape in Canada, which also concludes the country will need to double its housing starts to bring its levels of affordability down to those of 2019. That means an addition of between 430,000 to 480,000 homes. Article content Article content Article content House prices, an important indicator of affordability, have steadily increased in the past few years. In Calgary, the average annual growth in prices between 2004 and 2019 was 4.3 per cent. The average rate between 2019 and 2024 grew to 7.3 per cent, making it harder for average Calgarians to afford a home in the city. Article content Article content The organization deems a housing unit affordable when its owner or renter is paying 30 per cent or less of their gross income towards shelter costs. Homeowners in Calgary, on average, paid 38 per cent of their gross income to housing expenses between 2019 and 2024, a sharp rise from 27 per cent 15 years before. Article content Rent prices, meanwhile, have more than doubled in those time periods, rising from 3.4 per cent between 2004 and 2019 to 7.9 per cent in the last five years. Article content Comparing CMHC's data on home prices and rent is complicated by the fact the organization calculates rent growth based on rates at most purpose-built rental units and not just those available for new tenants at the current market price. Article content Article content Although CMHC says it has started to report on rents when units are turned over to new tenants, reflecting market transactions, 'these are insufficient for modelling.' Article content Article content 'The loss of affordability over the past (two) decades has been large and is becoming larger,' the report stated. Article content Aled ab Iorwerth, deputy chief economist for CMHC, ascribes this problem to the pandemic, when people in cities, mainly Toronto and Vancouver, grew tired of housing costs and long commutes, and eventually moved to other cities. This was made possible by the option to work remotely. Article content As a result, demand rose in other parts of the country, as did prices. However, living costs didn't get any cheaper in Toronto and Vancouver, where demand for housing continued to rise with a higher population. Article content 'You're still seeing population growth and income growth in those cities, so it's just that they still have positive population and income growth, albeit slower than in Alberta,' he added.
Hamilton Spectator
a day ago
- Business
- Hamilton Spectator
Home construction must double over next decade to restore 2019 affordability: CMHC
Canada Mortgage and Housing Corp. says up to 4.8 million new homes will need to be built over the next decade to restore affordability levels last seen in 2019 based on projected demand. The national housing agency released its latest supply gaps estimate report on Thursday, which said between 430,000 and 480,000 new housing units are needed per year across the ownership and rental markets by 2035. That would represent around double the current pace of home construction in Canada. A total of 90,760 housing starts have been recorded so far this year through May, and CMHC projects an average of 245,000 starts annually over the next 10 years under current conditions. CMHC deputy chief economist Aled ab Iorwerth said doubling the pace of housing construction in Canada is achievable, 'but not without a significantly larger and modernized workforce, more private investment, less regulation, fewer delays, and lower development costs.' He also called for more innovation in construction technology and growth in labour productivity. 'As we increase housing over time, house price growth will come down,' ab Iorwerth said on a call with media prior to the report's release. The report reassured that increasing housing supply is 'unlikely to cause financial instability because these forces take time to produce reactions.' Ab Iorwerth added the projections were calculated on a 10-year timeline for that reason. 'We're hoping that this will be a gradual transition,' he said. 'Housing supply will be increasing. This will start to slow the growth in house prices. Canadians will then be a little bit less keen to bid aggressively on housing ... and they'll diversify their savings into other money markets or the stock exchange or whatever. And so the pressure will be taken out of house prices.' In 2023, the agency estimated Canada would need to build an additional 3.5 million housing units by 2030, on top of 2.3 million that were already projected to be built by that year, to reach affordability levels seen in 2004. In its latest report, CMHC said that timeline 'is no longer realistic,' especially after the post-pandemic price surge seen across the housing market. Ab Iorwerth said Canada has faced a 'shock' to housing affordability since 2019. 'When we were looking at the data, we saw that there's been a lot of loss of affordability since 2019,' he said. 'We've seen these very fundamental changes in the housing system since 2019. It's what the pandemic led to, these structural changes that we're seeing in the housing system ... and that's why we've decided to look at 2019 as this aspiration to really try and address this challenge that most Canadians are now feeling.' The agency defines affordability as the amount of income that goes toward housing. In general, it aims to return to levels of affordability at which adjusted house prices are no higher than 30 per cent of average gross household income. But that ratio is projected to reach 52.7 per cent by 2035 in a 'business-as-usual' scenario, up from 40.3 per cent in 2019. Doubling projected housing starts over the next decade would bring the figure down to 41.1 per cent of income being allocated for homebuying nationally, according to the agency. During the federal election campaign, the Liberals promised to double the rate of residential construction over the next decade to reach 500,000 homes per year. The plan emphasized scaling up prefabricated housing construction. It said a new entity called Build Canada Homes would provide $25 billion in debt financing and $1 billion in equity financing to prefabricated homebuilders to reduce construction times by up to 50 per cent. Returning to 2019 affordability levels in the next decade would lead to house prices being roughly one-quarter lower than where they would otherwise be in 2035, the CMHC's report added. Average rents would also be about five per cent lower. The report included regional breakdowns, which show Ontario, Nova Scotia and B.C. have the most significant housing supply gaps by province. Montreal faces the largest gap of any major city, where home ownership costs have also risen faster than other regions in recent years, followed by Ottawa, where CMHC said new supply has not kept pace with increased housing demand. In Toronto, despite increased rental construction in recent years, the region is lacking home ownership options that match local incomes, and CMHC estimated a 70 per cent increase in homebuilding over the next decade would help to improve affordability issues. For Vancouver, it said an estimated 7,200 additional homes are needed annually above the 'business-as-usual' scenario, an increase of 29 per cent. It estimated Calgary, which has seen record levels of home construction for three straight years, will need 45 per cent more new homes annually. Meanwhile, no additional supply is required beyond what is currently projected in Edmonton, as sufficient market housing is expected to be built in the region to maintain affordability by 2035. This report by The Canadian Press was first published June 19, 2025.
CTV News
a day ago
- Business
- CTV News
Home construction must double over next decade to restore 2019 affordability: CMHC
Cranes are seen above a condo development and other housing projects under construction, in Coquitlam, B.C., on Tuesday, May 16, 2023. THE CANADIAN PRESS/Darryl Dyck Canada Mortgage and Housing Corp. says up to 4.8 million new homes will need to be built over the next decade to restore affordability levels last seen in 2019 based on projected demand. The national housing agency released its latest supply gaps estimate report on Thursday, which said between 430,000 and 480,000 new housing units are needed per year across the ownership and rental markets by 2035. That would represent around double the current pace of home construction in Canada. A total of 90,760 housing starts have been recorded so far this year through May, and CMHC projects an average of 245,000 starts annually over the next 10 years under current conditions. 'Doubling the pace of housing construction in Canada is achievable, but not without a significantly larger and modernized workforce, more private investment, less regulation, fewer delays, and lower development costs,' said CMHC deputy chief economist Aled ab Iorwerth in a press release. 'It will also require significant innovation in construction technology and growth in labour productivity.' In 2023, the agency estimated Canada would need to build an additional 3.5 million housing units by 2030, on top of 2.3 million that were already projected to be built by that year, to reach affordability levels seen in 2004. In its latest report, CMHC said that timeline 'is no longer realistic,' especially after the post-pandemic price surge seen across the housing market. 'COVID-19 significantly changed the affordability landscape across the country,' the report said. 'As a result, we're changing our aspiration to restoring affordability to levels seen just before the pandemic. This change also highlights how widespread the housing affordability challenge has become across Canada.' The agency defines affordability as the amount of income that goes toward housing. In general, it aims to return to levels of affordability at which adjusted house prices are no higher than 30 per cent of average gross household income. But that ratio is projected to reach 52.7 per cent by 2035 in a 'business-as-usual' scenario, up from 40.3 per cent in 2019. Doubling projected housing starts over the next decade would bring the figure down to 41.1 per cent of income being allocated for homebuying nationally, according to the agency. During the federal election campaign, the Liberals promised to double the rate of residential construction over the next decade to reach 500,000 homes per year. The plan emphasized scaling up prefabricated housing construction. It said a new entity called Build Canada Homes would provide $25 billion in debt financing and $1 billion in equity financing to prefabricated homebuilders to reduce construction times by up to 50 per cent. Returning to 2019 affordability levels in the next decade would lead to house prices being roughly one-quarter lower than where they would otherwise be in 2035, the CMHC's report added. Average rents would also be about five per cent lower. The report included regional breakdowns, which show Ontario, Nova Scotia and B.C. have the most significant housing supply gaps by province. Montreal faces the largest gap of any major city, where home ownership costs have also risen faster than other regions in recent years, followed by Ottawa, where CMHC said new supply has not kept pace with increased housing demand. In Toronto, despite increased rental construction in recent years, the region is lacking home ownership options that match local incomes, and CMHC estimated a 70 per cent increase in homebuilding over the next decade would help to improve affordability issues. For Vancouver, it said an estimated 7,200 additional homes are needed annually above the 'business-as-usual' scenario, an increase of 29 per cent. It estimated Calgary, which has seen record levels of home construction for three straight years, will need 45 per cent more new homes annually. Meanwhile, no additional supply is required beyond what is currently projected in Edmonton, as sufficient market housing is expected to be built in the region to maintain affordability by 2035. --- Sammy Hudes, The Canadian Press This report by The Canadian Press was first published June 19, 2025.
Toronto Sun
a day ago
- Business
- Toronto Sun
Home construction must double over decade to restore 2019 affordability: CMHC
Published Jun 19, 2025 • 3 minute read New home construction. Photo by Brent Calver / Postmedia Network Canada Mortgage and Housing Corp. says up to 4.8 million new homes will need to be built over the next decade to restore affordability levels last seen in 2019 based on projected demand. This advertisement has not loaded yet, but your article continues below. THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLY Subscribe now to read the latest news in your city and across Canada. Unlimited online access to articles from across Canada with one account. Get exclusive access to the Toronto Sun ePaper, an electronic replica of the print edition that you can share, download and comment on. Enjoy insights and behind-the-scenes analysis from our award-winning journalists. Support local journalists and the next generation of journalists. Daily puzzles including the New York Times Crossword. SUBSCRIBE TO UNLOCK MORE ARTICLES Subscribe now to read the latest news in your city and across Canada. Unlimited online access to articles from across Canada with one account. Get exclusive access to the Toronto Sun ePaper, an electronic replica of the print edition that you can share, download and comment on. Enjoy insights and behind-the-scenes analysis from our award-winning journalists. Support local journalists and the next generation of journalists. Daily puzzles including the New York Times Crossword. REGISTER / SIGN IN TO UNLOCK MORE ARTICLES Create an account or sign in to continue with your reading experience. Access articles from across Canada with one account. Share your thoughts and join the conversation in the comments. Enjoy additional articles per month. Get email updates from your favourite authors. THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK. Create an account or sign in to continue with your reading experience. Access articles from across Canada with one account Share your thoughts and join the conversation in the comments Enjoy additional articles per month Get email updates from your favourite authors Don't have an account? Create Account The national housing agency released its latest supply gaps estimate report on Thursday, which said between 430,000 and 480,000 new housing units are needed per year across the ownership and rental markets by 2035. That would represent around double the current pace of home construction in Canada. A total of 90,760 housing starts have been recorded so far this year through May, and CMHC projects an average of 245,000 starts annually over the next 10 years under current conditions. 'Doubling the pace of housing construction in Canada is achievable, but not without a significantly larger and modernized workforce, more private investment, less regulation, fewer delays, and lower development costs,' said CMHC deputy chief economist Aled ab Iorwerth in a press release. Your noon-hour look at what's happening in Toronto and beyond. By signing up you consent to receive the above newsletter from Postmedia Network Inc. Please try again This advertisement has not loaded yet, but your article continues below. 'It will also require significant innovation in construction technology and growth in labour productivity.' In 2023, the agency estimated Canada would need to build an additional 3.5 million housing units by 2030, on top of 2.3 million that were already projected to be built by that year, to reach affordability levels seen in 2004. In its latest report, CMHC said that timeline 'is no longer realistic,' especially after the post-pandemic price surge seen across the housing market. 'COVID-19 significantly changed the affordability landscape across the country,' the report said. 'As a result, we're changing our aspiration to restoring affordability to levels seen just before the pandemic. This change also highlights how widespread the housing affordability challenge has become across Canada.' This advertisement has not loaded yet, but your article continues below. The agency defines affordability as the amount of income that goes toward housing. In general, it aims to return to levels of affordability at which adjusted house prices are no higher than 30 per cent of average gross household income. But that ratio is projected to reach 52.7 per cent by 2035 in a 'business-as-usual' scenario, up from 40.3 per cent in 2019. Doubling projected housing starts over the next decade would bring the figure down to 41.1 per cent of income being allocated for homebuying nationally, according to the agency. During the federal election campaign, the Liberals promised to double the rate of residential construction over the next decade to reach 500,000 homes per year. The plan emphasized scaling up prefabricated housing construction. It said a new entity called Build Canada Homes would provide $25 billion in debt financing and $1 billion in equity financing to prefabricated homebuilders to reduce construction times by up to 50 per cent. This advertisement has not loaded yet, but your article continues below. Returning to 2019 affordability levels in the next decade would lead to house prices being roughly one-quarter lower than where they would otherwise be in 2035, the CMHC's report added. Average rents would also be about five per cent lower. The report included regional breakdowns, which show Ontario, Nova Scotia and B.C. have the most significant housing supply gaps by province. Montreal faces the largest gap of any major city, where home ownership costs have also risen faster than other regions in recent years, followed by Ottawa, where CMHC said new supply has not kept pace with increased housing demand. In Toronto, despite increased rental construction in recent years, the region is lacking home ownership options that match local incomes, and CMHC estimated a 70 per cent increase in homebuilding over the next decade would help to improve affordability issues. This advertisement has not loaded yet, but your article continues below. For Vancouver, it said an estimated 7,200 additional homes are needed annually above the 'business-as-usual' scenario, an increase of 29 per cent. It estimated Calgary, which has seen record levels of home construction for three straight years, will need 45 per cent more new homes annually. Meanwhile, no additional supply is required beyond what is currently projected in Edmonton, as sufficient market housing is expected to be built in the region to maintain affordability by 2035. Read More NHL Editorial Cartoons Basketball Soccer NHL
