Canada Is Now Building 2 Homes Per Person Added To the Population

Canada’s home builders kicked off roughly 47,300 new homes in the first quarter of 2025. That is about 10 percent fewer than the same time last year and the slowest quarterly pace since early 2023—8.6 percent below the five-year average before 2020. At first glance, the slowdown in construction might set off alarm bells.

But population growth during the same period was extremely low. Canada added just about 22,100 people in Q1 2025—barely a blip in the national population of 41 million. In effect, population growth was almost flat, so even a smaller number of homes under construction still matched or exceeded the number of new residents.

That meant that builders began construction on roughly 2.35 homes for every person added to Canada’s population during the quarter. In the previous quarter (Q4 2024), the ratio was nearly 1.02 homes per person. So the change in ratio marks a sharp shift and a notable dip in Canada’s long-accumulated housing deficit.

If that pace continues, Canada is on track to hit its lowest average household size ever recorded by next year. The average household size has hovered at 2.5 people per home in recent decades—now it is poised to fall to a new record low. Smaller households mean more homes required per person added.

Still, public officials, including Canada’s state-owned mortgage insurer, warn that even this improved pace might not be enough. They argue that housing construction would need to triple to meet affordability goals and return to 2019 levels by 2035. That would require building about six homes for every person added—well above the current rate.

Some experts say that simply adding supply does not guarantee lower prices. The costs of land, labor, building materials and regulatory red tape still drive prices up. And even with rising vacancy rates in places like Toronto, home prices have only fallen modestly—suggesting that higher supply has not translated into affordability just yet. The coming months will be key. If population growth stays low and construction holds steady at more than two new homes per person, Canada may finally close part of its housing gap. But to reverse high home prices and improve affordability will require more than construction—it will require cost controls, policy reforms and a balanced approach to demand and supply.