Canada is in the midst of a housing affordability crisis. The essence of the problem is a basic economic reality. When supply does not keep up with demand, prices rise, and on the supply side, Canada is falling short. TD Economics warns the country could be short more than 300,000 homes between 2024 and 2026, even as developers navigate a process that can take at least 22 months to get a project completed.
This problem didn’t start last year, or even in the last decade. The basic problem of housing supply failing to keep pace with population growth has been building for generations. The gap emerged in the late 1970s, widened through the 1980s, spiked in the mid-1990s, flared again after the 2008–09 recession, and peaked in the last few years as permanent and temporary immigration skyrocketed.
What makes today’s crunch so maddening is that it was foreseeable. By the mid-2010s, warnings were already clear, yet policy responses remained timid, and the rules governing what can be built barely budged. As late as 2022, large shares of residential land in major cities were still reserved for single-detached housing: 64 percent in Vancouver, 62 percent in Calgary, and 54 percent in Toronto.
And while Canadians argue about individual culprits, the real story is a stack of costs and constraints that quietly compounded: rising municipal development charges, rezoning timelines that stretch for months or years, fees that add tens of thousands per unit, tax thresholds that lag far behind local prices, and building rules that can make “missing middle” housing uneconomic.
This DeepDive provides an empirical assessment of how unaffordable homeownership has become across Canadian municipalities, along with clear-headed solutions that can deliver real affordability gains for Canadian families.
Bottom line: for families in Vancouver today saving up to 25 percent of their monthly income (which is much higher than the average household savings rate), it takes the average household nearly 18 years, or 217 months, to have a down payment with a mortgage that is less than 60 percent of their take-home pay. In Toronto, it takes approximately 17 years, or 203 months.
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