Rising development costs and weaker buyer demand continued to keep new project launches under pressure
Canada's homebuilding sector retreated in July, with actual monthly housing starts falling 19% year-over-year in urban centres. Rising development costs and weaker buyer demand continued to keep new project launches under pressure.
Canada Mortgage and Housing Corporation (CMHC) recorded 18,834 actual starts in centres with a population of 10,000 or more during the month. That's down from 23,155 units in July 2025.
The year-to-date total stood at 131,851 units, off 4% from the same period last year, extending a losing streak that has defined Canada's 2026 construction landscape.
The total monthly seasonally adjusted annual rate (SAAR) for all areas in Canada fell 5% in July to 229,074 units, from 240,773 in June.
The six-month trend, a moving average used to smooth monthly swings, edged down 0.5% to 247,377 units, roughly in line with CMHC's February 2026 Housing Market Outlook, which projected 247,000 annual starts for the year.
Read more: CMHC cuts housing forecast as sales and prices set to slide
An analysis from Royal Bank of Canada suggests Canada's housing market recovery remains uneven, while Sarah Albert of Premiere Mortgage Centre reports renewed buyer activity and strong demand for quality listings in New Brunswick.https://t.co/7F9YgjkiCI
— Canadian Mortgage Professional Magazine (@CMPmagazine) August 13, 2026
Vancouver slumps 42% as regional divergence deepens
Canada's three biggest markets delivered divergent results. Montréal posted a 3% year-over-year gain in actual starts, supported by multi-unit construction.
Toronto fell 10% on lower multi-unit volumes. Vancouver recorded a 42% plunge across both multi-unit and single-detached segments, a steeper retreat than the 35% drop seen in June, when Canada's housing starts extended their slide as builders continued to pull back.
The pipeline data told a more complex story. Units under construction in centres of 50,000 or more edged up just 0.6% month-over-month to 373,091, while completions rose 8.1% to 19,773 units, evidence that work already in progress is advancing.
Yet units with approved permits but not yet started climbed 3% to 141,480, a figure brokers and developers are watching for signals on whether delayed launches will eventually convert.
Tania Bourassa-Ochoa, Deputy Chief Economist at CMHC in Ottawa, said the result tracked the agency's expectations.
"Although the pipeline of homes under construction remains substantial and completions are increasing, fewer new projects are being started in many markets, notably in Vancouver, Calgary and Toronto," she said.
"Based on the recent slowdown in activity, housing starts are likely to remain subdued over the coming months."
Brokers navigate a fragmented and volatile market
For mortgage professionals, the latest data lands in an environment that has grown increasingly difficult to read at the regional level, a theme that was already apparent when the near-flat national trend recorded in May 2026 masked sharp local contrasts.
Elan Weintraub, a Toronto-based mortgage broker at Mortgage Outlet, told Canadian Mortgage Professional in a recent interview that conditions were hard to generalise.
"I think real estate is very cloudy and volatile," he said. "It's extremely micro-fragmented. Certain pockets might be lukewarm to hot. Other pockets are ice cold."
Make sure to get all the latest news to your inbox on Canada’s mortgage and housing markets by signing up for our free daily newsletter here.
