Canada’s housing construction trend held largely steady in May, even as new starts declined on a monthly basis and forward-looking indicators pointed to softer momentum, according to new data from Canada Mortgage and Housing Corporation.
The national housing starts trend, measured as a six-month moving average, edged up 0.5 per cent to an annualized rate of 258,010 units in May, CMHC said Monday. The modest increase came amid a broader set of mixed indicators across the housing construction sector.
The data suggest an uneven pace of activity in residential building, with gains in some areas offset by declines in others, and potential implications for the pace of future housing supply.
Actual housing starts in centres with populations of at least 10,000 totalled 22,633 units in May, down 5.2 per cent from 23,879 units in the same month last year. Despite the decline, year-to-date starts reached 93,644 units, up three per cent compared with the same period in 2025. The increase was driven by stronger activity in British Columbia and Ontario, which more than offset decreases in the Prairie provinces.
On a seasonally adjusted annualized basis, total housing starts across all areas fell six per cent in May to 261,377 units, compared with 278,380 units in April.
Meanwhile, construction activity already underway continued to climb. The number of units under construction in centres with populations of 50,000 or more rose 0.9 per cent month-over-month to 374,662 units.
Completions also increased, rising 10.6 per cent from April to 16,880 units in May.
However, the pipeline of future projects showed some contraction. The number of units with approved building permits that had not yet started construction declined 2.4 per cent from the previous month to 138,842 units.
Aled Ab Iorwerth, deputy chief economist at CMHC, said the combined data points reflect a housing sector that is not moving in a single direction.
Aled ab Iorwerth, Deputy Chief Economist at CMHC (CNW Group/Canada Mortgage and Housing Corporation (CMHC))
“May’s data showed mixed results. Year-to-date housing starts are slightly up from last year, and the monthly starts trend was basically flat, while units under construction and completions increased. Overall, these results suggest that construction activity is uneven and taken together with the decline of approved units not yet started and market intelligence point to weaker momentum for future supply,” he said.
Regionally, Canada’s largest urban markets posted varied results.
Montreal recorded an 18 per cent year-over-year increase in actual housing starts in May, driven by gains in multi-unit construction. In contrast, Vancouver saw a seven per cent decrease, also tied to lower multi-unit activity, while Toronto posted a 12 per cent decline in starts.
Outside urban centres, the seasonally adjusted annual rate estimate for rural housing starts stood at 14,357 units in May.
CMHC said its trend measure is used to smooth out volatility in monthly housing data, particularly because multi-unit construction can cause significant fluctuations from one month to the next. The agency uses the measure alongside the monthly seasonally adjusted annual rate to provide a clearer view of housing supply conditions.
Housing starts data are released on the eleventh business day of each month. CMHC said it will publish its June figures on July 16.
Mario Toneguzzi
Mario Toneguzzi is Managing Editor of Canada’s Entrepreneur. He has more than 40 years of experience as a daily newspaper writer, columnist, and editor. He was named in 2021 and 2024 as one of the top business journalists in the world by PR News. He was also named by RETHINK to its global list of Top Retail Experts 2024, 2025 and 2026.
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