BC home sales drop below march’s 10‑year average, deepening Canada’s housing slowdown
Canadian housing is flashing warning signs from permits to prices, as construction momentum fades and resale forecasts weaken into 2026.
According to Canada Mortgage and Housing Corporation (CMHC), the six‑month trend in housing starts fell 2.9 percent in March to 248,378 units, while the total monthly seasonally adjusted annual rate (SAAR) slipped 6 percent to 235,852 units from 250,961 units in February.
CMHC says this points to a “continued loss of momentum in housing construction,” even though actual housing starts in centres with populations of 10,000 or more rose 10 percent year‑over‑year in March, to 16,398 units from 14,935 in March 2025.
Year‑to‑date, CMHC reports 49,206 starts, up 9 percent from the same period in 2025, driven by British Columbia, Ontario, and Quebec.
As reported by The Canadian Press, CMHC chief economist Mathieu Laberge says the March data show a continued loss of momentum in housing construction that aligns with the agency’s housing market outlook.
In his words, “actual starts increased compared to a year ago” mainly because activity was “exceptionally low” in the first quarter of last year.
In its new analysis “Canada’s Construction Pulse: Permits Lead, Starts Confirm,” CMHC says building permits now provide the earliest broad signal of housing market sentiment, while housing starts confirm the level of construction in progress and expected supply.
The agency says that in a market dominated by large, multi‑year developments, building permits are a good gauge of current sentiment and future housing construction.
For major Canadian cities, it says permits now point to “further decline in housing construction for 2026 and beyond.”
CMHC highlights a structural shift in the market: until 2012, single‑detached houses dominated, from 2012 to 2025 condominiums made up most housing starts, and since last year purpose‑built rental apartments have become the largest single category.
CMHC argues that this shift makes permits a better indicator of current market conditions, while starts now serve mainly as a gauge of construction activity and upcoming completions.
Mid‑ to high‑rise condo and rental projects in large urban centres show a longer delay between building permits and housing starts – roughly 9 to 15 months – compared with about 2 to 10 months for single‑detached homes, and this delay has lengthened over time.
CMHC says this reflects a greater share of high‑rise buildings that require heavier foundational work, including podiums and underground parkades, while factors such as labour shortages, regulation, economic conditions and market sentiment can also prompt developers to pause projects.
CMHC also stresses that the composition of housing starts varies widely by city.
It says more than half of starts in Toronto and Montréal are high‑ or mid‑rise, while Calgary remains dominated by single‑detached, “gentle density” and low‑rise structures.
Focusing on apartments, CMHC finds that building permits generally lead starts by 6 to 15 months and reports that figures for four major cities and their census metropolitan areas show a loss of momentum across markets, with permits slowing or stabilizing even where starts still show momentum.
CMHC concludes that a thorough look at permit and start trends reveals “softness in housing markets across the country – sentiment is trending down and so should building activity in the near future.”
