Ontario Housing Starts Plunge, Job Losses Mount Amid Regulatory Burden
Event summary
- Housing starts in 34 Ontario municipalities decreased significantly in 2025, with condo apartment starts down 52% and ground-oriented housing down 43% compared to 2021-24 averages.
- The residential construction industry experienced 46,562 fewer person-years of employment compared to the 2021-24 averages.
- 17 of the 34 municipalities studied received an ‘F’ grade for housing performance, largely unchanged from the previous report in December 2025.
- Development charges have reportedly increased over 5,000% in some municipalities over the past 25 years, cited as a primary driver of declining home sales.
The big picture
The RESCON report highlights a deepening crisis in Ontario’s residential construction sector, extending beyond the condo market and impacting broader employment. The findings underscore the significant impact of regulatory burdens and development charges on housing affordability and construction activity. This slowdown poses a risk to Canada’s overall economic growth, particularly given the current global economic slowdown.
What we're watching
- Policy Impact
- The effectiveness of recent federal-provincial agreements to eliminate sales taxes and cut development charges remains uncertain, and implementation delays could further depress the market.
- Regional Divergence
- While the Toronto area has borne the brunt of job losses, the worsening employment situation in other regions of Ontario suggests a broader systemic issue beyond a localized downturn.
- Builder Response
- How residential builders adapt to the ongoing cost pressures and reduced demand will dictate the pace of recovery and potential for innovation within the sector.
