RESCON Housing Summit hears affordability is improving but supply gap remains
By Mike Lewis
Ontario Construction News
Oct. 1, 2026
Tax cuts and building code changes along with sluggish buyer demand have helped make resale homes more affordable in regions including the GTA. But policy reforms lack the speed and scale needed to close the massive gap in housing supply, a summit focused on Ontario’s residential market has been told.
“Is housing reform working?” asked Ian Lee, an associate professor at Carleton University’s Sprott School of Business in Ottawa. “I’m going to give a qualified yes and a qualified no,” he said during the sixth annual online Housing Summit hosted by the Residential Construction Council of Ontario (RESCON). “It is sort of working. We’re going in the right direction, but we’ve got to do more.”
Ana Bailão, one year into her role as CEO of federal housing agency Build Canada Homes, told the audience of builders, policy makers and the public that the housing market is showing “steady progress against significant headwinds.”
Speakers at the summit, titled Housing Reform: Is It Working? applauded reductions in the municipal development charges used to fund housing-enabling infrastructure — coupled with moves by Ontario and the federal government to provide temporary tax relief and rebates that effectively remove the full 13 per cent Harmonized Sales Tax on new or renovated homes valued up to $1 million.
Still, and despite what Marlon Bray, executive vice-president of Mississauga-based Clark Construction Management Inc. called $82 billion in government spending on housing and 31 housing bills in recent years, housing supply continues to struggle to meet demand. And the resale market remains weak due to what speakers called the new normal of economic uncertainty.
The Canada Mortgage and Housing Corporation in a recent report said the seasonally adjusted annualized rate of national housing starts stood flat at 229,046 units in August, following a 4.9 per cent decline in July.
Starts are down four per cent year-over-year, reflecting a broader cooling trend across the residential construction sector, the report said.
Homebuilding is trending lower in Ontario and British Columbia on financing costs and poor pre-construction condominium sales. The Prairies, Quebec, and Atlantic regions show relative strength, often supported by rental properties.
The federal agency estimates that between 400,000 and 470,000 new homes annually will be needed to improve affordability and eliminate the accumulated shortfall of supply. That’s far more than Canada’s current pace of roughly 250,000 yearly starts.
To accelerate homebuilding, temporary tax and fee cuts should be made permanent, RESCON officials say, the approvals process must be modernized, building codes updated and more efficient construction methods adopted faster.
“Recent government measures have provided some much-needed help, but modest progress is not the same as success,” RESCON president Richard Lyall said in a statement. “Housing construction continues to fall far short of what is needed to restore affordability and meet future demand.
“The reality is that we remain far from solving the housing crisis.” He said the tax burden on housing remains too high and the approvals system is still cumbersome and lengthy.
And while efforts to boost construction have had an uneven impact, lower tax and development charges make housing more affordable in the Toronto area, said Jason Mercer, chief market analyst at the Toronto Regional Real Estate Board.
He told the summit that the annual income needed to buy the average GTA home has dropped to $140,000 to $150,000 thanks to price declines from more than $200,000 at the height of the interest rate tightening cycle in 2024 when the central bank’s benchmark rate hit 5 per cent.
He said with the share of income devoted to mortgage payments in the GTA falling to less than 30 per cent from 50 per cent in 2022, “we should be seeing more sales.
“We haven’t seen that many people move off the sidelines,” Mercer added due to factors including concerns about the impact of U.S. tariffs which are threatening jobs and inflating the cost of building new homes on both sides of the border.
“Unpredictability is now the thing people are trying to figure out,” David Coletto, founder and CEO of Abacus Data, said during his summit presentation. “It’s a feeling that the floor beneath you is constantly moving.”
He said this “precarity” mindset is partly due to Donald Trump and his administration, which has moved into a solid second spot among issues facing the country, after the rising cost of living, according to the national polling firm’s data.
Coletto also said housing markets continue to collide with different generational views. He said the public, especially those under 40, express frustration with a lack of progress in addressing housing challenges and are fearful that house prices could collapse. He cited an Abacus survey this year that found 79 per cent of respondents believe the housing system in Canada isn’t working as it should, with 74 per cent saying not enough homes of all kinds are being built.
Daniel Foch, chief real estate officer at Vaughan-based Valery Real Estate Inc., said young people frozen out of housing markets because of soaring prices particularly in Toronto and Vancouver have turned to stocks and other investments to acquire a portfolio that allows them to eventually buy real estate.
Millennials and Gen Xers “are figuring out new ways to build wealth in the interim,” he told the summit.