Canadian Housing Starts (October 2025)

Housing starts pull back in October

• Canadian housing starts declined 17% month-on-month (m/m) in October, more than offsetting September's 14% m/m gain. However, starts remained elevated at 232.8k units last month. For context, 210k units was the pre-pandemic run rate for Canadian housing starts. Stripping away monthly volatility, the six-month moving average of starts decreased 3% m/m to 269.0k units.
• In urban markets, October's drop was driven by the multi-family sector, where starts fell by 44.1k (to 169.7k units). Meanwhile, single-detached starts were flat at 41.0k units.
• Last month's decrease in urban starts was broad-based regionally, with activity falling in 7 of 10 provinces:
  • In a reversal of September's narrative, Ontario drove the national drop, as starts plunged by 46.1k to 40.1k units. Elsewhere, starts dipped in B.C. (-1.7k to 32.5k units) and declined, but were still very elevated, in the Prairies (-2.7k to 69.9k units, supported by Alberta). 
  • Starts increased in Quebec (+4.5k to 54.2k units) and in a relative rarity, topped Ontario last month. Starts were also higher in the Atlantic (+1.5k to 14.1k units), driven by Nova Scotia.

Key Implications

• The dip in October housing starts sets the fourth quarter off on a softer footing in terms of residential investment's contribution to real GDP growth. That said, builders are still starting new units at a fairly healthy clip, supported by the purpose-built rental market. Notably, homebuilding in the rest of Canada is much stronger than in Ontario, as the latter is being weighed down by a retrenchment in condo construction.    
• Looking ahead, the softening trend in building permits suggests some further downside for starts in the near-term. This is consistent with our view that homebuilding is likely to cool next year, as modest population growth weighs on rents, and weak pre-sales activity restrains starts in the ownership market.       

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