Canadian Housing Starts (September 2025)

Housing starts rise in September

• Canadian housing starts increased 14% month-on-month (m/m) in September to an elevated 279.2k units, almost fully bouncing back from the 17% m/m drop in August. Stripping away monthly volatility, the six-month moving average of starts increased 4.1% m/m to 277.1k units.
• In urban markets, September's gain was driven by the multi-family sector, where starts jumped by 34.0k (to 213.3k units). Meanwhile, single-detached starts edged higher by 1.0k to 41.0k units.
• Last month's increase in urban starts was relatively broad-based regionally, with activity up in 6 of 10 provinces: 
  
  • Ontario drove the national gain, as starts increased by 31.6k to 85.8k units. Starts also picked up in Quebec (+3.4k to 49.2k units) and the Prairies (+13.4k to an elevated 72.5k units), lifted by Alberta. 
  • In contrast, starts dropped in B.C. (-9.4k to 34.2k units), and the Atlantic (-4.1k to 12.7k units) amid broad-based drops in the latter (with the exception of Newfoundland and Labrador).

Key Implications

• Builders continue to break ground on new homes at a very healthy pace, with starts rising last month and remaining elevated. However, over the past two months, they've cooled a bit (on average) from the ultra-robust rate observed earlier in the year (that was supported by rental units). And, they were down 3% quarter-on-quarter in Q3, about in line with what we'd expected. This will weigh on growth in the residential investment component of GDP. 
• Peering ahead, the downward trend in building permits could signal some further moderation in the near-term. We also expect some easing in Canadian homebuilding next year amid dropping rents and weak population growth. What's more, past declines in pre-construction home sales should keep a lid on homebuilding in the ownership market.       

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