A new report from the Canada Mortgage and Housing Corporation (CMHC) found that Canadian home prices have climbed faster than in most peer countries. The CMHC found this was largely because housing supply has not kept pace with demand. Near the onset of the COVID-19 pandemic, population growth and low interest rates boosted demand, which, combined with low supply, sent home prices soaring.

CMHC reported that, Canadian house prices rose by 101% between 2005 and 2025, after inflation. That compares to 30% in the US and 13% in the UK.
Canada skipped the post-crisis reset. US and UK house prices fell sharply during the 2008 financial crisis. Canadian house prices barely paused and kept rising
through 2022. Prices have since eased about 17%, after inflation, but remain roughly double their 2005 level.
Population growth outran building activity. Canada's population grew by 29% over those 20 years, while rising incomes and low
borrowing costs added to demand. The gap peaked in 2023 and 2024 at nearly five new residents for every home completed, before easing to about 1.5 in 2025.
Canada has fewer homes per person. There are 426 homes for every 1,000 Canadians, below the Organisation for Economic Co-operation and Development (OECD) average of 468. CMHC says larger housing stocks in countries such as Sweden and Norway may have helped moderate their price increases.
Homebuilding in Canada has been steady but not strong enough. New homes increased Canada's housing stock by about 1.3% in 2022, above the OECD average of 1.2%.

CMHC's findings suggest high prices reflect years of demand outpacing supply. Building more homes at a faster pace is likely to be central to improving affordability over time. Affordability concerns persist, despite the recent pullback in prices.

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