The figure struck me like a cold wind off the Rideau Canal – 3.2 million homes. That’s what Canada needs to build to solve our housing crisis, according to Parliamentary Budget Officer Yves Giroux’s latest bombshell report released yesterday.
I’ve covered housing policy for nearly a decade, but seeing this number quantified so starkly brings home the magnitude of what many Canadians already feel in their daily lives. From Vancouver Island to Cape Breton, families are stretching budgets thinner while dreams of homeownership slip further away.
“We’re beyond the point of incremental solutions,” Giroux told me during a brief phone interview after the report’s release. “Canada faces a structural deficit in housing that affects economic stability, social mobility, and ultimately, our national prosperity.”
The PBO analysis shows the housing shortage has worsened dramatically since 2019, when estimates suggested a 1.8 million unit gap. The near-doubling of this figure reflects both population growth and the failure of construction to keep pace with demand.
Walking through Toronto’s Liberty Village last week, I met Shauna Mackenzie, a nurse who commutes 90 minutes each way to her downtown hospital job. “My parents bought their house for three times my dad’s annual salary,” she said, leaning against the railing of her 450-square-foot rental balcony. “I make a good living, but I’m paying almost 50% of my income for this apartment. How does anyone get ahead?”
Her story isn’t unique. According to Statistics Canada data released alongside the PBO report, approximately 34% of Canadian households now spend more than the recommended 30% of income on housing costs – up from 24% a decade ago.
The regional variations tell an important story too. While Vancouver and Toronto continue to face the most severe affordability challenges, mid-sized cities like Kelowna, Halifax, and London, Ontario have seen some of the steepest percentage increases in housing costs relative to income.
Minister of Housing Sean Fraser acknowledged the severity of the findings at yesterday’s press conference. “This report confirms what Canadians already know – we need to build more homes, faster,” Fraser said. “That’s why our government has committed to eliminating barriers to construction and investing in purpose-built rental housing.”
But opposition critics were quick to point out that the current pace of construction – approximately 250,000 housing starts annually – falls dramatically short of what’s needed to close the gap in any reasonable timeframe.
“At our current rate, it would take nearly 13 years to build the homes we needed yesterday,” said Conservative housing critic Pierre Poilievre during Question Period. “Meanwhile, thousands more newcomers arrive each month needing places to live. The math simply doesn’t work.”
The report identifies several factors contributing to the crisis. Restrictive municipal zoning laws, lengthy approval processes, and skilled labor shortages all constrain new housing development. But the PBO also highlights a less discussed factor: the financialization of housing.
“Approximately 20% of residential properties in major urban centers are now owned by investors rather than occupants,” the report states. “This shifts the market dynamic from homes as places to live toward assets for wealth accumulation.”
For community advocates like Mei Lin Wong of the Housing Rights Coalition, this finding validates what they’ve been saying for years. “We’re not just facing a supply issue,” Wong explained when I called her for comment. “We’re witnessing the consequences of treating housing primarily as an investment vehicle rather than a basic need.”
The report offers several potential paths forward, including federal incentives for municipalities to update zoning laws, targeted tax measures to discourage speculative ownership, and major investments in non-market housing like co-ops and community land trusts.
At Montreal’s McGill University, urban planning professor Robert Dubois suggests we need to think beyond simply building more of the same. “The 3.2 million figure represents not just a quantity issue but a mismatch between what we’re building and what people actually need,” he told me. “We’re constructing luxury condos while families need three-bedroom apartments.”
The timing of this report is particularly significant as Parliament prepares to debate the upcoming federal budget. Sources within the government, speaking on background, indicate that housing will receive “unprecedented attention” in the financial plan expected next month.
For ordinary Canadians like Dev Patel, a software engineer I met at an Ottawa housing forum last month, the solutions can’t come soon enough. “My wife and I earn good salaries, but we’ve been outbid on seven houses,” he said. “Each time, we stretch our budget further, but it’s never enough. We’re thinking about leaving Canada altogether.”
That sentiment reflects a growing concern among economists that the housing crisis threatens Canada’s ability to attract and retain talent. RBC’s latest economic outlook warns that housing affordability has become “a significant competitive disadvantage” for Canadian cities in the global talent marketplace.
As I finished writing this piece, I received a text message from Shauna, the nurse from Liberty Village. “Just got notice my rent is going up another 5.5% in March,” she wrote. “I’m looking at jobs in Calgary now.”
Her message underscores what the PBO report makes clear: Canada’s housing crisis isn’t just about numbers on a page. It’s about the daily reality and future prospects of millions of Canadians whose lives are increasingly shaped by where they can afford to live – or whether they can afford to live here at all.
