The rent-to-own model for Canadian real estate investors has emerged as a structured alternative to traditional acquisition strategies as affordability constraints reshape market participation. This approach bridges rental income generation with eventual property transfer, creating pathways for investors to engage tenant-buyers who lack immediate financing access while building equity positions over extended timelines.

As housing costs outpace wage growth and mortgage qualification criteria remain stringent, rent-to-own structures address a specific market gap. Investors generate returns through option fees, premium rental rates, and appreciation potential while deferring full sale execution — a model gaining relevance as market conditions drive demand for alternative ownership pathways.

Structural Mechanics and Legal Framework

The rent-to-own model for Canadian real estate investors operates through legally distinct agreements combining rental occupancy with purchase optionality. These arrangements involve two primary components: a standard residential lease and either an option-to-purchase or lease-purchase agreement establishing terms for eventual property transfer.

Under option-to-purchase structures, tenant-buyers pay non-refundable option fees — typically three to five percent of the agreed future purchase price — to secure the right to buy within a specified timeframe, usually one to three years. Monthly rent includes a premium portion allocated toward the eventual down payment, creating incremental equity accumulation while providing enhanced cash flow for investors.

Lease-purchase agreements create binding obligations for tenants to complete purchases, rather than preserving optionality. This distinction affects risk allocation, transferring more property responsibilities to tenant-buyers while reducing investor exposure to purchase default.

Purchase prices are established at contract inception as fixed amounts or through formulas tied to future appraisals. This mechanism exposes investors to market appreciation during the lease period while protecting tenant-buyers against further price escalation.

Provincial regulatory frameworks vary significantly. Ontario treats certain rent-to-own structures as mortgages under the Mortgages Act, imposing disclosure requirements and licensing obligations. British Columbia and Alberta maintain different approaches, requiring compliance with local real estate, landlord-tenant, and consumer protection legislation. Legal documentation must clearly delineate responsibility for property taxes, insurance, maintenance obligations, and rent credit treatment while establishing remedies for default scenarios.

Strategic Positioning Within Portfolio Frameworks

Investors deploy rent-to-own strategies within portfolio frameworks designed to balance cash flow, appreciation exposure, and exit flexibility. The model appeals particularly in markets with strong rental demand but constrained buyer pools, where traditional acquisition-and-hold approaches face headwinds.

Enhanced monthly cash flow through rent premiums — typically fifteen to twenty-five percent above market rates — provides income stability offsetting carrying costs in higher-interest environments. Upfront option fees create immediate capital for redeployment, improving return metrics on invested capital.

Rent-to-own arrangements shift maintenance and property care responsibilities toward tenant-buyers who maintain stakes in property condition. This dynamic reduces property management burdens compared to traditional rental operations, though investors retain ultimate ownership obligations until title transfer.

The model creates defined exit timelines aligned with market cycle positioning. Investors entering markets during price consolidation can structure agreements that crystallize gains if appreciation resumes, while those exiting mature positions generate premium pricing through tenant purchase motivation.

Risk Exposures and Market Viability

Tenant default on final purchase represents the primary risk, potentially leaving investors with properties requiring re-marketing after extended occupancy. Market depreciation during lease terms can create situations where agreed purchase prices exceed current values, generating tension around completion and potential legal disputes.

Tax implications require careful consideration. Treatment of option fees, rent premiums, and eventual sales differs from traditional transactions. Investors must account for potential characterization as instalment sales for income tax purposes, affecting capital gains recognition timing and rental income treatment.

The model’s viability depends on local market conditions including price-to-rent ratios, mortgage availability, and demographic profiles of potential tenant-buyers. Markets with strong employment bases, constrained construction, and populations of creditworthy individuals facing temporary financing barriers present optimal conditions.

Competition has intensified as individual investors and specialized firms recognize the model’s potential, affecting pricing dynamics, tenant selection criteria, and achievable terms. Markets with established rent-to-own activity demonstrate standardized practices and greater tenant awareness, reducing transaction friction but potentially compressing returns as approaches become commoditized.

Market Positioning and Forward Implications

The intersection of housing affordability challenges, evolving mortgage regulations, and demographic shifts suggests continued relevance for alternative ownership models. The rent-to-own structure addresses specific market inefficiencies through mechanisms that align investor returns with tenant pathways to ownership — a dynamic particularly relevant in jurisdictions where traditional financing remains constrained.

However, successful deployment requires market-specific analysis and careful risk calibration. Investors must evaluate local regulatory environments, competitive landscapes, and tenant pool characteristics while maintaining robust legal structures that protect against default scenarios and market volatility. The model’s evolution will likely reflect broader housing market pressures, with adoption patterns varying significantly across provincial markets based on regulatory approaches and local affordability dynamics.

The housing crisis is no longer an abstract concept. It is very real – and measurable – across the country.

The affordability of housing, measured by the ratio of homes prices to median household income, has declined dramatically over the past two decades.

Toronto and Vancouver are now poster children for the worst housing affordability. The cities rank first and second worst, respectively, among the 25 largest metropolitan areas in the U.S. and Canada.

The home price-to-income ratio in Toronto is 9:6, up from 5:5 in 2005 while Vancouver is at 12:5, up from 7:4. Proof of the problem is in the large number of stalled projects and empty sales centres.

Interest rates, material costs and economic headwinds all have a role to play in the decline, but an equally powerful – and more controllable – force is at work, namely an increasingly complex web of municipal green development regulations that are layered on top of provincial rules.

Regulatory Mazes Hike Costs

The province has tried to assert clarity and consistency through the Protect Ontario by Building Faster and Smarter Act and the proposed Fighting Delays, Building Faster Act, two pieces of legislation aimed at streamlining approvals and curbing the ability of municipalities to impose green building standards that go well beyond the Ontario Building Code.

However, as RESCON noted in a recent letter to the Ministry of Municipal Affairs and Housing, this has not translated into practice.

Municipalities across the GTA and beyond continue to apply green development standards through planning approvals, even if they can not technically amend construction standards directly. The result is a regulatory maze that adds substantially to construction costs, and results in delays.

In Durham Region alone, the Town of Ajax, City of Pickering, Town of Whitby and Municipality of Clarington each maintain their own green development standards, while the City of Oshawa does not. Now, the Region of Durham is developing a regional overlay. Even within a single upper-tier government, neighbouring municipalities have adopted divergent frameworks.

The City of Toronto, and towns of Halton Hills, Whitby and Ajax rely on tiered mandatory systems while Brampton, Markham and Vaughan use points-based approaches requiring minimum thresholds.

For builders operating in multiple jurisdictions, each application becomes a new exercise in interpretation.

Consumers Aren’t Asking for Measures

Green building standards alone can add between three and 12 per cent to construction costs, depending on the municipality and housing type.

At the lot level, additional measures carry discrete price tags: soak-away pits at roughly $6,000 per lot; bioswales at $4,000; permeable paver driveways at $20,000; and rain barrels at $800.

In some jurisdictions, compliance with new green development standards has been costed at $30,000 to $50,000 per unit.

Worse, many homeowners later remove or alter these features, suggesting they were not a priority.

The real question is not whether sustainability matters. It is who decides, how consistently and at what cost.

Home buying consumers are not asking for nor demanding the measures that municipalities are mandating in their green development standards. They merely slow down the approval and construction of new housing while inflating costs.

Delays Can Be Devastating

Fifteen years ago, development approvals were measured in months. Today, they are measured in years. Every study, soil specification, glazing analysis or electrical capacity review requires consultants, revisions and municipal review cycles. Even where costs appear modest in isolation, cumulative delay can be devastating in a high-interest-rate environment.

If municipalities continue to impose their own individual standards, it only perpetuates a system that prices out buyers and suppresses supply. Ontario cannot afford this type of paralysis.

We are facing the most pressing housing affordability crisis in generations. Municipalities need to be reined in with respect to what they can and can’t include in the scope of an application. Otherwise, we will have no hope of delivering new housing that Ontarians can afford.

How Strategic Platforms Are Reshaping Property Acquisition in Canadian Markets

Facebook’s 24 million Canadian users have transformed the platform into a critical infrastructure for real estate investment operations. Investors are deploying sophisticated marketing strategies that extend far beyond conventional advertising, using the platform’s unique combination of targeting precision, community engagement, and content distribution to identify opportunities, establish authority, and build sustainable deal pipelines across increasingly competitive markets.

Hyper-Local Targeting and Behavioural Segmentation

Real estate investors are implementing granular audience segmentation that aligns with specific investment criteria and market conditions. This approach incorporates behavioural signals, life events, and engagement patterns that indicate investment readiness or property ownership circumstances requiring liquidity.

Advanced strategies involve creating distinct audience profiles based on investment objectives. Buy-and-hold investors target different indicators than fix-and-flip specialists, while multifamily investors focus on characteristics that differ significantly from single-family approaches. Geographic targeting extends to postal code-level precision, allowing concentration on neighbourhoods experiencing rental demand shifts, infrastructure development, or demographic transitions.

Custom audience development represents the most sophisticated application. Investors build proprietary databases from property records, tax assessments, and probate listings, then upload these datasets to Facebook for targeted outreach. Lookalike audience modeling amplifies this by identifying users whose characteristics match established investor networks or previous transaction participants, expanding reach while maintaining relevance to specific investment theses.

Authority Positioning Through Strategic Content

Establishing thought leadership through content deployment has become essential for differentiation in crowded markets. This approach prioritizes value delivery over promotion, positioning investors as market experts while building trust with potential transaction partners and capital sources.

Educational content encompasses market analysis, investment methodology explanations, and regulatory updates demonstrating deep market knowledge. Video content proves particularly effective, property walkthroughs, renovation documentation, and market condition assessments showcase expertise while providing tangible value. Live streaming enables real-time engagement during property tours or investment workshops, creating interactive experiences that strengthen audience relationships and immediate credibility.

Long-form content exploring capitalization rate analysis, tax-deferred exchanges, or portfolio diversification strategies serves dual purposes: attracting qualified investors and establishing credibility with property owners who may become motivated sellers. Strategic scheduling ensures sustained visibility within target networks, while consistent delivery reinforces expert positioning across market cycles.

Integrated Paid Advertising Systems

Strategic paid advertising involves multi-stage campaign architectures guiding prospects through awareness, consideration, and conversion phases. These systems integrate pixel tracking, conversion optimization, and attribution modeling to maximize returns on advertising expenditure.

Successful investors structure campaigns around specific objectives rather than generic lead generation. Off-market acquisition campaigns target homeowners using life event triggers and property ownership duration parameters. Wholesaling operations implement rapid-response advertising tied to motivated seller indicators, while syndication-focused investors direct campaigns toward accredited audiences using income and asset-based targeting.

Retargeting strategies maintain visibility with users who have interacted with content, visited landing pages, or engaged with previous campaigns. Sequential messaging delivers progressively detailed information aligned with prospect decision stages. Dynamic creative optimization enables automatic testing of ad variations, ensuring optimal message-market fit across audience segments without manual intervention.

Network Effect Cultivation Through Community Building

Strategic Facebook group development has emerged as a powerful approach for investors establishing market presence and deal flow channels. These private communities create environments where investors control conversation dynamics while providing value that sustains member engagement and generates long-term business relationships.

Effective strategies balance educational content, peer interaction, and strategic positioning. Investors moderate discussions around market trends and investment opportunities while establishing expertise and accessibility. Geographic groups attract local investors, property managers, and service providers, creating networks that generate referral opportunities and partnerships. Niche groups concentrating on particular strategies attract highly qualified participants with aligned objectives.

Network effects compound over time as members recruit peers and communities become recognized market resources. Investors leverage group insights for market intelligence, identifying emerging trends and opportunity indicators before they manifest in broader data. Group environments facilitate relationship development that transitions to direct business opportunities, joint ventures, and capital partnerships outside the platform infrastructure.

The Competitive Imperative of Platform Mastery

The sophistication gap between investors who deploy comprehensive Facebook marketing strategies and those relying on traditional acquisition methods continues to widen. Investors who treat the platform as integrated infrastructure — combining algorithmic targeting, content authority, and network cultivation — are building compounding advantages that transcend individual transactions. These capabilities generate deal flow resilience across market cycles while reducing dependence on intermediaries and conventional sourcing channels.

As Facebook’s algorithm architecture evolves and user engagement patterns shift, the platform’s role in Canadian real estate investment operations will likely deepen rather than diminish. The structural advantages accruing to investors who develop systematic marketing capabilities suggest that platform proficiency is transitioning from a competitive differentiator to an operational necessity for portfolio growth and market positioning.

Ontario’s housing crisis has reached a point where euphemisms no longer help. This is not a normal market correction, a soft landing, or temporary cyclical slowdown. It is a systemic failure.

Housing starts have all but evaporated at precisely the time we need new homes the most. The upcoming Ontario budget must tackle the issue head-on and include measures to kick-start the industry.

Ontario’s housing cost-to-income ratio now exceeds 9:1, putting ownership well beyond the reach of many middle-class families.

In the Greater Toronto Hamilton Area, single-family home sales have fallen 71 per cent and condominium sales have plunged an astonishing 90 per cent. Across Ontario’s major urban centres, housing starts are down sharply year over year, with Toronto alone seeing a drop of nearly 60 per cent.

Tens of thousands of construction jobs have already disappeared, and economists warn the collapse in residential construction could shave between 1.5 and 2.5 per cent off Ontario’s GDP over the next two years.

In a recent pre-budget submission, RESCON laid out 10 ways to fix the problem. For RESCON, Budget 2026 is not just another fiscal exercise.

We have called on Queen’s Park to move decisively on a package of reforms aimed at restoring affordability and reviving homebuilding.

At the heart of the argument is a simple premise: housing is a basic economic necessity, not a luxury item, and should not be taxed or regulated as if it were alcohol or tobacco.

Budget 2026 is an opportunity for the province to reverse years of policy drift that have layered taxes, fees and delays onto new housing until many projects no longer make financial sense to build.

One of our most prominent asks is an expansion of Ontario’s portion of the HST rebate to all new homebuyers for homes priced up to $1.3 million, not just first-time purchasers.

By extending the rebate more broadly – and pushing Ottawa to follow suit on the federal share – the province could lower the upfront cost of new homes and help restart stalled projects.

Arguably more urgent is RESCON’s call to roll municipal development charges (DCs) back to 2015 levels for a three-year period and fundamentally rethink how infrastructure is funded.

DCs have ballooned in many municipalities. They are effectively hidden consumer taxes embedded in the price of new homes.

They unfairly load the cost of growth-related infrastructure onto new buyers while existing homeowners are largely insulated.

Shifting more of those costs onto the broader tax base, with predictable provincial support for municipalities, would spread the burden more equitably and reduce sticker shock for buyers.

Land transfer taxes are another target. RESCON wants both provincial and municipal land transfer taxes suspended for new, never-occupied homes for three years.

These taxes as regressive, adding thousands of dollars to the cost of ownership without contributing to housing supply.

In a market already strained by high interest rates and weakened consumer confidence, there is little justification for keeping them in place on new construction.

Beyond taxes and fees, action must be taken to speed up and simplify the notoriously slow and fragmented planning and approvals system.

Canada ranks second last among OECD countries for development approval timelines, a statistic that should trouble any government serious about boosting supply.

We are calling for province-wide digitization of planning approvals, standardized designs and broader use of as-of-right zoning to cut delays that can stretch projects by years.

Builders know how to build homes. What they cannot control is a glacial approvals regime that adds cost without adding value.

We must also look to the future of construction. We need stronger provincial support for off-site and innovative building methods, as well as incentives to accelerate adoption of PropTech and ConTech.

RESCON members visited Germany last fall and saw how that country has embraced industrialized, factory-built construction and digital planning to dramatically shorten timelines and improve productivity.

Catching up is essential if we are serious about boosting supply.

We have also called on the government to remove foreign buyer bans for new housing, particularly high-rise projects.

In the current market, these bans are doing more harm than good by suppressing demand for pre-construction units that are critical to financing large projects.

Our housing policy failures did not happen overnight, nor can they be fixed with a single budget. However, bold fiscal and policy movement now can mitigate the potential consequences.

Ontario should step in where some municipalities aren’t getting the message, as has been done in Alberta, and use its authority over taxes, housing policies, infrastructure to reverse course.

Ontario needs more homes. There is little doubt about that. But more importantly, it needs a steadier way to deliver them.

At the present rate of building, we are nowhere near reaching the targets set by the Ontario and federal governments.

However, recent planning policy changes may be of some help, as they have opened the door to small multi-unit housing on residential lots across several municipalities in the GTA and beyond.

The shift could be meaningful, as it makes as-of-rights path for three-to-six-unit buildings more feasible than it has been in 100 years. The challenge now is operational, not ideological.

The key is to turn what’s allowed on paper into projects that reach occupancy, at a fast-enough pace to move the needle.

Large, master-planned developments and high-rise projects are still needed and will remain essential. But they are complex to finance, slow to start, and sensitive to the cycles of the market.

On the other hand, smaller, multiplex projects with typically three to six units within existing neighborhoods, operate differently. They rely on familiar envelopes and well-understood systems. Offsite suppliers can standardize components and concentrate attention where context varies.

Multiplex Could Be the Answer

If Ontario wants near-term housing delivery without trading away quality or local character, multiplex could be the answer. A smarter, standardized approach can deliver multiplex housing at scale and enable consistent delivery.

There are good tools available to make this happen. A GIS-led screening step, supported by PropTech solutions like LandLogic can bring zoning insights, parcel geometry and servicing into focus so design and engineering teams can decide quickly whether a lot is viable or doesn’t fit the bill.

This front-loads predictability, reduces false starts and frames early conversations with municipal staff and neighbours around facts rather than hunches.

Beyond planning and zoning review, delivery also depends on early financial modeling. Before design begins, property owners and advisors should assess how different forms of multiplex – triplex, fourplex, or sixplex – perform under realistic rents, costs and interest rates.

Many property owners sit on underused parcels where a single bungalow or detached home could support multiple rental units with better long-term yield. Early financial analysis can reveal when that conversion makes sense and how to structure it sustainably.

New refinancing drivers such as CMHC’s MLI Select program are changing this calculus. By rewarding energy efficiency, accessibility and affordability with longer amortizations and higher loan-to-value ratios, these programs make it feasible for small developers and homeowners to think long-term.

What once required deep-pocketed investors can now be financed through standard lenders, provided the project meets measurable performance goals. When paired with professional design, this kind of financing can unlock thousands of small but meaningful projects across Ontario’s existing neighbourhoods.

Standardized Templates Can Be Used

Design must also be treated as a configurable product. With Building Information Modelling at the core, standardized design templates can be used while preserving room for professional judgment where sites differ.

Co-ordinated architectural, structural and 3D representations of a building’s mechanical, electrical and plumbing systems enable problems to be resolved early, and basic modeling ensures time schedules are kept and costs are aligned with scope. The outcome is fewer bylaw variances, more comparable pricing, and higher first-pass approvals.

Multiplexes must also be built in ways that reward repetition. Many such projects are suitable for panelized or modular assemblies such as cold-formed steel, structural insulated panels or hybrid systems that move labour offsite and reduce exposure of the structure to the elements.

Where conventional framing is the better fit, a standard sequence and detail set still shortens timelines and smoothes inspections. The point is not to have a single construction ideology; it is choosing methods that convert developments at larger volume across cities and towns.

Rules Must Be Legible

For all this to happen, the rules for multiplex projects must be legible. Digitizing provisions for multiplex and additional residential units and aligning them with a standard submission package reduces interpretation risk for applicants and reviewers. It doesn’t replace judgment; it provides a shared structure for it.

A collective step toward smarter housing delivery can make multiplex developments work. We have the available land and a growing ecosystem of planners, designers and builders who are ready to act. What’s missing is a framework to make the process repeatable.

A standardized and data-driven approach to multiplex delivery can change that, turning a standardized process, rooted in data, design quality, and collaboration, to generate opportunities without overwhelming communities or compromising design integrity.

Such an approach would strengthen the housing ecosystem. While tackling Ontario’s housing crisis will not come from one project or policy, we need to remove barriers and focus on housing forms that can be delivered consistently and at scale.

The crane count is coming down across the Greater Toronto and Hamilton Area (GTHA), a symbol of what’s been happening in the residential construction industry.

There were 235 cranes atop buildings across the region as of Jan. 1, according to a tracking and analysis tool of UrbanToronto (UT), a website that covers construction development and real estate. That’s a drop of 44 cranes from the 279 that were atop buildings at the same time last year.

The pipeline of projects continues to dwindle. Developers put forward 318 new projects in 2025, down from 395 the year before. The total number of dwellings proposed fell to 171,578 from 209,490.

UT also reports that the number of cranes is expected to dwindle further as new projects continue to decline.

RESCON and its builders are not surprised by these numbers. They support what we have been seeing for some time now. Residential construction projects are being shelved and many in the workforce are being let go.

Outlook Is Bleak

The outlook is not good. Housing starts are down by 58 per cent year-over-year in the City of Toronto, and 29 per cent year-over-year across all of Ontario’s census metropolitan areas excluding Toronto.

Industry job losses are already in the tens of thousands. More people will lose their jobs in the coming months as homebuilders are faced with difficult but unavoidable choices.

Reports suggest that if significant further public sector action is not taken to support the industry and reverse the ever-increasing job losses, Ontario will likely see a reduction in GDP by as much as 1.5 to 2.5 per cent in 2026 directly related to the situation affecting the residential housing sector.

The next few years could be even worse, with new home sales, starts and completions expected to come in around 30,000 annually in Ontario, according to the Canadian Centre for Economic Analysis (CANCEA). That will leave the province well short of the 1.5-million new home goal by 2031.

CANCEA’s modelling points to continued weakness in residential construction activity for roughly the next four to five years in Ontario, with starts and completions materially below the last decade’s norms.

The near-term consequence, CANCEA notes, is that roughly 35,000 residential construction workers in Ontario could be displaced on average, with displacement skewing heavily toward younger workers but with a meaningful share among older workers, which raises the risk of permanent skill loss.

Behavioural modelling done by CANCEA points to a deep and persistent slowdown. On an annual average basis, the expected scenario implies about 36 per cent fewer starts and 39 per cent fewer completions than the 10-year average.

Taxes Are Too High

To fix the problem, we must lower the tax burden on new housing so builders can build homes that people can afford. Taxes, fees and levies are too high, putting home ownership out of reach.

Taxes presently account for 36 per cent of the purchase price of a home. The federal and provincial governments are moving to provide some sales tax relief to first-time homebuyers, but the breaks must be extended to all buyers of new homes.

Runaway development charges (DCs), which have risen dramatically over the last two decades, also need to be reduced. DCs for a single-detached home in Toronto are around $125,000 while the average condo faces $130,200 in DCs.

The approvals process must also be digitized and simplified to speed up residential construction. In Toronto, it can take two years from the time a developer submits a building application to receiving approval.

Meanwhile, governments must do a better job of co-ordinating efforts around social housing and homelessness. They are both critical to the future, so we must have firm targets and a synchronized approach.

Finally, governments should concentrate their efforts on working with the private sector to fix what ails the industry, as private builders account for 90 per cent of housing supply.

A healthy residential construction sector is critical to the economic success of Ontario. The impact that the industry has on other sectors is enormous.

RESCON members alone directly employ more than 100,000 workers in Ontario and over 200,000 when indirect industries are included. The total size of the residential construction industry as an employer far exceeds other sectors such as steel, aluminum and auto manufacturing.

There is no time to waste. Fixes must be put in place now before it’s too late. There is no good reason to delay.

Driving faster in the wrong direction won’t get you to the right destination. To make progress you need to follow the correct path.

The same can be said for the housing supply and affordability crisis that we are presently facing. For years, we’ve been off track. And, as a result, we now find ourselves in a predicament.

The truth of the matter is that exorbitant taxes, fees and levies, including sky-high development charges (DCs), are making it difficult for builders to build homes people can afford.

The charges end up pushing the cost of a community’s new growth onto the purchaser of a new home. They are footing the bill up front, even though the infrastructure will serve generations.

Add in a cumbersome, expensive and glacially slow approvals system and you have a real problem.

Reports indicate that taxes are killing the market, and the already-dire housing situation could get worse. Governments will lose money for years if the industry does not pick up. Costly taxes and fees and lengthy approvals processes combine to hinder housing development.

DCs, specifically, are out of control. These are one-time fees that municipalities collect from developers for new construction to help fund infrastructure and services like roads, water, sewers, parks, transit, and police. But they’re also being used for projects like daycares and schools.

The levies are a problem and contribute significantly to the cost of buying a new home. A report done for RESCON found that 36 per cent of the cost of a new home is due to the tax burden. CMHC reports that DCs make up nine per cent of the total cost of a detached home in Toronto. The agency found that DCs alone could add more than $100,000 to the cost of new units.

Over the years, the fees have increased substantially, worsening affordability of new housing. In Toronto, DCs for a one-bedroom apartment increased to $52,000 in 2024 from $10,000 in 2014.

It is a problem that has been decades in the making. Governments now rely on revenues from DCs to fund their projects.

Four years ago, the Ontario Housing Supply Task Force Report recommended that action be taken to stem exorbitant DCs. However, the problem has not been addressed. The federal government has indicated it intends to reduce DCs, but we have yet to see any action.

The Ontario government provided some relief for builders with the passage of Bill 17. Payment of DCs will be pushed back until occupancy of the home. In the past, payment of DCs was due upon a building permit being issued. This means builders will not have to finance the cost of DCs while the home is being built.

However, there are other outstanding payments which are still due at the building permitting stage. More specifically, the payment of educational development charges, park land dedication and community benefits charges are still due during upon building permit issuance.

Admirably, the federal and Ontario governments have announced the elimination of sales taxes on new housing up to $1 million for first-time buyers as well as decreases on a sliding scale for first-time buyers of homes purchased between $1 and $1.5 million. First-time buyers account for roughly 35 per cent of new home purchases so this will have a positive effect.

But governments must now put DCs squarely in the crosshairs. The fees have exploded over the years.

CMHC recently piloted a project to collect information on development charges in 30 municipalities across the country and found they amount to a significant financial burden on development.

The level of charges per unit varied extensively. For a condo with two or more units, the DCs in 2025 varied from $55,566 in Burnaby, B.C., to $130,200 in Toronto. For a single-detached home, CMHC found that DCs varied from $111,629 in Burlington to about $180,600 in the City of Toronto.

We cannot continue with such exorbitant fees. We are in a housing crisis that is only going to get worse. Governments need to step in and create conditions to lower the DCs on new housing.

A report done recently for RESCON by the Missing Middle Initiative at the University of Ottawa found that housing starts in the first nine months of this year in 34 Ontario municipalities have plummeted from the same period in the previous three years. Job losses continue to grow.

Sales have all but dried up. Starts are low. And many developers are pausing or canceling projects altogether.

Housing starts were down 34 per cent in the municipalities surveyed, with condos taking a beating. Only 54 new condos were sold in Toronto in October – down from 145 in October 2024.

According to the analysis, the reduction in housing starts translated into 35,377 fewer person-years of employment over the first nine months of this year, compared to the same period in the previous three years.

Tackling the excessive tax burden associated with building and buying a new home would help kick-start the residential construction industry. Lowering DCs would be a positive first step.

Time is of the essence. We can’t waste it.

Brace yourself. Affordability of housing continues to deteriorate, and latest reports indicate the situation could get worse before it gets better, causing a huge hit to the Canadian economy.

Far fewer Canadian cities meet the traditional affordability benchmark where housing costs are less than 30 per cent of household income, recent data from prop-tech company Zoocasa revealed.

Reports indicate that median mortgage payments now consume about 46 per cent of household income in Canada versus 34.2 per cent in the U.S.

The cost of constructing a residential building in Canada has also increased 58 per cent since 2020 and could rise even further, thanks to U.S. tariffs, according to federal briefing materials.

One survey showed that in 2024 a Canadian home cost about 14 times the average disposable income, compared to nine times in the U.S. For comparison, as of mid-2025, the median home price in Los Angeles was 12.5 times the median household income. New York was 9.8 times.

In late 2023, the percentage of median household income needed to cover ownership costs was 84.1 per cent in Toronto, far exceeding the national average.

The increasing cost of housing is hurting the economy and making it difficult for people to find affordable places to live. Many are now leaving cities like Toronto. A poll by Environics Analytics for CTV News reports that last year 35,000 households left the Greater Toronto Area.

Dire situation could get worse

A report released recently by RESCON indicates that the already-dire housing situation could get worse in the Greater Toronto Area (GTA) and Greater Golden Horseshoe (GGH), as housing starts in the first nine months of 2025 were down substantially and industry job losses continue to grow.

The report looked at 34 municipalities and found that housing starts were down 34 per cent in those municipalities over the first three quarters of 2025, relative to the January-to-September periods in 2021-24. Condo apartment starts were down 51 per cent in 2025 relative to the same earlier time periods.

The analysis estimated that the reduction in housing starts over the first nine months of this year translates into 35,377 fewer person-years of employment.

The figures in the report are an eye-opener as they indicate we are trending in the wrong direction.

Projects are being shelved which will have a trickle-down effect on the economy. Sales have been stopped on more than 3,200 new units between 2020 and 2025. The cost of building is just too high. Only 54 new condos were sold in Toronto in October, down from 145 in October 2024.

An editorial in The Globe & Mail noted that in five years, the construction of new homes in the country’s hottest markets is projected to slow to near-zero. So, we will have less construction, fewer homes, and fewer jobs – all at a time when the country needs more housing.

Industry is critical to economy

This will all have a disastrous effect on our economy, as construction accounted for 7.5 per cent of the Canadian GDP in 2023.

It’s a recipe for disaster. The residential construction industry is critical to the Canadian economy.

A new report from Concordia University’s John Molson School of Business indicates that improving housing affordability could deliver a boost to local economies, not just help families.

In an illustrative model for Toronto, the report concluded that a $3-billion housing-supply incentive program could generate an estimated $672 million in recurring annual tax inflows, implying a four-to-five-year fiscal payback – even without accounting for further positive multiplier effects.

As noted by Erkan Yönder, associate professor of real estate and finance at Concordia, housing affordability is not just a social issue, it’s really an economic one too.

“High housing costs affect the entire economy, everything from family finances to business productivity and municipal budgets,” he said in a statement. “With the growing pressures in the Canadian economy, it is important to do everything we can.”

When builders are working, taxes are flowing into government coffers. Workers are earning wages which boosts the economy. And the new homes provide somewhere for Canadians to live.

Governments must pull out all the stops to get the industry back to work. The cost of building needs to come down, namely through further reducing the exorbitant taxes, fees and levies on new homes. Presently, 36 per cent of the cost of a new home is attributable to the tax burden.

Builders need to be able to build homes that people can afford. Our economy depends on it.

Calgary’s housing market has been showing a great deal of variability this year. By September, citywide conditions had settled into balance, but several neighbourhood clusters kept prices close to last year’s levels, while some others showed modest gains.

Calgary’s Split Market

By late summer, it became apparent that Calgary wasn’t moving as a single market. The composite benchmark sat at $572,800, down 4.0% year-over-year (y/y), with 6,916 active listings and 4.02 months of supply, suggesting a balanced environment without the declines seen in some other Canadian markets. However, results diverged sharply by housing type.

Detached homes slipped just 1% y/y to $749,900. Semi-detached homes actually rose 1% y/y to $684,800, making them the city’s best-performing category. Row homes fell 5% y/y to $437,100, while apartments saw the largest drop at -6% y/y to $322,900, with supply stretching to roughly five months. Those differences help explain which neighbourhoods held up best and which lost ground.

According to top Calgary realtor Jesse Davies, “Neighbourhoods dominated by detached and semi-detached naturally followed the trends of the two strongest segments, so their overall benchmarks tended to decline or showed year-to-date growth, although key exceptions in high-demand areas do exist. On the other hand, communities with large concentrations of apartment or row housing mirrored the weaker segments.”

Areas where semi-detached infill is the dominant form, especially in the inner city, benefited from the only segment still posting year-over-year gains, which helped keep local benchmarks steadier than the citywide picture suggests. Communities built around a larger base of row homes or condos, however, reflected the softer performance of those categories. Supply dynamics reinforced the divide. Apartment inventory sat near five months in September, while detached and semi-detached remained considerably tighter. Neighbourhoods with a greater share of those tighter low-rise segments consistently showed firmer values, even as broader conditions cooled.

Neighbourhood performance in 2025 also followed the basic fundamentals that shape demand in any market. Areas with established schools, good transit, and mature retail or services continued to draw steady buyer interest, which helped them absorb rising listings with less price impact.

Jesse Davies confirms, “These underlying fundamentals continue to work together with the property-type dynamics to shape which parts of Calgary held their value best through September.”

Where These Patterns Showed Up in the City

Against that mixed backdrop, a few parts of the city stood out for holding their values more firmly than the rest.

North West: Calgary’s Steady Performer

If price stability defines success, the North West was Calgary’s steadiest district in September. The total-residential benchmark of $633,200 was only -2.1% y/y, half the citywide decline.

As Jesse Davies notes, “The resilience in the north west reflects the district’s fundamentals. It’s dominated by low-rise, family-oriented streets rather than large condo clusters, attracting buyers motivated by schools, LRT access, and community continuity.”

Because detached and semi-detached homes, Calgary’s strongest categories, form the backbone of its housing stock, the district had a built-in advantage. Neighbourhoods like Varsity, Brentwood, Dalhousie, Edgemont, Hamptons, Citadel, Tuscany, Royal Oak, and Rocky Ridge all benefited from that composition. Without a glut of apartment supply, they avoided the price pressure seen elsewhere and posted the smallest year-over-year pullbacks in the city.

West: Equity Strength and Limited Substitutes

West Calgary ranked a close second, posting a total residential benchmark of $707,300, with sub-neighbourhoods performing well. Here, the story was less about product type and more about buyer profile and supply scarcity.

Neighbourhoods such as Aspen Woods, Springbank Hill, West Springs, Signal Hill, Strathcona Park, Patterson, and Cougar Ridge are dominated by move-up detached and semi-detached homes. Buyers in these areas are typically equity-rich and shopping within a narrow geography, driven by specific schools, commutes, and amenities. Even as listings rose citywide, there were few comparable substitutes west of Sarcee Trail, so competition stayed firm, and prices held close to flat.

West Calgary was able to avoid the oversupply seen in the North East and East districts, where the steepest declines occurred, coinciding with inventory growing fastest.

City Centre: The Semi-Detached Advantage

At first glance, the City Centre looks like it softened, with a September benchmark of $576,800 (-4.4% y/y). However, on a year-to-date basis, it actually leads Calgary in price growth, with a rise of over 4% compared to the same period in 2024.

Davies suggests that the reason for this is semi-detached homes. “This property type posted the strongest YTD gains across the city, driven largely by the City Centre’s infill corridors.”

Areas such as Altadore, Killarney/Glengarry, South Calgary, Richmond, Hillhurst/West Hillhurst, Mount Pleasant, Capitol Hill, Renfrew, and Bridgeland/Riverside saw steady demand for duplex-style homes, even as nearby condo towers softened.

In September, semi-detached prices averaged $684,800, up about 1% y/y, while apartments averaged $322,900, down 6% y/y, with supply reaching its highest level since 2021. That split explains why inner-city duplex streets remained hot even when the district average dipped; its strongest segment is still growing.

South and South East: Average Results but with Local Standouts

The South districts landed near mid-pack overall, but results vary widely by neighbourhood. Detached-heavy communities such as Lake Bonavista, Haysboro, Canyon Meadows, Oakridge, McKenzie Towne, Cranston, Douglasdale/Glen, Mahogany, and Auburn Bay largely mirrored the city’s detached trend, with only shallow declines.

Areas built around newer condo nodes, however, followed the apartment curve, showing greater supply, slower absorption, and deeper price adjustments.

Where the Market Cooled

At the lower end of the market, the North East recorded the sharpest year-over-year drop at 7.9%, with a benchmark of $485,000, while the East followed with a 6.5% decline and a benchmark of $409,000. Additionally, the North East posted the city’s largest condo drop at -10% y/y, for a particular cooling in this segment.

Both districts added significant inventory through late summer, and both lean heavily toward the apartment segment, which faced five months of supply and the steepest price corrections.

Assessing Current Comparables

Calgary’s “hot” neighbourhoods in 2025 were about price retention in a normalizing market, with strong trends related to housing type. These price growth patterns have consequences for those looking to buy, sell, or invest.

It is important to be aware of nuances. As Davies notes, “For sellers in stronger low-rise pockets, for example, the trends support firmer pricing and more measured adjustments, rather than assuming the whole city has dropped by 4%; their reality is closer to the detached and semi-detached trend than to the headline composite.” In areas where apartments and newer rows dominate and supply has expanded more quickly, sellers are operating in a softer environment, where sharper pricing and cleaner terms often matter more than holding out for last year’s numbers.

For buyers and investors, the same split changes how an opportunity looks. In communities anchored by established amenities and a large share of detached or semi-detached homes, the room for bargain hunting is limited, according to Davies, and the decision often comes down to paying fair value for a stable asset in a stable micro-market. In locations with heavier exposure to multi-family stock, wider gaps between list and sale prices can open up, but those come with different risks around future absorption and further adjustments.

In 2025, the practical takeaway is that price growth and price protection have followed housing form and key fundamentals more than citywide headlines.

To navigate this terrain, it helps to work with a local specialist. Calgary-born and raised, Jesse Davies brings over 16 years of experience and has consistently ranked among Calgary’s top-producing agents. He and his team are noted for their market knowledge across the city and for translating complex benchmark and inventory data into actionable insight for buyers, sellers, and investors.

The federal and Ontario governments have stepped up to the plate by cutting the sales taxes on new homes for first-time buyers. It took them a while to get there, but to their credit, they did.

Once legislation is passed, a first-time buyer who purchases a new home up to $1 million will no longer have to pay the five-per-cent GST or eight-per-cent HST. It will be retroactive to May 27. For homes purchased between $1 and $1.5 million, taxes will be reduced on a sliding scale.

The move is significant as first-time buyers account for roughly 35 per cent of new home purchases. On a $1-million home, first-time buyers will now save $130,000 on the purchase price.

It’s also a positive for our industry. Exorbitant taxes, fees and levies are crippling the residential construction industry, stymying the build of new homes and condos, and driving up housing costs.

The tax burden presently accounts for 36 per cent of the cost of a new home. The best way to improve housing affordability, then, is to lower taxation.

Already, I have received reports that the tax cut is moving the needle on housing, as there is more traffic reported at sales centres. RESCON will be keeping a close eye on this to gauge the outcome.

Can you imagine what would happen if the sales tax was eliminated for all buyers of new homes – not just first-timers? It would move the needle significantly and spur more housing construction.

Benefits of cuts outweigh costs

A rebate of the provincial portion of the HST for first-time homebuyers on newly built homes valued up to $1 million is projected to cost the government $35 million in 2025-26, $190 million in 2026-27, and $245 million in 2027-28. The projections were based on housing data and economic policies.

However, the benefits far outweigh the costs.

The policy will result in more housing being built, more direct construction and spinoff jobs, a healthier economy, and more property tax revenue for governments once the homes are built and occupied.

Everybody wins.

According to the Missing Middle Initiative (MMI), governments are bleeding billions of dollars in revenue from the current housing decline. The organization estimated that governments could lose more than $6 billion in tax revenue from declining owner-occupied housing construction in the GTA.

The MMI ran the numbers using CHMC data and found that owner-occupied starts generated an eventual $10.8 billion for governments in 2023, but with starts lower that figure will drop to $4.8 billion annually between 2025 and 2027. The feds will lose nearly $2.4 billion, the provinces more than $1.9 billion and municipalities $1.7 billion.

The MMI found that the housing slump will cost the federal and provincial governments $900 million a year in lost HST revenue in the GTA alone.

The point here is that governments are losing huge dollars from the lack of new housing being built. They might as well cut the sales taxes as it will boost the industry and lead to more growth.

As a result of fewer homes being built, they’re getting less in the way of funds from the HST, so what’s the risk?

The upside is tremendous.

Tax burden must be reduced further

Presently, the housing supply and affordability situation is dire. Ontario indicated in its spring budget that it expected to see 71,800 homes built this year, but the projection is now 64,300. Projections for the next few years are also low, with 70,200 expected in 2026, 79,600 in 2027 and 83,700 in 2028.

Industry employment has also taken a major hit. In the City of Toronto, for example, industry employment declined by an estimated 10,209 jobs in the first six months of 2025.

To correct course, the tax burden on new homes must come down further. We appreciate that the senior levels of government have taken action to cut sales taxes for first-time buyers, but the initiative must be expanded, at least temporarily, to buyers of all new homes. Taxes are simply too high.

The issue of exorbitant development charges (DCs) levied by municipalities must also be tackled. It was a key recommendation of the Ontario Housing Supply Task Force Report back in 2022. However, it’s been nearly four years now, and the problem has not yet been addressed.

In Toronto today, developers pay nearly $140,000 in municipal taxes on a single-family home. DCs for smaller units range from $60,000 for a bachelor apartment to more than $80,000 for a two-bedroom unit. The charges are passed on to the homebuyer in the form of higher prices.

Clearly, the industry can not continue to operate under the yoke of such excessive taxes. We’re in the worst housing crisis in a generation. The cost of housing must be reduced. More action is critical.