Ontario Faces a Housing Pipeline Collapse

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 🫣 Ontario Faces Housing “Cliff” by 2026

• Ontario’s six-month average for starts is now at its lowest in a decade.

• RBC warns Ontario’s housing pipeline could “taper out by 2026,” not 2027–28 as earlier thought.

• Over 93,000 units remain under construction (only 11% off record highs), but completions will thin out quickly if new starts don’t rebound.

• Toronto condo starts are plunging, while municipalities continue to issue numerous permits, indicating that the barrier is cost, not regulation.

• If completions fall just as immigration rebounds, Ontario’s affordability crisis will intensify.

Why It Matters: Ontario is heading toward a massive supply gap after two years of weak housing starts. Developers have been cancelling or delaying projects, and while current builds are still being completed, there’s little coming in behind them. The shortage will hit hard once the existing wave of projects is finished.

😥 Calgary Homes Sitting Twice as Long

• Homes in Calgary now take an average of 61 days to sell (up from 34 days last year).

• Condos sit for 71 days on average, more than double last year’s 32.

• 27% of homes were relisted in 2025 (compared to 9% in 2024), creating a misleading “fresh” appearance. Actual time on market is ~19 days longer than reported.

• Calgary’s inventory increased by 66% year-over-year, easing pressure and providing buyers with more options.

• While Calgary cools, Canada’s overall housing market is rebounding — sales rose 3.8% in July, marking four straight monthly gains.

• Buyers should be cautious, as relisting masks actual demand. Prices could rise again nationally by fall.

Why This Matters: With homes taking nearly twice as long to sell and inventory up 66% year-over-year, buyers can take their time, negotiate harder, and spot deals. But they also need to be cautious: many homes are being relisted to look “fresh” on the market, which can hide stale demand.. _(source) 

💸 Canada’s $40B Mortgage Rush

• Mortgage starts jumped 27.5% year-over-year in June, reaching $40.7 billion, the second-highest June on record.

• On a rolling 12-month basis, $436 billion in new loans were originated, up 38.5% from the previous year.

• The spike isn’t due to rising sales; it’s driven by pandemic-era pre-construction completions finally coming to a close.

• Investors from 2020-22 are now taking possession and need financing.

• Most Canadians are opting for 3- to 5-year fixed terms (37% of originations) at ~4.13% — the most affordable product.

• Variable mortgages are back, making up 31.5% of loans, as borrowers bet on more rate cuts.

Why It Matters: The surge appears less like a housing revival and more like delayed financing from investors who bought at the peak of frenzy. With a near-record volume of homes under construction, more completions (and, consequently, more mortgages) are expected, but sales remain weak.

👋🏼 Canadians Dump U.S. Sunbelt Homes

• Canadian buyers are withdrawing from U.S. vacation home markets, particularly in Florida and Arizona.

• Realtors report clients selling off U.S. homes and refusing to reinvest.

• Redfin data shows Canadian searches for U.S. properties dropped 22% YoY, with the steepest fall in April (-34%).

• Costs add pressure: weak Canadian dollar (70–72¢ U.S.), soaring HOA fees, hurricane-driven insurance hikes.

• Canadians were once 14% of foreign buyers, spending $6.2B, second only to China.

Why This Matters: Realtors say the loss hurts local economies beyond housing: Canadians spent heavily on cars, restaurants, and tourism. Some analysts expect the pullback to continue into 2026, even if rates fall and housing prices soften further. Realtors in southern Florida report that sales are down 50% this year, largely due to the decline in Canadian buyers. _(source) 

🤔 WTF of the Week

This Scarborough detached home dropped like a rock, selling for $925K just a year after it was listed for $1.298M. That’s a $373,000 haircut in under 12 months.

Even crazier: it didn’t even clear its recent list of $974K, closing lower.

From pandemic bidding wars to today’s bruising market, this is a brutal reminder of how quickly valuations can turn.

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