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Housing

Eliminating Interprovincial Trade Barriers Could Add 30,000 Housing Starts Annually

Strategic Insights

— 2 min read

Canada could significantly close its housing supply gap by removing interprovincial trade barriers, according to a new analysis by the national housing agency. The study estimates that eliminating these barriers would add 30,000 more housing starts annually, bringing the total number of annual housing starts close to 280,000 over time. This would represent a "meaningful step towards fixing Canada's housing supply gap" and would have a positive impact on the economy and home ownership.

Key Takeaways:

  • Eliminating interprovincial trade barriers could add 30,000 more housing starts annually, reaching a total of 280,000 starts per year.
  • This would represent a "meaningful step towards fixing Canada's housing supply gap" and would have a positive impact on the economy and home ownership.
  • The Canadian Mortgage and Housing Corp. estimates that up to 4.8 million new homes will need to be built over the next decade to restore affordability levels last seen in 2019.
  • The report's projections would represent close to 15% of the additional housing supply needed annually over the next decade to return to pre-pandemic affordability levels.
  • CMHC projects an average of 245,000 starts annually over the next 10 years under current conditions.
  • Eliminating interprovincial trade barriers was a focal point of Prime Minister Mark Carney's campaign during the spring federal election.
  • Existing internal trade hurdles cost the economy some $200 billion a year, according to the Canadian Federation of Independent Business.
  • A survey by Statistics Canada shows that nearly half of Canadian construction firms blame distance and transportation costs as the main reasons for not purchasing goods or services from suppliers in another province or territory.
  • Canada has "ample domestic production" of core construction resources, with a significant share that could be redirected towards residential construction.

Statistics:

  • Nearly half of Canadian construction firms blame distance and transportation costs as the main reasons for not purchasing goods or services from suppliers in another province or territory (Statistics Canada survey).
  • Canada could add 30,000 more housing starts annually by eliminating interprovincial trade barriers (Canada Mortgage and Housing Corp. analysis).
  • The total number of annual housing starts could reach 280,000 over time (Canada Mortgage and Housing Corp. analysis).
  • Up to 4.8 million new homes will need to be built over the next decade to restore affordability levels last seen in 2019 (Canada Mortgage and Housing Corp. estimates).
  • CMHC projects an average of 245,000 starts annually over the next 10 years under current conditions (CMHC reports).
  • Existing internal trade hurdles cost the economy some $200 billion a year (Canadian Federation of Independent Business estimates).

Sources:

  • Canada Mortgage and Housing Corp. (CMHC) report, cited in the Canadian Press article.
  • Statistics Canada survey, cited in the Canadian Press article.
  • Canadian Federation of Independent Business, cited in the Canadian Press article.
  • The Canadian Press article.

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