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Toronto Started 156 Condos in Six Months While Needing 3,500: The Math Doesn't Add Up
CMHC published its Fall 2026 Housing Supply Report September 10, 2026, and one line in it should make every city planner in Ontario sweat: the City of Toronto proper broke ground on 156 condominium units in the first six months of this year. Not 1,560. One hundred and fifty-six.
The decade average for Toronto is roughly 7,000 units annually, call it 3,500 in a typical six-month window. The city just delivered 4% of that. And while the national picture isn't quite as bleak, the arithmetic there is equally unforgiving: CMHC estimates Canada faces a structural shortfall of 187,000 to 238,000 homes per year over the next decade, the gap between current construction pace and the 417,000 to 469,000 homes CMHC says are needed annually to restore 2019-level affordability by 2036.
The lag is longer than you think
The 156 starts in Toronto reflect pre-construction sales that closed 18 to 24 months ago, meaning late 2024 or early 2025, when the Bank of Canada's policy rate was still above 4% and buyers had mostly vanished. High-rise condos require 70% to 80% of units pre-sold before construction financing gets released. If nobody buys, nobody builds. That's what happened.
Even if buyer appetite returns tomorrow, the impact won't show up in "starts" data until 2028 at the earliest. High-rise construction takes four to six years from groundbreaking to occupancy. The 156 units that began this year will deliver in 2030 or 2031. The supply vacuum for 2029 through 2031 is already locked in.
The investor model is broken
Toronto's condo boom was powered by small-scale investors, individuals buying pre-construction units, closing on completion, and renting them out while banking on appreciation. That model worked when carrying costs were manageable and rents were climbing. It stopped working when financing costs spiked and rent growth stalled. A one-bedroom condo purchased in 2024 for $650,000 at 5.5% carries a monthly cost well above what the unit rents for, even before maintenance fees and property tax. The arithmetic doesn't close, so the buyers disappeared.
Some will argue this is healthy, that a slowdown was necessary to clear the glut of unsold inventory from 2023 and 2024. Fair. But absorption and supply creation are not the same problem. The GTA absorbed roughly 8,000 unsold units over the past eighteen months. The 156 starts in Toronto proper represent a collapse in new production.
Purpose-built rentals are not filling the gap
Purpose-built rental construction is not picking up the slack. While some suburban GTA municipalities are seeing rental projects move forward, the volume is nowhere near sufficient to replace the density that condos historically provided in Toronto. CMHC's own data shows total housing starts across all categories remain well below the 417,000-unit national benchmark, and the City of Toronto, the jurisdiction with the highest concentration of demand, is producing almost nothing.
Federal and municipal governments have rolled out housing accelerators, GST rebates on rental construction, and zoning reforms. The private sector, which delivers the bulk of urban density, is essentially on strike. Financing costs remain elevated despite recent rate cuts, and development charges in the GTA continue to make projects uneconomic. Policy can nudge. It cannot override the spreadsheet.
What 2030 looks like
By the time the supply hole becomes visible in rents and prices, likely late 2029 or early 2030, it will be too late to fix it. You cannot excavate, build, and occupy a 40-storey tower in under four years. The units that should be delivering in three years should have started this year. They didn't.
The national gap of 187,000 to 238,000 homes per year is an average across the country. In Toronto, the shortage is a cliff: the units the city needed to start in 2024 and 2025 to meet demand in 2029 and 2030 did not break ground.
CMHC published its Fall 2026 Housing Supply Report September 10, 2026, and one line in it should make every city planner in Ontario sweat: the City of Toronto proper broke ground on 156 condominium units in the first six months of this year. Not 1,560. One hundred and fifty-six.
The decade average for Toronto is roughly 7,000 units annually, call it 3,500 in a typical six-month window. The city just delivered 4% of that. And while the national picture isn't quite as bleak, the arithmetic there is equally unforgiving: CMHC estimates Canada faces a structural shortfall of 187,000 to 238,000 homes per year over the next decade, the gap between current construction pace and the 417,000 to 469,000 homes CMHC says are needed annually to restore 2019-level affordability by 2036.
The lag is longer than you think
The 156 starts in Toronto reflect pre-construction sales that closed 18 to 24 months ago, meaning late 2024 or early 2025, when the Bank of Canada's policy rate was still above 4% and buyers had mostly vanished. High-rise condos require 70% to 80% of units pre-sold before construction financing gets released. If nobody buys, nobody builds. That's what happened.
Even if buyer appetite returns tomorrow, the impact won't show up in "starts" data until 2028 at the earliest. High-rise construction takes four to six years from groundbreaking to occupancy. The 156 units that began this year will deliver in 2030 or 2031. The supply vacuum for 2029 through 2031 is already locked in.
The investor model is broken
Toronto's condo boom was powered by small-scale investors, individuals buying pre-construction units, closing on completion, and renting them out while banking on appreciation. That model worked when carrying costs were manageable and rents were climbing. It stopped working when financing costs spiked and rent growth stalled. A one-bedroom condo purchased in 2024 for $650,000 at 5.5% carries a monthly cost well above what the unit rents for, even before maintenance fees and property tax. The arithmetic doesn't close, so the buyers disappeared.
Some will argue this is healthy, that a slowdown was necessary to clear the glut of unsold inventory from 2023 and 2024. Fair. But absorption and supply creation are not the same problem. The GTA absorbed roughly 8,000 unsold units over the past eighteen months. The 156 starts in Toronto proper represent a collapse in new production.
Purpose-built rentals are not filling the gap
Purpose-built rental construction is not picking up the slack. While some suburban GTA municipalities are seeing rental projects move forward, the volume is nowhere near sufficient to replace the density that condos historically provided in Toronto. CMHC's own data shows total housing starts across all categories remain well below the 417,000-unit national benchmark, and the City of Toronto, the jurisdiction with the highest concentration of demand, is producing almost nothing.
Federal and municipal governments have rolled out housing accelerators, GST rebates on rental construction, and zoning reforms. The private sector, which delivers the bulk of urban density, is essentially on strike. Financing costs remain elevated despite recent rate cuts, and development charges in the GTA continue to make projects uneconomic. Policy can nudge. It cannot override the spreadsheet.
What 2030 looks like
By the time the supply hole becomes visible in rents and prices, likely late 2029 or early 2030, it will be too late to fix it. You cannot excavate, build, and occupy a 40-storey tower in under four years. The units that should be delivering in three years should have started this year. They didn't.
The national gap of 187,000 to 238,000 homes per year is an average across the country. In Toronto, the shortage is a cliff: the units the city needed to start in 2024 and 2025 to meet demand in 2029 and 2030 did not break ground.
Sources
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