Canadian housing construction has not kept pace with immigration-fueled population growth, leading to historically elevated shelter inflation. Shelter accounts for about a quarter of Canada's consumer-price index basket, with shelter-price inflation reaching 6.1% in October, and rent inflation at 8.2%, a four-decade high. The Bank of Canada's deputy governor, Toni Gravelle, highlighted the impact of immigration on housing-supply strains and the need for a significant increase in housing construction to alleviate upward pressure on rent and house prices. The Canadian Mortgage and Housing Corp. estimates the country needs 3.5 million new homes to bring house prices down to relatively affordable levels.

Canada's Housing Construction Challenges