Higher Interest Rates Cut Canadian Housing Starts by 30,000 Units in 2023

The CMHC reports a significant slowdown in new condo construction due to elevated interest rates, despite some offset from supportive policies.

Canada experienced a 10 to 15 percent reduction in housing starts last year, attributed to higher interest rates.
The construction of condo buildings was particularly impacted, except in Alberta where starts remained steady.
The Bank of Canada's interest rate hikes in 2022 and 2023 were aimed at controlling inflation, leading to reduced housing activity.
Although mortgage rates have begun to decline in 2024, the long-term housing shortage remains a critical issue.
CMHC emphasizes the need for private sector investment and government support to boost housing supply amid economic fluctuations.