Low builder confidence illustrates need for sustained federal action plan focused on homeownership housing

April 21, 2026 – Ottawa, ON – The Canadian Home Builders’ Association (CHBA) released its Q1 2026 Housing Market Index (HMI) today, showing near record-low builder confidence in the single-family market and a new record low in the multi-family market—signalling fewer housing starts for homeownership ahead without focused policy action. Even regions like Atlantic Canada and the prairies that had been weathering the trade-war storm are now slowing, with dropping builder confidence from coast to coast.

CHBA’s HMI is an analysis of home builder sentiment that provides a leading indicator about the current and future health of the residential construction industry in Canada with respect to housing units for ownership (freehold or condominium). The 2026 Q1 single-family index fell 5.5 points to 20.9, which is just 1.3 points above the all-time record low. The multi-family index reached a third consecutive new record low and now sits at just 13.4.

CMHC’s latest housing starts report points to a continued loss of momentum in housing construction, as predicted by CHBA’s HMI, which is a proven indicator of housing starts that can be expected in six months and beyond. CMHC’s housing starts data combines homes built for rental and ownership; the surge of purpose-built rental starts has masked the drastic loss of momentum in starts for ownership. In March 2026, CMHC data indicated that units slated for rental markets represented 56% of all urban starts. Given affordability challenges in recent years, there has been a drastic shift to rental starts—in 2021, about 70% of housing starts were for ownership; that number is now below 50%. This is reflective of the precipitous shift away from homeownership facing the next generation.

CHBA CEO Kevin Lee stresses that the federal government needs a plan focused on homeownership, and that the provinces must implement funding strategically to reduce taxes, and swiftly, to avoid further market confusion.

“The federal government’s $1.7 billion one-time cash injection to provincial governments to reduce housing costs and support more housing supply is a positive step forward, but it is critical that provincial governments to use the funds effectively. Reducing government-imposed costs is the most immediate and effective way to improve housing supply and affordability for homeownership. Eliminating taxes on new homes, reducing skyrocketing development charges, and finding low and no-cost measures to support homeownership affordability – like responsible changes to the mortgage stress test – should be part of a robust federal plan for supporting homeownership,” said Lee.

The Q1 survey was put out into the field the day before the Ontario government announced its intention to expand the HST rebate from only first-time buyers to all eligible buyers of new construction homes valued up to $1 million, and has not yet had time to result in an uptick in Ontario’s HMI results. However, there is momentum in sales offices and if the political and administrative processes are finalized quickly, CHBA expects an improvement in builder sentiment to be reflected in the HMI for the province next quarter.

While Ontario and BC (where housing supply is most in crisis) have been bearing the brunt of diminished buyer confidence and affordability challenges, other regions of the country are also starting to slip: the prairies continued their decline, with Q1 showing their first recent pessimistic reading for the multi-family HMI, and the Atlantic provinces posted their first pessimistic reading on record for the single-family HMI since the survey began in 2021.

Labour market conditions continued to get even worse, driven by further losses in Ontario. Nationally, 47% of builders said that they or their subcontractors have needed to lay off workers due to market conditions. In Ontario, this proportion rose to 65%.

“Broad layoffs will leave the residential construction industry without capacity, which will hinder its ability to ramp back up when the market turns around, which means supply will continue to be constrained. More action is needed now by all levels of government to help stem the tide on job losses in the sector. Canada needs a comprehensive plan that includes support for homeownership to reach the government’s own housing targets and alleviate market-rate affordability challenges so that the next generation of Canadians can hope to have something close to the same opportunities as their parents,” said Lee.

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MEDIA INQUIRIES

Journalists wishing to interview Kevin Lee, Chief Executive Officer of the Canadian Home Builders’ Association are encouraged to submit their request by email to media@chba.ca.

About the HMI

CHBA’s HMI provides a leading market indicator for both the single-family and multi-family markets in Canada, before permits and starts. Released on a quarterly basis, the HMI provides insight into the industry, including many of the issues that are affecting housing affordability, with a strong correlation to future housing starts. The data for the CHBA HMI comes from an exclusive panel of hundreds of CHBA home builders and developers from coast to coast. Every quarter, this panel responds to a series of questions about market conditions. CHBA then uses proprietary statistical analysis to prepare the quarterly HMI. In addition to the standard HMI questions, each quarter CHBA asks “special questions” that allow the Association to gather data and insights into current issues affecting the industry across the country.

For more information on CHBA’s HMI, including the detailed methodology and key takeaways, please visit the official CHBA HMI webpage.