Ontario housing starts dip in May after strong start to 2026

New housing construction in Ontario experienced a minor slowdown in May, a contrast to the robust beginning of the year. The province continues to fall considerably short of its ambitious target to construct 1.5 million new homes by 2031.

Data from the Canadian Mortgage and Housing Corporation indicated a national decline in housing starts for May, approximately five percent lower than in May 2025. Ontario's regional figures showed a three percent drop, with construction commencing on 5,661 new units last month, compared to 5,866 in the same period last year. Despite this dip, the annual totals for 2026 remain significantly better, with an 18 percent increase in housing starts compared to 2025.

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Housing affordability has been out of reach for too many for too long. And that is why, under the leadership of Premier Ford and our great minister of finance, we’ve cut the HST.

However, Ontario is still far from its goal of building 1.5 million new homes between 2022 and 2031. To date in 2026, work has begun on 26,084 new units, against a yearly target of 175,000. This pace means that with 42 percent of the year elapsed, Ontario has only achieved 15 percent of its target.

The Ford government has faced challenges in the housing sector for years. Initially, Premier Doug Ford attributed the slowdown to rising interest rates, predicting a surge in new homes if rates decreased. When borrowing costs fell, the market did not rebound. Subsequently, Ford pointed to the costs of building approvals and permits from municipalities as the issue, an area his administration has attempted to address through legislation. The province also introduced a new home tax incentive for first-time buyers, which the premier later admitted might not be effective without expansion. The government has since expanded this offer and partnered with the federal government to reduce development charges for homebuilders, measures Housing Minister Rob Flack claims have led to a sharp increase in demand and sales.

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What are we seeing? We’re seeing a game-changing event. I’ve talked to builders throughout Kingston, Milton, Mississauga, London, Hamilton, it is a game-changer. We are seeing a buzz in sales offices. We’re seeing housing deals closed.