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New housing in Ontario stuttered slightly last month after a relatively strong start to the year, with the province still far away from its one-time goal of 1.5 million new homes by 2031.
Data from the Canadian Mortgage and Housing Corporation revealed a national drop in housing starts for May of roughly five per cent compared to 2025.
Ontario’s local figures recorded a three per cent drop, with work beginning on 5,661 new units over the past month, compared to 5,866 in May 2025.
The annual totals are still far better this year, with 18 per cent more housing started in 2026 than in 2025.
Despite the stronger performance, Ontario remains far adrift from its stated goal of building 1.5 million new homes between 2022 and 2031.
To date, the province has begun work on 26,084 new units this year; it has a target of 175,000 new homes in 2026. The current pace means 42 per cent of the year has elapsed and Ontario has only achieved 15 per cent of its target.
The Ford government has overseen a flailing housing industry for years.
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First, Premier Doug Ford blamed rising interest rates for the lack of housing, promising new homes would sprout “like mushrooms” if rates dropped.
But when the cost of borrowing fell, the housing market didn’t rebound. Ford suggested the cost of building approvals and permits from cities was to blame, an issue his administration has repeatedly tried to address through legislation.
Ontario then unveiled a new home tax incentive for first-time buyers. A couple of months after it was introduced, the premier said he knew it wouldn’t work, suggesting it needed to be expanded.
As part of the 2026 budget, the Ford government expanded that offer to apply to all new homebuyers in the province. It also partnered with the federal government to reduce the development charges paid by homebuilders.
Those measures, Housing Minister Rob Flack has said, have led to a sharp spike in demand for new homes.
“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,” Flack recently said in the legislature.
“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.”
Despite the buzz, the Ford government is still massively struggling to hit its 1.5 million new homes goal.
As part of the push, it assigned housing targets to major municipalities, offering financial incentives to towns and cities that hit their targets.
Even after adding basement units, long-term care beds and student residences for 2024, the province only achieved 80 per cent of its 125,000 goal last year.
The goal target for 2025 was 150,000; it is 175,000 per year now until 2031.
The government acknowledged late last year that its own goal is likely impossible, with the finance minister calling it a “soft target.”
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