The federal government's latest budget contains misleading housing data that fails to reflect the severe downturn in Canada's new home construction sector, according to industry analysis from the Building Industry and Land Development Association (BILD).
Budget Claims Versus Market Reality
When the 2025 federal budget was released on November 4, a single line on page 44 caught industry attention: "Home sales have risen in five of the past six months." This optimistic statement directly contradicts the alarming reality documented by third-party sales tracking agencies that have monitored builder data for decades.
Dave Wilkes, President and CEO of BILD, expressed confusion about how such a conclusion could be reached. "For those of us in Canada's housing industry, we found ourselves scratching our heads when we read this line," Wilkes noted, emphasizing that the budget's assertion "does not reflect the reality unfolding in major urban centres across the country."
Severe Sales Declines Across Major Markets
The actual numbers reveal a starkly different picture from the budget's positive portrayal. Year-to-date new home sales have declined dramatically compared to the 10-year average across Canada's largest housing markets.
The Greater Toronto Area and Greater Golden Horseshoe have both experienced devastating 82% and 81% drops in single-family and condominium apartment sales respectively. Other major markets show similar concerning trends:
- Vancouver: 67% decline
- Calgary: 40% decline
- Edmonton: 33% decline
- Montreal: 75% drop in condominium apartment sales
This represents not just a minor downturn but a severe industry-wide slowdown that began in the GTA over two years ago and has now spread to all housing types in all major Canadian markets.
Data Discrepancy Masks True Crisis
The discrepancy appears to stem from the federal government using total home sales data that includes resale homes rather than focusing exclusively on new home sales. This methodological choice creates a misleadingly positive picture that fails to track progress toward the government's own goal of building 500,000 new homes annually.
"You simply cannot track progress toward that goal using data from existing homes that have already been built, 10, 20, 50 or more years ago," Wilkes emphasized. If the aim is to spur new construction and add supply for a growing population, the focus must be on net new construction.
The budget's claim that "forward-looking indicators point to broadly balanced market conditions at the national level" further complicates the situation. New home sales today form the foundation for housing starts tomorrow, meaning current declines will translate into reduced construction 1.5 to 3 years in the future.
Real-World Consequences of Misleading Data
This statistical misinterpretation has tangible consequences for Canada's housing crisis. When the federal government assures Canadians that the market is "broadly balanced," it creates a false impression that there's no urgency to act.
Meanwhile, home building companies face a very different reality: evaporating sales, projects on hold, layoffs underway, and financing drying up. The six markets analyzed represent more than half of all Canada's new housing starts, making a "balanced" national picture difficult to reconcile with the data.
BILD and the Large Urban Centre Alliance have warned for months that new home sales have fallen to crisis levels. Not only will new homes for middle-class Canadians not get built, but approximately 100,000 jobs in the housing and construction sector are at risk.
Call for Urgent Policy Corrections
The industry is calling for immediate, practical measures to address the crisis, including:
- Extending the GST/HST exemption to all new home buyers, not just first-timers
- Following through on the promised 50% reduction to municipal development charges
- Honoring the commitment to implement a Multi-Unit Residential Building tax incentive program
Wilkes drew a sports analogy to illustrate the data problem: "If you want to know if the Leafs are winning, you don't watch the Raptors game. In order to ensure we have the right policies to support new home construction, we should be following new home sales and new home starts, not a broader measure that masks what's really going on."
With the federal government's ambitious goal of building 500,000 more homes annually within the next decade, using accurate data to measure success becomes critical. The current approach risks undermining both trust and the urgent action needed to address Canada's deepening housing supply crisis.
