Canada must deliver 3.2 million net new housing units by 2035 to close the country’s supply gap, according to a new updated analysis by the Government of Canada’s Parliamentary Budget Officer (PBO).

That works out to about 290,000 net new homes per year — a pace the country has never sustained. Net new takes into account the homes that have been demolished to make way for new additional homes.

The report comes as household formation surges and then slows. After hitting a record 482,000 new households in 2024, the PBO projects a sharp decline in 2025 and 2026 due to recent federal policies curbing immigration. Household formation is expected to remain well below the historical average of 176,000 per year until 2030.

On the construction side, the PBO expects a short-term boost, with compl

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