Toronto and Vancouver Home Prices to Climb Sharply by 2032 If Supply Falls Short: Report
If the pace of new housing construction doesn’t accelerate significantly, median home prices could rise to $1.8 million in Toronto and $2.8 million in Vancouver by 2032, according to new research from Concordia University and private equity firm Equiton.
The study, led by Erkan Yönder, an associate professor at Concordia’s John Molson School of Business, leverages a neural network-based AI model to analyze vast datasets. It quantifies the additional housing supply needed in Canada’s largest cities to curb rising prices and provides detailed projections on how factors like approval delays and construction material costs impact housing development.
“We find that housing supply needs to be multiplied several times over — modest increases of 10 or 20 per cent just aren’t enough,” Erkan Yönder told Yahoo Finance Canada in an interview.
Canada’s housing shortage is a well-known issue and a key focus of national policy debates. Prime Minister Mark Carney’s election platform includes a pledge to double the rate of housing construction over the next decade. The Concordia research suggests that, based on Statistics Canada’s baseline population growth projections, doubling the pace of housing completions would have markedly different effects across cities — but could significantly slow or stabilize price growth in Toronto and Vancouver.
According to the report, Canada is currently completing new homes at a rate of about 1.75 per cent of existing dwellings per year. While doubling that pace is an ambitious goal, the authors say it is essential to tackling the country’s deepening affordability crisis, which they describe as a “generational issue” for Canadians.
In Toronto, the median home price is projected to rise from $1.4 million in 2024 to $1.8 million (in today’s dollars) by 2032 if the current rate of housing completions continues. However, doubling the pace of construction would slow that increase to $1.6 million. In Vancouver, the report notes that recent government efforts to curb immigration may cause a slight dip in prices this year, but under current building trends, the median price would still climb from $2.5 million to $2.8 million by 2032. A 50 per cent increase in completions would have little effect, the report says — only a full doubling would be enough to level off price growth.
The research also highlights the varied dynamics across Canada’s housing markets. While doubling housing supply could help contain price growth in Toronto and Vancouver, the model forecasts a different trajectory for Montreal.
“Even if you increase supply significantly in Montreal, you still can’t stop prices from rising,” Yönder said. He explains that the city sits on the “wrong side” of an inverted supply curve, where high demand continues to outpace new inventory. Montreal’s construction rate—just 1.19 per cent of its existing housing stock—is nearly half that of Vancouver’s 2.32 per cent. And with home prices still well below those in other major cities, Yönder adds, there’s simply “more room for prices to go up.”
"Tariff policies cannot be considered in isolation from housing supply. This is a connection policymakers need to take very seriously."
Calgary presents a different case. Unlike other major cities, its housing market is more sensitive to shifts in immigration and population than to supply levels. The model projects that home prices, which peaked at $740,000 in 2024 due to immigration-driven demand, will decline in the near term and stay below that peak regardless of construction rates.
The research also quantifies the benefits of cutting red tape and speeding up approvals. A 10 per cent improvement in a municipality’s score on the Regulation Index—a metric developed by the Canada Mortgage and Housing Corporation and Statistics Canada to assess zoning and regulatory hurdles—would lead to a 10 per cent increase in housing completions. Similarly, reducing approval timelines by 10 per cent would boost supply by 3 per cent. Yönder emphasizes that these gains come at no additional financial cost to governments.
“If you improve the regulation process and reduce delays, we can increase supply at no cost to the government,” Yönder said.
Conversely, the research shows that rising construction costs can have a dramatic effect. A 10 per cent increase in input costs can reduce housing completions by 25 to 35 per cent, with apartment projects bearing the brunt of the impact.
Yönder emphasizes that this ties Canada’s housing ambitions directly to global trade dynamics and tariff decisions. “Tariff policies cannot be considered in isolation from the housing supply,” he warned. “This is something to take very seriously.”
While regulatory challenges have long been part of the housing conversation, Yönder points out that this study is the first to quantify their impact. Understanding these policy levers is crucial, he argues, because of the sheer scale of the housing crisis.
When asked whether doubling housing completions is realistically achievable in a city like Vancouver, his response was blunt: “No. It’s not possible... It’s very costly. It’s very difficult.”
Still, Yönder sees value in the research as a tool for improving long-term planning. “In the end, we can make better decisions by projecting better,” he said.
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