OTTAWA, Feb. 16, 2026 — Canadian housing starts fell 15 percent in January compared with December, as reduced multi-unit construction pulled overall activity lower, according to data released Monday by Canada Mortgage and Housing Corp (CMHC). The decline marked a slower start to the year following stronger activity at the end of 2025 and underscored how sensitive construction volumes can be to shifts in financing conditions and project timing.

The seasonally adjusted annual rate of housing starts dropped to 223,589 units in January from 263,176 units in December. The decrease was driven primarily by fewer urban multi-unit projects, which include apartments, condominiums and townhouses. These segments account for a significant share of new supply in major cities, so changes in their pace can materially influence national totals. Single-detached construction remained more resilient during the month, limiting the overall decline and preventing a steeper contraction in headline figures.

Multi-Unit Projects Drive the Decline

Urban housing starts saw the sharpest pullback in January, with multi-unit projects accounting for most of the decrease. Developers broke ground on fewer apartment and condominium projects than in December, reversing part of the earlier momentum in that segment and contributing to the weaker monthly outcome.

Single-detached urban starts changed little, offering some offset but not enough to counter the broader slowdown. The divergence between multi-unit and single-family construction highlights how different housing categories respond to economic signals. Larger residential projects typically involve longer planning timelines and greater reliance on presales, making them more sensitive to changes in borrowing costs and investor sentiment.

Multi-unit projects often rely on presales and investor interest, both sensitive to financing conditions. Even modest changes in expectations can alter the timing of new developments, as builders reassess cost structures and projected returns. January’s figures illustrate that dynamic, with multi-unit activity exerting a disproportionate influence on overall construction levels.

Regional Activity Varies Across Canada

The monthly decline was not uniform across Canada. Some provinces recorded larger pullbacks, while others posted gains that softened the national drop and highlighted the uneven nature of construction activity across regions.

Ontario and British Columbia See Notable Pullbacks: Ontario and British Columbia, which together account for a large share of housing construction, saw notable decreases in multi-unit starts. Given their size and population density, changes in these provinces tend to have an outsized effect on national data. When activity slows in these markets, the national total often follows.

The pullback in multi-unit projects in these provinces weighed on overall figures, particularly in large urban centers where condominium and apartment construction represents a significant portion of new development.

Prairie Provinces Provide Partial Offset: In contrast, Prairie provinces recorded stronger activity during the month, helping cushion the overall figure and reflecting localized demand conditions. Gains in these regions did not fully offset declines elsewhere, but they moderated the scale of the national drop.

Regional economic factors and population trends continue to shape construction decisions. Areas with sustained housing demand saw developers proceed with projects, while higher financing costs tempered appetite elsewhere. This regional variation suggests that national totals can mask divergent patterns beneath the surface.

Six-Month Trend Shows Modest Cooling

CMHC reported that the six-month moving average of housing starts, which smooths monthly swings, edged down in January to 244,960 units from 249,031 units in December. Because housing data can fluctuate from month to month, analysts often rely on this rolling measure to gauge broader direction.

The dip in the trend measure indicates that the slowdown was not confined to a single reporting period. Instead, it reflects a gradual easing from the pace recorded late last year. While the change was modest, it points to softer momentum entering 2026.

Broader Housing Context

Canada’s housing sector continues to grapple with affordability challenges and supply constraints. Policymakers have encouraged higher levels of construction to address structural shortages, yet builders remain sensitive to borrowing costs, input expenses and projected sales volumes.

Higher interest rates over the past two years have weighed on both purchasers and developers. Although rates have eased from their peaks, financing remains more expensive than during the pandemic-era lows that spurred a surge in building activity.

January’s data show that housing starts have moderated after a period of stronger activity. The 15 percent monthly decline underscores that construction volumes can shift meaningfully from one month to the next, particularly when multi-unit projects change course. Even so, overall demand for new housing remains an underlying factor shaping the sector’s trajectory.