The Magic Formula: Ontario Should Follow Alberta’s Lead on Housing

Why It Matters

Ontario’s lagging construction threatens affordability and drives talent out of the province, while Alberta’s policy mix shows how regulatory and tax reforms can boost supply and stabilize markets.

Key Takeaways

• Alberta recorded 54,858 housing starts in 2025, a 15% rise
• Ontario housing starts fell 12% to 65,376 units in 2025
• Ontario’s development charges rose over 5,000% in Toronto in 25 years
• Alberta’s lower fees and no provincial sales tax cut home costs
• Experts urge Ontario to digitize approvals and adopt off‑site construction

Pulse Analysis

Ontario’s housing market faces a perfect storm of dwindling starts, soaring development charges and a tax structure that adds roughly 36% to new‑home prices. CMHC data shows a 12% decline in provincial starts last year, while Toronto’s price‑to‑income ratio now exceeds seven times median income. The federal‑Ontario pledge to eliminate HST on homes under $1 million (about $740,000 USD) and a $8 billion CAD (≈$5.9 billion USD) infrastructure fund aim to blunt cost pressures, yet these measures alone will not reverse the trend without structural change.

Alberta offers a contrasting playbook. By stripping away burdensome municipal fees, accelerating approval timelines and forgoing a provincial sales tax on housing, the western province lifted its housing starts to a record 54,858 in 2025. The policy mix—clear provincial mandates for municipalities, collaborative industry dialogues and a "can‑do" regulatory mindset—has translated into faster, cheaper construction and a 15% year‑over‑year growth. The Alberta model demonstrates that targeted tax relief and regulatory certainty can unlock private‑sector capacity, delivering tangible supply gains even amid broader economic headwinds.

For Ontario to close the gap, policymakers must move beyond temporary tax tweaks. Digitizing planning approvals, embracing off‑site and modular construction, and leveraging PropTech to identify viable sites can cut multi‑year delays that currently plague developers. A three‑year suspension of land‑transfer taxes on new, never‑occupied homes would further lower entry costs. Coupled with sustained reductions in development charges, these reforms could restore builder confidence, increase supply, and ultimately bring housing affordability back within reach for Ontario’s growing families.