OTTAWA (Reuters) - There are not enough skilled workers to build the new apartments and homes needed to meet increasing housing demand in Canada's most populated provinces, the national housing agency said on Thursday.
The Canada Mortgage and Housing Corporation (CMHC) said a shortfall of skilled construction workers is a major challenge to addressing housing supply gaps that exist mainly in Ontario, British Columbia and Quebec.
Ontario, the most populous province and home to Canada's financial capital of Toronto, is projected to have more new households than new homes by 2030, the agency said.
"Labour capacity will be a big problem and it might make housing less affordable," the CMHC said in a report.
The agency has been studying Canadian housing affordability and said in June the country needs to build millions of new homes by 2030 to restore affordability.
"While the pandemic has shown that the workplace can pivot and manage greater construction volumes with fewer workers, this may still cause construction backlogs, which will create delays and postpone supplying new units to markets in need of more supply," the CHMC said.
Booming demand and low interest rates during the COVID-19 pandemic pushed home prices by more than 50%. Though prices have softened in recent months as the Bank of Canada sharply increased interest rates to curb high inflation, would-be-buyers are now being pushed out of the market due to higher mortgage qualifying rates.
In August, Prime Minister Justin Trudeau, describing housing affordability as a "complex problem" to solve, detailed plans to spend C$2 billion ($1.46 billion) toward rapid housing and a new rent-to-own program.
The Trudeau government has said it wants to double the homebuilding pace within a decade to tackle the housing affordability issue.
($1 = 1.3735 Canadian dollars)