The Parliamentary Budget Office (PBO) has analyzed that the federal government’s reduction in immigration will have a smaller impact on solving the housing shortage than the government had anticipated.
The PBO said the new immigration plan would have a smaller impact on solving the housing shortage than the government had anticipated and would be about 45% lower than previously projected. However, it questioned the government’s population projections, warning that it is unclear whether non-permanent residents will leave Canada as expected.
The PBO pointed out that it is uncertain whether some non-permanent residents will leave Canada, which could affect the housing shortage projections. The Liberal government announced a plan to reduce immigration between 2025 and 2027, arguing that this would improve Canada’s housing shortage.
Accordingly, the PBO estimated that 1.2 million additional housing units would need to be built by 2030 to solve the housing shortage. However, the PBO assessed that the government’s projections may be overly optimistic, adding that given the detailed departure projections and regional differences up to that point, it would take more time to solve the housing shortage.
The PBO pointed out that the government’s predictions of non-permanent resident departures were not realistic and could vary by region. On the other hand, it acknowledged that reducing immigration could help housing supply in the short term.
While it acknowledged that reducing immigration as planned by the government would have a positive impact on housing supply, it said the outlook for this was still uncertain.
Federal Immigration Minister Mark Miller stressed that immigrants would continue to play a vital role in solving the housing shortage, saying that immigrants were not the cause of the housing crisis and that everyone should be supported to settle successfully.