Does Canadas Declining Birth Rate Mean More Housing Availability?

With the Canadian real estate market currently facing historically low sales activity, dropping property values, and growing inventory, many people have deluded themselves (and even some others) into believing that this is how things will be from now on and for many years to come.

They want to think that we will somehow witness a total reversal of decades of home price increases until we start seeing houses worth 20% of what they cost today.

Some pseudo-economists have even gone so far as to point at Canada’s declining birth rate, which is slated to stop keeping pace with our increasing death rate in 2030, as proof that our housing supply surplus will be even greater than it is currently.

But this is a foolish, inaccurate, and short-sighted way of thinking. So today, we will be busting the myth that Canada’s declining birth rate will mean more housing availability and affordability.

The Truth About Supply and Population

First of all, Canada’s property values have been increasing steadily for decades, despite short-term dips and spikes. The real estate market is cyclical, and we have seen market highs tempered by market lows and vice versa. In the long run, however, homes are absolutely essential and prove their resilient value over long periods of time.

The temporary jump in Canadian housing prices in 2022 may have resulted in a harsh correction in 2025, but we can still expect the market to readjust itself later and resume its steady decades-long climb based on how prices have increased for nearly 50 years.

Secondly, Canada’s population and economic growth have always relied heavily on immigration, which is still healthy and robust—to the point that we have needed to lower our previously too-ambitious immigration targets to achieve sustainable growth.

Our old 2023-2025 immigration plan brought in around half a million people annually, which caused a lot of stress to the housing market and infrastructure, as cities and provinces were unprepared for such a high rate of population growth. In fact, Canada hit a population milestone of 40 million people in 2023!

A serious adjustment was required, which is why the new 2025-2027 immigration plan reduced the population inflow by more than 20%. But this does not mean our population will shrink! Any nation in the world requires its population to grow by at least 1% each year in order to maintain its GDP growth.

Therefore, Canada plans to welcome just under 1% of its population as permanent residents and around 5% as temporary residents for the next three years, instead of the previous immigration rate of 1.25% permanent residents and 7.5% temporary residents. The country will adjust its immigration targets regularly, which is why Canada’s birth and death rates are not significant factors for the housing market.