By Tom Parkin
January 26th, 2026
BURLINGTON, ON
A turning point? Private investment in Ontario housing shows life in November
Eventually, a lack of construction will cause housing prices and rents to climb again, shifting the policy debate. But the data isn’t clear if Ontario is at that point yet.
Ontario private housing investment turns sharply up in November
For over three years the post-bubble collapse of Ontario housing rents and prices has sent private investors to the sidelines, crushing housing starts and tens of thousands of residential construction jobs.
But Statistics Canada data released Wednesday, January 21 shows capital investment in Ontario housing construction turned sharply up in November, surpassing the previous peak in 2022 and maybe signaling investment managers think a return to rising rents and prices is on the horizon.
Tighter supply as private and public investment sit it out
During the three year private capital hiatus the Ontario government has also remained firmly on the sidelines, providing no direct construction capital, discount borrowing facility or injection into non-profit or co-op housing corporations.
Rather, its PC masters have constrained the Ontario government, limiting state-led action to a series of fiddles to lower investment taxes, cut approval processes and reduce affordability requirements.
The result has been record low housing construction, tightening housing markets and hedging against even deeper price and rent drops.
Shift from homeownership to rental
Permit data continues to show private capital’s return is to construct corporate apartment buildings and not for condos and single-dwelling housing, which can be occupied by its owner. This investment direction is taking Ontario toward reduced homeownership and less home purchase choice.
Investment in apartment rental is reducing home ownership choices
When turn comes, be ready for policy debates to shift
If November’s investment increase is the beginning of a sustained return by private capital, the threat of systemic finance damage caused by underwater mortgages and the condo crash may shift from small to remote. And if that threat disappears, to be replaced by the threat of higher prices and rents, the policy debate might advance to ways to maintain the price correction after the disastrous 2020-2022 unchecked price run-up.
While housing investors will no doubt fight policies to maintain lower rent and prices, falling household consumption, weak retail store purchases and stalled GDP growth provide strong economic arguments for protecting affordability. Allowing household incomes to be swallowed by housing costs is not a “Buy Canada” strategy.
While that debate lies somewhere ahead, other recent data suggests it’s not imminent.
November investment data echoed October building permit data, both showing an upswing. But investment reported on building permits fell from October to November (chart below), suggesting the November investment bump was not sustained and the report on December investment will show a return to decline.
So while constricted housing supply in the context of stable interest rates will eventually drive prices and rents higher, that time may not have arrived yet. Building permit and investment data for December release on February 11 and 18, respectively, perhaps clarifying if investors feel a price bottom has be found, and a new policy debate is on us.
Building permit data
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