Ontario Pre-Construction Note: Rates, Rentals & Supply

This Week in Ontario Pre-Construction

Three things matter for pre-construction buyers this week: where borrowing costs sit, a large federal-city rental financing deal in Toronto, and the direction of national housing starts. Here's what's confirmed — and how it lines up with LIQWD's tracked inventory.

Rates: another hold at 2.25%

Carrying a deposit-to-closing plan starts with the policy rate. On July 15, 2026, the Bank of Canada held its interest rate at 2.25% — its sixth consecutive decision to leave the overnight rate target unchanged. The next announcement is scheduled for Wednesday, September 2, 2026.

The practical takeaway for buyers is stability, not direction. The BoC rate affects mortgage payments differently by type: a variable-rate mortgage feels the change immediately, while a fixed-rate mortgage feels it at renewal, since the rate holds until the term ends. If you're mapping a closing 12–36 months out, stress-test your qualifying assumptions rather than count on a specific rate at closing.

Toronto's $2.7B federal-city rental deal

The week's biggest supply story is a financing partnership. On August 5, 2026, the City of Toronto and the Government of Canada announced Toronto is receiving up to $2.7 billion to accelerate housing supply and support new purpose-built rental housing.

That money backs 18 rental housing projects across the city over the next three years, expected to produce more than 5,600 rental homes — spanning affordable, supportive, rent-geared-to-income, and rent-controlled units.

The funding runs through two channels:

• Non-market: Build Canada Homes will contribute more than $310 million toward nine projects on City-owned land, producing close to 1,900 rental homes.
• Market: The other nine projects draw more than $1.8 billion under CMHC's Apartment Construction Loan Program — across downtown Toronto, Leaside, Flemingdon Park, the Junction Triangle, Scarborough and Weston — expected to create 3,720 units, 1,079 of them affordable.

Construction is slated to begin on more than 4,500 of these homes before the end of 2026. As Carney put it, the projects are "not luxury condos but rather places people can afford." That's the key context: this is rental and affordable supply, not a condo pre-sale pipeline. It matters to investors weighing future rental competition — but it isn't a launch list for individual pre-construction purchasers.

Housing starts: national trend still soft

CMHC's most recent release covers June. The six-month trend in housing starts fell 2.8% from May, to 248,123 units. The monthly figure moved the same way: the seasonally adjusted rate came in at 238,971 units in June, down from 253,083 in May.

Toronto ran against the national grain. Vancouver posted a 35% decrease on lower multi-unit and single-detached starts, while Toronto starts rose 25% on higher multi-unit starts. CMHC's own outlook stays cautious: it expects the current environment to hold back new construction over the short-to-medium term and drive 2026 starts below last year's levels. The next data point lands soon — CMHC releases July housing starts on August 18 at 8:15 AM.

What LIQWD's tracked inventory shows

Across LIQWD's platform as of August 12, 2026, activity is concentrated but uneven. Our tracked inventory lists 121 active projects in Toronto (9 newly listed in the last 30 days, starting from $1,901) — the most of any market we cover.

The 905 and suburban markets are stable but quiet on new supply. Each of these showed 0 new listings in the past 30 days:

• Brampton — 55 projects, from $419,990
• Mississauga — 54 projects, from $390,900
• Old Toronto — 47 projects, from $350,990
• Markham — 41 projects, from $661,990
• Richmond Hill — 40 projects, from $399,990

Oakville (37 projects, from $389,900) added 1. Outside Ontario, our Miami count (55 projects, from $300,000) led on new activity with 16 fresh listings. These are LIQWD's own tracked project counts, not total market supply.

The pattern to watch: new launch activity in our data stays centred on Toronto proper, while established 905 markets hold rather than add. Pair that with a steady policy rate and soft national starts, and the near-term signal is to focus on deal-level diligence — deposit schedules, closing costs and comparable pricing — over broad market timing.

This note is informational and not financial advice. It does not promise or forecast returns.

Sources

• https://www.rbcroyalbank.com/en-ca/my-money-matters/money-academy/economics-101/understanding-interest-rates/bank-of-canada-interest-rate-announcement/
• https://tradingeconomics.com/canada/interest-rate
• https://www.toronto.ca/news/city-of-toronto-government-of-canada-announce-new-partnership-securing-up-to-2-7-billion-to-build-new-homes/
• https://storeys.com/federal-government-toronto-rentals-deal/
• https://www.cp24.com/local/toronto/2026/08/05/carney-promises-27-billion-to-build-rental-homes-in-toronto/
• https://www.cbc.ca/lite/story/9.7297009
• https://www.newswire.ca/news-releases/housing-starts-and-construction-data-for-june-2026-882510300.html
• https://canada.constructconnect.com/dcn/news/economic/2026/07/cmhc-reports-annual-rate-of-housing-starts-in-june-down-six-per-cent-from-may
• https://www.cmhc-schl.gc.ca/media-newsroom/news-releases/2026/housing-starts-june-2026