Ontario Pre-Construction Note: Rates Hold, Toronto's $2.7B Rental Push — August 2026

Market Note — August 7, 2026

A quiet policy backdrop and a large Toronto funding announcement framed the week for Ontario pre-construction buyers and investors. Here's a plain read on what matters, and where it intersects with the inventory we track on LIQWD.

Rates: still on hold at 2.25%

The borrowing picture didn't move this week. <cite index="7-1">The Bank of Canada held its target for the overnight rate at 2.25%, with the Bank Rate at 2.5% and the deposit rate at 2.20%.</cite> <cite index="2-3,2-4">The July 15 announcement kept the rate at 2.25% for a sixth consecutive time, with the Governing Council judging the current policy rate appropriate to sustain the economic recovery and bring inflation back to the 2% target.</cite>

For buyers timing a deposit or a closing, the calendar is the practical takeaway: <cite index="7-2">the next scheduled date for announcing the overnight rate target is September 2, 2026.</cite> If you carry a variable-rate mortgage, remember the mechanics — <cite index="4-11,4-13">the rate change immediately impacts your payments, and when rates go down your payments can drop.</cite> None of this is a forecast; it's simply the current rate environment against which pre-construction financing is being underwritten.

Toronto's $2.7B rental partnership

The week's headline was a joint federal–municipal commitment. <cite index="14-1,14-4">The federal government is investing at least $2.7 billion to build more than 18 housing projects across Toronto, with Prime Minister Mark Carney saying the funds will be invested over the next three years.</cite> <cite index="13-2">The projects will deliver more than 5,600 new rental homes, with shovels in the ground on more than 4,500 homes before the end of this year.</cite> On the affordability mix, <cite index="14-5">at least 1,800 of the new rental homes will be affordable or rent-controlled.</cite>

This is purpose-built rental, not for-sale condo supply, so it won't directly compete with most pre-construction ownership stock — but it signals continued public capital flowing into Toronto construction. On our platform, LIQWD's tracked inventory currently shows 121 active listed projects in Toronto, 24 of them newly listed in the last 30 days, with starting prices from $1,901 (deposit/entry figures vary by project). We're also tracking 47 active projects in Old Toronto, 34 of them new in the past month.

New-construction data still soft nationally

The supply data is the sobering counterpoint. <cite index="21-1">The six-month trend in housing starts was down in June compared to May, decreasing 2.8% to 248,123 units, according to CMHC.</cite> <cite index="24-8,24-9">Actual starts were down 13% year-over-year in centres with a population of 10,000 or greater, at 20,265 units in June 2026 compared with 23,292 in June 2025.</cite> CMHC's read is cautious: <cite index="20-4">the deputy chief economist said the environment is expected to hold back new construction over the short-to-medium term and drive 2026 actual starts below last year's levels.</cite>

Toronto ran against the national grain last month. <cite index="24-13">Toronto starts increased 25% due to higher multi-unit starts.</cite> The next data point lands soon — <cite index="20-11">CMHC will release the July housing starts data on August 18 at 8:15 AM ET.</cite>

Ontario context

At the provincial level, the pressure on new-build targets continues. <cite index="17-6,17-7">Figures in the November 2025 fall economic statement suggested Ontario would see 315,000 new housing starts from 2025 to 2028, but that figure dropped by more than 10% to 276,900 in the latest budget.</cite> The province has acknowledged the drag: <cite index="17-9">the 2026 budget stated that economic uncertainty has weighed on Ontario's housing market activity despite easing mortgage rates.</cite>

What we're seeing in tracked inventory

Beyond Toronto, LIQWD's tracked inventory shows active new-listing activity across the 905 this month:

• Brampton: 55 active projects (36 new in 30 days), from $419,990
• Richmond Hill: 40 active (25 new), from $399,990
• Oakville: 37 active (25 new), from $389,900
• Mississauga: 54 active, from $390,900 (fewer new listings this window)
• Markham: 41 active, from $661,990 (fewer new listings this window)

For cross-border watchers, we also track 55 active projects in Miami (from $300,000). These are our platform's tracked figures, not whole-market totals.

The through-line this week: financing conditions are steady, public money is moving into Toronto rental supply, and national starts remain weak while Toronto multi-unit runs ahead. Buyers should confirm project-specific deposit structures, occupancy timelines, and financing terms directly with each builder before committing.

Sources

• https://www.bankofcanada.ca/2026/07/fad-press-release-2026-07-15/
• https://www.nesto.ca/mortgage-basics/bank-of-canada-interest-rate-schedule/
• https://www.rbcroyalbank.com/en-ca/my-money-matters/money-academy/economics-101/understanding-interest-rates/bank-of-canada-interest-rate-announcement/
• https://canada.constructconnect.com/dcn/news/government/2026/08/carney-promises-2-7-billion-to-build-rental-homes-in-toronto
• https://www.renewcanada.net/feds-toronto-announce-new-partnership-securing-up-to-2-7b-to-build-new-homes/
• https://www.newswire.ca/news-releases/housing-starts-and-construction-data-for-june-2026-882510300.html
• https://www.cmhc-schl.gc.ca/professionals/housing-markets-data-and-research/housing-data/data-tables/housing-market-data/monthly-housing-starts-construction-data-tables
• https://www.cmhc-schl.gc.ca/media-newsroom/news-releases/2026/housing-starts-june-2026
• https://globalnews.ca/news/11747370/ontario-housing-budget-2026/