Oh, Canada
As Toronto's experience shows, simply building more homes is not always the answer, writes Palma Oxley
Yimbyism – a movement which encourages people to say ‘yes in my back yard’ to housing and infrastructure, in opposition to the more familiar nimbys – has increasing influence on British planning policy. Its central argument for ensuring we “build baby, build” is that if housing supply goes up, housing prices will go down. This seems like basic economics, but it is not the full story. We need to be intentional about what we are building and who we are building it for – or else risk failing to meet local housing need and flooding the market with new homes that people can neither afford nor want to live in.
There are many places in the UK and overseas which demonstrate this point, but Toronto provides particularly important lessons. In 2016, developers started building masses of new ‘condos’ – similar to what we would call flats in the UK. In 2024, a record 25,572 new units were completed in the city, and over the last decade, condos have accounted for more than half of all new housing built in Toronto.
Toronto has also seen the rise of the mini-condo: very small units, typically under 600 sq ft, which keep headline prices low in high land value areas through a reduction in unit size. Mini-condos now account for 38 percent of condos built in the city, up from 8 percent before 2016.
Toronto has, in effect, “built baby, built”. But much of this supply has been designed to attract investors rather than to meet the needs of ordinary Torontonians. Condominiums are cheaper to build, but the quality is poor – 93 per cent of current condo occupants in the Greater Toronto Area feel that the city needs better-quality condos. And these condos are not aimed at families, but international students, digital nomads and other groups. According to Statistics Canada, investors own roughly 40 per cent of all condominiums in Toronto, and the majority of mini-condos in particular.
Since the housing market in Toronto has been tilted towards small, investor-friendly units, rather than family homes or long-term, high-quality rental properties, it has been made vulnerable to demographic changes. Stricter immigration policies mean that in 2025, Canada experienced the largest decline in its population since the 1940s (outside of Covid). Now, thousands of move-in ready units are sitting empty across the city and the wider area.
House prices in Toronto are declining in response to an increase in supply, but this has not translated into a meaningful improvement in affordability. Even after price declines, homes remain far beyond the reach of median earners. At the same time, weaker prices have led to a sharp contraction in housebuilding and thus fewer choices for buyers in the longer-term, as developers delay or cancel projects that are no longer financially viable.
The lesson from Toronto is that even a dramatic upsurge in certain types of proper-ties will not resolve the housing crisis unless the right kinds of homes – made to a high standard – are built in sufficient numbers. The housing minister, Matthew Pennycook, is right to argue for market reforms that address planning constraints and incentivise the construction of housing that genuinely caters to local need, rather than relying on price movements alone to restore afford-ability, quality, and security of tenure. If the government is serious about solving the housing crisis, it must move beyond simple headline supply figures. Our country must deliver 1.5m new homes, but ministers must focus on who they are for, how they are financed, and whether they are in places where people can build stable, flourishing lives. “Build, baby, build” may be a rallying cry. But unless it is paired with a commitment to build well and build for need, it risks failing to either reduce house prices or to improve lives.
