More rental housing development needed despite recent rise: RBC economist

Even though rental housing construction in Canada has picked up significantly, more is needed to fill the demand backlog, according to a new RBC report.

RBC economist Rachel Battaglia said rental housing starts reached their highest levels in decades in 2022 and 2023, with more than 80,000 new units started each year.

"That number is set to rise even more in 2024 as surging demand and new policy measures tip the scale for developers despite persistently high inflation challenges and skilled labour shortages," she wrote in a report published Wednesday. 

Housing starts are already up 11 per cent from last year, said Battaglia, with anticipated interest rate cuts from the Bank of Canada set to keep that trend on track.