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Canada's new immigration policy aims to reduce population growth by limiting the influx of temporary residents (TRs), which will have varying effects across provinces. Regions like British Columbia (BC) and Ontario, with high concentrations of TRs, are likely to see the most immediate impact on housing costs as their population growth slows. Provinces with fewer TRs, such as Atlantic Canada and Alberta, may experience a buffer period, although broader effects could still emerge over time.

BMO economist Robert Kavcic highlights that the revised immigration target, aiming for a 5% TR share nationally, will primarily affect BC and Ontario, where TRs currently make up a significantly larger share of the population. In particular, temporary foreign workers (TFWs) constitute a substantial portion in these provinces, with BC leading at 4.8%. The policy shift will likely lead to a cooling effect on housing demand in regions heavily dependent on TRs, as visa processes tighten and low-wage TFWs face restrictions.

As population-driven demand moderates, BC and Ontario's rental markets may feel immediate downward pressure, with lower rents and slower housing starts expected. Atlantic Canada, which has seen rising real estate prices due to interprovincial migration, may also feel shifts if young adults—historically driven by affordability—find less incentive to relocate. This gradual shift in housing demand could rebalance some of Canada’s regional real estate dynamics in the coming years.

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