Insights & Resources

Affordability requires sustained gains in housing starts

The Canada Mortgage and Housing Corporation announced that housing starts jumped 10.9% to 282,439 units (seasonally adjusted annual rate – SAAR) in December. This is up from November’s revised 254,625-unit level (originally reported as 254,058). The overall move during the month was led by a 14.4% advance in multi-unit starts. Single-detached starts actually reported a modest 1.9% decline. These figures have recently seen considerable volatility, and the overall December level is the highest since July 2025. As can be seen in the accompanying graph, however, CMHC’s six-month trend level (which tends to smooth the results) edged lower to 264,428 in the December report. The move down from the revised November trend level (264,716) came despite the remarkable one-month advance. As well, Canada’s population growth (working age individuals shown) had surged from 0.8% (year-over-year) in March 2021 to a recent peak of 3.6% in October 2024. This was the most rapid population growth on records dating back to 1977. Still, a modest slowdown in this growth has now been seen. Regardless, while the interest rate cuts from the Bank of Canada seen in 2024 and 2025 have had some influence on affordability, the persistent shortfall in housing availability
remains.

U.S. productivity gains continue

The U.S. Bureau of Labor Statistics announced that non-farm labour productivity expanded by 4.9% (annualized) during the third quarter of 2025. This move up comes on the back of a similar 4.1% gain in the second quarter. Output per hour for all non-farm workers recorded a new record high during the third quarter and stood with a gain of 1.9% compared to the same period in 2024.

Productivity growth is important for longer-term economic stability as it reflects a country’s competitiveness, allows for higher wages, faster economic growth without inflationary pressures, and a higher standard of living. The U.S. figures, which continue to show steady gains, paint a stark contrast when compared to Canada. Since the fourth quarter of 2014, U.S. productivity has achieved a cumulative 21.5% improvement. Over the same period Canadian productivity has increased by 4.5%.

Longer view

Hundreds of billions of dollars have been invested in artificial intelligence with the goal of boosting productivity, enhancing quality of life, and improving health outcomes. These investments are poised to yield tangible benefits beginning in 2026, with positive impacts expected to unfold over the next decade.

As with any transformative shift, the early stages may bring discomfort and disruption. However, through thoughtful adaptation and strategic modifications, the advantages of AI integration will become increasingly clear. AI has the potential to reshape industries and daily life alike.

Crucially, the productivity gains driven by AI should help ease labour inflation pressures and support stronger earnings growth. As businesses become more efficient and individuals more empowered, the long-term economic and societal benefits could be profound.

Important Disclaimers

This document is intended solely for information purposes. It is not a sales prospectus, nor should it be construed as an offer or an invitation
to take part in an offer. The opinions expressed in the communication are solely those of the author(s) and are not to be used or construed as investment advice or as an endorsement or recommendation of any entity or security discussed. This report may contain forward-looking statements about one or more pools, future performance, strategies or prospects, and possible future fund action. These statements reflect the portfolio managers’ current beliefs and are based on information currently available to them. Forward-looking statements are not guarantees of future performance. We caution you not to place undue reliance on these statements as a number of factors could cause actual events or results to differ materially from those expressed in any forward-looking statement, including economic, political and market changes and other developments. Every effort has been made to ensure that the material contained herein is accurate at the time of publication. Market conditions may change which may impact the information contained in this document and it is subject to change without notice. The author and/or a member of their immediate family may hold specific holdings/securities discussed in this document. Any opinion or information provided are solely those of the author and does not constitute investment advice or an endorsement or recommendation of any entity or security discussed or provided by CI Global Asset Management. We cannot guarantee its accuracy or completeness and we accept no responsibility for any loss arising from any use of or reliance on the information contained herein. The pools used in the CI Private Wealth portfolios are managed by CI Global Asset Management. Management fees and expenses may all be associated with investments in the CI Private Wealth portfolios and the use of other services. The pools used in the CI Private Wealth portfolios are not guaranteed, their values change frequently, and past performance may not be repeated. You should seek professional advice before acting on the basis of information herein. CI Global Asset Management is a registered business name of CI Investments Inc. Certain names, words, titles, phrases, logos, icons, graphics, or designs in this document may constitute trade names, registered or unregistered trademarks or service marks of CI Investments Inc., its subsidiaries, or affiliates, used with permission. All other marks are the property of their respective owners and are used with permission. Certain statements contained in this communication are based in whole or in part on information provided by third parties and CI Global Asset Management has taken reasonable steps to ensure their accuracy. Market conditions may change which may impact the information contained in this document. This report may not be reproduced, in whole or in part, in any manner whatsoever, without prior written permission of CI Private Wealth.