New Canadian research ties increasing homelessness to high rent and low vacancy in lowest-cost rental housing

AUGUST 6, 2026 — Homelessness in Canada is a housing problem, and it’s getting worse, according to new research released today by the Canadian Alliance to End Homelessness (CAEH). The new research – the first of its kind in Canada – demonstrates a clear link between housing affordability, vacancy rates, and increasing homelessness.

Homelessness in Canada has doubled since 2018, despite significant increases in investment and funding of affordable housing from many levels of government.

The report’s findings show that homelessness increased most in communities where the lowest-cost rental housing became more expensive and less available and rental market conditions for those lowest-cost units are getting worse across the country, meaning homelessness is expected to worsen.

“Surging homelessness in Canada has been driven by a lack of deeply affordable housing,” said CAEH President and CEO Tim Richter. “Canadians cannot afford to rent even the cheapest units in their community, and the affordability gap is growing, pushing more people into homelessness.”

The new research builds off landmark research by U.S. authors Gregg Colburn and Clayton Page Aldern in Homelessness is a Housing Problem, which found a causal relationship between the affordability and availability of rental housing and homelessness rates across American cities. When rents rise and vacancy rates fall, rental housing becomes more competitive and homelessness tends to increase.

CAEH’s analysis investigated the relationship between homelessness rates and rental market conditions in 36 Canadian communities to better understand the structural drivers of the crisis.

Communities that saw the largest increase in rent prices and shrinking vacancy rates for the lowest-cost rental units tended to have the largest increase in homelessness.

For example, Hamilton experienced a significant tightening of market conditions for their lowest-cost rental units from 2018 to 2024, with vacancy rates dropping from 2.3% to 1.2%, and rental prices increasing by 47% to nearly $1,200 per month. That price increase rapidly outpaced the 18.9% growth in median single-person incomes for Hamilton residents. At the same time, there was a 224% increase in homelessness in Hamilton from 2018 to 2024, according to their Point-in-Time (PiT) Counts.

Three-quarters of the 36 communities saw their lowest-cost rental units become more expensive from 2018 to 2024. In two-thirds of communities studied, the average low-cost rental price was more than double what would be reasonably affordable for single adults with the low incomes in 2023.

Without action, homelessness will continue to increase, as rental market conditions for the lowest-cost units continue to worsen.

“The logical conclusion from these findings is that solving homelessness requires addressing the housing needs for the lowest income Canadians. Current efforts  just aren’t reaching those who need it most. With a new national housing strategy being released in the coming months, these findings confirm the urgent need for investment in deeply affordable housing and homelessness prevention,” Richter added.

Among their recommendations for the next national housing strategy, CAEH is recommending a transformed Canada Housing Benefit to provide immediate relief to the lowest-income Canadians and reduce homelessness; at the same time as working to double the supply of social and deeply affordable housing to reduce costs at the low-end of the market longer-term.

Scroll down or click here to read the preliminary findings.

Read more information on the Canadian Alliance to End Homelessness’ recommendations for the next national housing strategy here.