OTTAWA–Housing starts in Canada are set to decline over the next three years due to higher construction costs, weaker demand and elevated levels of unsold inventory, the country’s housing agency said Wednesday. The outlook from Canada Mortgage and Housing Corp. represents another setback for the country’s residential real-estate sector, where prices and sales have declined following a prolonged period of strength fueled by immigration. It’s also a sign that, unlike in the recent past, housing-market activity won’t help propel the Canadian economy into a higher gear. Canada’s economy is struggling with slow growth, with manufacturers under duress from hefty U.S. tariffs. Furthermore, firms are scaling back spending and hiring plans as the future of a North American trade treaty is in doubt. CMHC said in a report that it expects housing starts to drop during the 2026-to-2028 period. [See video of CMHC Chief Economist]