Analytical Studies: Methods and References
A Framework for Projecting Housing Use Associated with Immigrants and Non-Permanent Residents
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Acknowledgements
This is a joint study conducted by Immigration, Refugees and Citizenship Canada and Statistics Canada. The authors would like to thank Chantal Goyette and Radu Pârvulescu for their advice and comments on an earlier version of this article.
Abstract
Recent changes in Canada’s immigration levels have heightened interest in understanding how immigration affects housing demand. This article develops a methodological framework for projecting housing use associated with permanent residents (PRs) and non-permanent residents (NPRs) under alternative immigration scenarios. The framework applies observed per capita housing use rates from the Census of Population to estimate incremental housing use by tenure over time. The approach distinguishes between one-step PRs, who are admitted directly from abroad and use housing immediately at admission, and two-step PRs, who transition from NPR status and are typically already housed. It also accounts for active residence in Canada, using tax filing behaviour as a proxy, and for changes in housing use with years since admission as immigrants transition from primarily rental housing to homeownership. Housing use associated with NPRs is modelled using a stock-based approach that reflects year-over-year changes in the NPR population, accounting for transitions to PR status.
By incorporating immigrant-specific housing use patterns, two-step immigration, non-residence and the contribution of earlier admission cohorts, the framework produces housing use estimates that differ substantially from simpler per capita approaches based on average household size. The model provides a flexible tool for assessing housing use pressures associated with immigration under recent occupancy patterns and for conducting policy-relevant scenario analyses.
Introduction
Recent changes in Canada’s immigration levels and composition have intensified attention on the relationship between population growth and housing demand. In 2023, Canada’s population increased by 3.2%, the highest annual growth rate since 1957, driven largely by the addition of 805,000 non-permanent residents (NPRs) and 472,000 new permanent residents (PRs) (Statistics Canada, 2024). This rapid population growth heightened concerns about additional pressure on housing markets, particularly in larger urban centres. By contrast, in the second half of 2025, Canada’s population declined as government measures to reduce the number of NPRs began to take effect (Statistics Canada, 2025). This population decline coincided with easing conditions in some major housing markets. While changes in immigration and NPR levels are expected to influence housing use in the rental and ownership markets, studies quantifying how immigration policy changes translate into housing needs associated with population shifts are limited.
In response to growing concerns about the imbalance between housing supply and demand, the Government of Canada’s 2025–2027 Immigration Levels Plan explicitly linked immigration targets to housing demand, noting that reductions in immigration levels were intended “to lessen pressures on services and housing” (Government of Canada, 2025a). Budget 2025 also highlighted the unprecedented pace of recent immigration growth and its implications for housing supply, health care and education systems. It emphasized the importance of “a sustainable immigration rate” and announced further reductions in temporary resident arrivals under the 2026–2028 Immigration Levels Plan (Government of Canada, 2025b). These policy developments further underscore the need for analytical frameworks that can translate changes in immigration levels into projected housing use associated with immigration.
Previous research has documented important differences in housing use between PRs, NPRs and Canadian-born individuals. Using data from the 2021 Census of Population, Zhang and Hou (2025) estimated owned and rental housing use per 1,000 PRs and NPRs. Their study showed that PRs’ housing use evolves with years since admission and varies by dwelling type and community size across the rental and ownership markets. While these estimates provide a snapshot of housing use at a point in time, they do not directly address how housing use may change under alternative immigration scenarios.
Projecting housing use associated with immigration requires accounting for several dynamic factors. Immigration affects housing use not only through new arrivals, but also through the continued presence and housing trajectories of earlier admission cohorts. In addition, a substantial share of new PRs are admitted through two-step immigration pathways, having previously resided in Canada as NPRs, reducing their immediate housing use as new PRs. Furthermore, not all admitted PRs require long-term housing in Canada, as some are not actively residing in the country. Housing use also differs systematically by immigrant status and changes as immigrants spend more time in Canada (Pârvulescu, 2025; Zhang & Hou, 2025).
This article presents a methodological framework for projecting housing use associated with PRs and NPRs under alternative immigration scenarios. Similar to modelling frameworks developed to assess the effect of immigration on education systems (Bonikowska et al., 2025), the method builds on observed per capita housing use from census data, distinguishes between new and earlier admission cohorts, incorporates two-step immigration and PR retention, and allows the effects of changes in immigration levels to be scaled to different policy scenarios. By explicitly modelling PRs and NPRs, the framework captures differences in housing use between the ownership and rental markets.
The article describes the assumptions, data sources and analytical steps used to project housing use arising from immigration trends. The framework is intended as a flexible tool to support policy-relevant “what-if” analyses, such as changes in PR admissions or NPR populations. By linking immigration dynamics to housing use patterns, the approach provides a basis for assessing the potential short- and medium-term implications of immigration policy changes for housing use at the national level and across communities.
Analytical framework for projecting housing use associated with immigration
Overview
The objective of the modelling framework is to estimate how changes in immigration levels—among PRs and NPRs—translate into changes in housing use over time. Housing use is expressed in terms of the number of housing units required to maintain recently observed levels of housing occupancy by immigrant status. The approach isolates the marginal effect of immigration on housing use, abstracting from changes in housing supply, prices or affordability, and housing behaviours.
The modelling framework accounts for differences in housing use across immigrant groups and the contribution of earlier admission cohorts to current and future housing use. While new arrivals use housing immediately, earlier cohorts of immigrants continue to contribute to housing use, as their housing use evolves over time. As a result, housing use in a given year reflects the cumulative contribution of multiple admission cohorts. The model produces estimates of housing use by tenure (ownership and rental) and can be extended to examine differences by dwelling type and community size.
The framework incorporates two key analytical considerations: immigrants requiring new housing, and housing use rates at admission and over time.
Immigrants requiring new housing
Changes in immigrant housing use depend on changes in the immigrant population that requires new housing. This requirement may vary depending on how many new PRs were previously NPRs and how many actively reside in Canada.
One-step PRs (those admitted directly from abroad) use new housing immediately at the time of admission, whereas two-step PRs (those who transitioned from NPR status) are typically already housed, having lived in Canada prior to obtaining PR status. Their housing use may also evolve differently following admission. For these reasons, distinguishing between one-step and two-step PRs is important.
The 2025–2027 Immigration Levels Plan anticipated that more than 40% of PR admissions in 2025 would consist of individuals already residing in Canada as temporary residents (Immigration, Refugees and Citizenship Canada, 2024). This projection is consistent with recent trends: the share of new PRs who were former temporary residents rose from 23% in 2010 to 37% in 2019, increased sharply to 69% in 2021 during the COVID-19 pandemic, and remained at 46% in 2023 and 2024. This share is expected to increase further in 2026 and 2027, reflecting planned one-time initiatives to grant permanent residence to approximately 115,000 eligible protected persons in Canada and to accelerate the transition of up to 33,000 work permit holders to permanent residence (Government of Canada, 2025c).
Data table for Chart 1
| Year of admission | Percent |
|---|---|
| Source: Statistics Canada, Longitudinal Immigration Database. | |
| 2000 | 18.2 |
| 2001 | 16.3 |
| 2002 | 15.1 |
| 2003 | 15.7 |
| 2004 | 19.1 |
| 2005 | 20.0 |
| 2006 | 22.7 |
| 2007 | 23.3 |
| 2008 | 23.2 |
| 2009 | 24.2 |
| 2010 | 23.0 |
| 2011 | 23.6 |
| 2012 | 25.4 |
| 2013 | 26.9 |
| 2014 | 34.1 |
| 2015 | 33.2 |
| 2016 | 30.0 |
| 2017 | 37.9 |
| 2018 | 37.3 |
| 2019 | 36.9 |
| 2020 | 47.4 |
| 2021 | 69.2 |
| 2022 | 41.5 |
| 2023 | 45.6 |
| 2024 | 45.6 |
Not all admitted PRs actively reside in Canada, and the likelihood of active presence declines with years since admission. Individuals who are not actively present in Canada should be excluded from the population contributing to housing use. In this study, the filing of personal income tax returns among prime-aged immigrants is used as a proxy for active residence in Canada (Hou, 2024). As shown in Chart 2, among immigrants admitted from 2000 to 2019 who were aged 25 to 54 at admission, an average of 92% of two-step immigrants filed income taxes in the first full year after admission, declining to 82% 10 years after admission. Estimated filing rates among one-step immigrants were 88% in the first full year and 80% 10 years after
Data table for Chart 2
| Years since admission | One-step permanent residents | Two-step permanent residents |
|---|---|---|
| percent | ||
| Source: Statistics Canada, Longitudinal Immigration Database. | ||
| 1 | 88.0 | 91.7 |
| 2 | 88.0 | 91.0 |
| 3 | 88.0 | 90.4 |
| 4 | 87.9 | 89.6 |
| 5 | 85.5 | 87.6 |
| 6 | 84.5 | 86.5 |
| 7 | 83.3 | 85.4 |
| 8 | 82.1 | 84.3 |
| 9 | 80.8 | 83.2 |
| 10 | 79.6 | 82.1 |
For NPRs, the modelling framework assumes that changes in housing use are driven by changes in the planned stock of NPRs, accounting for reductions resulting from transitions to PR status. The assumption is based on the observation that most NPRs do not maintain temporary resident status beyond three years after their initial arrival, as some transition to permanent residence and others do not renew their temporary resident permits (Lu & Hou, 2025). For example, if the planned stock of NPRs is projected to decrease by 450,000 from one year to the next and 150,000 of this decline reflects NPRs transitioning to PR status, the net reduction in NPRs contributing to housing use is assumed to be 300,000. For the remaining 150,000 individuals who transition to permanent residence, the model separately captures their additional housing needs associated with the transition from temporary to permanent residence status by years since admission.
Housing use rates at admission and over time
Housing use is measured using per capita housing occupancy rates derived from the Census of Population. Following Zhang and Hou (2025), housing use is defined as the number of occupied housing units per 1,000 individuals, calculated separately for owned and rented dwellings. These rates reflect observed housing occupancy under prevailing market conditions at the time of the census and are held constant in the projections.
Because housing occupancy is measured at the household level and a household is defined as either a single individual or a group of individuals living in the same dwelling, the number of dwellings occupied by a specific group, such as PRs, is equivalent to the number of households within that group. In the census, each household is assigned a primary household maintainer, whose immigrant status is used to define household immigrant status. Consequently, housing use for a group is defined as the number of owner-occupied and rented dwellings that are primarily maintained by individuals in that group. The housing use rate is calculated as housing units per 1,000 individuals in a population group (Zhang & Hou,
Housing use rates are estimated separately for one-step and two-step PRs by years since admission and tenure (owned or rented) based on the average of estimates from the 2016 and 2021 Census of Population. These rates are also estimated for NPRs by permit type (work, study and asylum
Among one-step and two-step PRs, housing use varies with years since admission, reflecting transitions from rental housing to homeownership and changes in household composition. As the length of residence increases, homeownership rises, while reliance on rental housing declines. Over time, the growing use of owned housing leads to an overall increase in total housing use. For example, among one-step PRs, rental housing use declined from 189 housing units per 1,000 population in the year of admission to 118 units after 20 years (Chart 3). Over the same period, ownership increased from 14 housing units per 1,000 population to 308 units, raising total housing use from 203 units in the year of admission to 426 units after 20 years.
Data table for Chart 3
| Years since admission | One-step permanent residents, owned units | One-step permanent residents, rented units | One-step permanent residents, total units | Two-step permanent residents, owned units | Two-step permanent residents, rented units | Two-step permanent residents, total units |
|---|---|---|---|---|---|---|
| housing units | ||||||
| Source: Statistics Canada, 2016 and 2021 Census of Population. | ||||||
| 0 | 14 | 189 | 203 | 72 | 321 | 393 |
| 1 | 27 | 182 | 209 | 111 | 320 | 431 |
| 2 | 53 | 166 | 219 | 157 | 289 | 447 |
| 3 | 82 | 156 | 238 | 194 | 274 | 468 |
| 4 | 99 | 151 | 250 | 227 | 259 | 486 |
| 5 | 112 | 146 | 258 | 238 | 246 | 484 |
| 6 | 138 | 139 | 277 | 253 | 234 | 487 |
| 7 | 151 | 138 | 289 | 273 | 219 | 492 |
| 8 | 165 | 132 | 297 | 278 | 212 | 490 |
| 9 | 181 | 128 | 309 | 287 | 213 | 499 |
| 10 | 197 | 127 | 324 | 283 | 213 | 496 |
| 11 | 215 | 124 | 338 | 296 | 200 | 497 |
| 12 | 222 | 123 | 345 | 308 | 199 | 507 |
| 13 | 233 | 122 | 356 | 306 | 199 | 505 |
| 14 | 243 | 120 | 362 | 312 | 202 | 514 |
| 15 | 258 | 119 | 377 | 313 | 212 | 525 |
| 16 | 274 | 115 | 388 | 313 | 209 | 522 |
| 17 | 282 | 120 | 402 | 330 | 202 | 532 |
| 18 | 289 | 125 | 414 | 336 | 207 | 543 |
| 19 | 300 | 120 | 419 | 346 | 202 | 548 |
| 20 | 308 | 118 | 426 | 349 | 199 | 548 |
Two-step PRs consistently used more housing units than one-step PRs from the year of admission through at least 20 years after admission. The difference amounted to about 190 housing units per 1,000 population in the year of admission and narrowed to approximately 120 units after 20 years (Chart 3). This gap was driven largely by higher rates of homeownership among two-step PRs, likely reflecting their longer duration of residence in Canada and higher employment income (Hou & Picot, 2024).
Similar to newly arrived one-step PRs, NPRs rely primarily on rental housing (Chart 4). Their per capita housing use also varies by permit type: work permit holders occupied 422 housing units per 1,000 population, compared with 313 units among study permit holders, based on data from the 2021 Census of Population. These differences reflect variations in average household size, which was estimated at 2.4 individuals for households where a work permit holder was the primary household maintainer and 3.4 individuals for households where a study permit holder was the primary household maintainer.
Data table for Chart 4
| Total units | Rented | Owned | |
|---|---|---|---|
| housing units | |||
| Source: Statistics Canada, 2021 Census of Population. | |||
| Asylum claimants | 326 | 301 | 25 |
| Study permit holders | 313 | 280 | 33 |
| Work and study permit holders | 363 | 328 | 35 |
| Work permit holders | 422 | 371 | 51 |
Applying housing use rates to housing use projection
The estimated housing use rates are applied to populations requiring housing to project changes in housing use associated with a hypothetical change of 100,000 in new PR admissions and in the stock of NPRs.
For PRs, the projection involves three phases. In the first phase, the cohort of 100,000 new PR admissions is divided into one-step and two-step PRs. For each group, estimated active presence rates are applied to determine the number of PRs likely to be actively residing in Canada and therefore requiring housing. These population counts are then multiplied by the corresponding per capita housing use rates to estimate expected housing units by tenure and by years since admission.
The second phase estimates the incremental need for housing units by tenure and years since admission. For one-step PRs, housing needs in the year of admission are calculated by applying per capita housing use rates to the number of actively present new admissions. In the first year following admission, the additional housing need is estimated as the difference between projected housing use in that year and projected housing use in the admission year. For subsequent years, the additional housing need is calculated as the year-over-year change in projected housing use.
For two-step PRs, additional housing needs in the year of admission are assumed to be zero, as these individuals are already housed prior to admission as PRs. In the first year following admission, additional housing needs are estimated as the difference between projected housing use in that year and estimated housing use in the admission year. Additional housing needs in subsequent years are calculated in the same manner as for one-step PRs.
The results of the second phase are illustrated in Chart 5. For a cohort of 100,000 new PR admissions, assuming 60% are one-step PRs, the estimated housing need in the year of admission is approximately 10,780 units for one-step PRs and 0 for two-step PRs. In the first three years following admission, the annual additional housing need ranges from about 280 to 1,300 units, depending on the group. After the fourth year, the annual additional housing need becomes smaller and is generally higher among one-step PRs than among two-step PRs. Total additional housing need by years since admission is obtained by summing the contributions of one-step and two-step PRs.
Data table for Chart 5
| Years since admission | One-step permanent residents | Two-step permanent residents | Total additional housing needs |
|---|---|---|---|
| housing units | |||
| Source: Statistics Canada, 2016 and 2021 Census of Population and Longitudinal Immigration Database. | |||
| 0 | 10,780 | 0 | 10,780 |
| 1 | 277 | 1,295 | 1,572 |
| 2 | 505 | 474 | 979 |
| 3 | 1,000 | 642 | 1,642 |
| 4 | 600 | 511 | 1,110 |
| 5 | 56 | -446 | -390 |
| 6 | 813 | -107 | 707 |
| 7 | 403 | -66 | 337 |
| 8 | 178 | -290 | -112 |
| 9 | 387 | 109 | 497 |
| 10 | 458 | -328 | 129 |
| 11 | 597 | -84 | 513 |
| 12 | 212 | 236 | 448 |
| 13 | 395 | -172 | 222 |
| 14 | 216 | 201 | 417 |
| 15 | 556 | 233 | 789 |
| 16 | 423 | -187 | 237 |
| 17 | 500 | 215 | 715 |
| 18 | 440 | 230 | 670 |
| 19 | 108 | 42 | 151 |
| 20 | 187 | -122 | 64 |
The third phase estimates the total projected housing use associated with new PR admissions and PRs admitted in the previous 20 years. Because each admission cohort contributes to housing use in the year of admission and in subsequent years, subject to retention in Canada and evolving housing use patterns, the projected additional housing use in a given year is calculated as the sum of housing needs from new admissions in the admission year and incremental housing needs from earlier PR cohorts. Housing use from earlier cohorts is derived from the number of PR admissions in previous years, estimated active presence rates and housing use rates by years since admission.
Chart 6 illustrates the contributions of new and earlier PR admissions to projected housing unit needs in 2025. The projection assumes 395,000 PR admissions in 2025, of which 60% are one-step immigrants, and assumes that housing use and retention rates remain consistent with those described above. The results indicate that housing use associated with PRs includes an estimated 78,670 owned units, largely reflecting the expanded housing use of PRs admitted in the previous 20 years, and 2,890 rented units, as the strong rental use generated by new PR admissions is largely offset by declining rental housing use among earlier PR cohorts. The total projected use for additional housing units is 81,560, and earlier PR cohorts contribute housing use comparable in magnitude to that of newly admitted PRs.
The estimated total housing use associated with the 2025 PR admissions, even when accounting for housing needs arising from PRs admitted in the previous 20 years, is substantially smaller than estimates derived from dividing total admissions by the average household size in Canada (164,600 units, based on 395,000 admissions divided by the average household size of 2.4 individuals). This latter approach, used by some analysts to approximate housing use associated with immigration levels (e.g., Zimonjic, 2024), does not account for two-step immigration, immigrant-specific housing use rates, non-residence or changes in housing use over time.
Data table for Chart 6
| New permanent residents | Earlier permanent residents | |
|---|---|---|
| housing units | ||
| Sources: Statistics Canada, 2016 and 2021 Census of Population and Longitudinal Immigration Database. | ||
| Owned units | 2,940 | 75,740 |
| Rented units | 39,640 | -36,750 |
| Total units | 42,580 | 38,980 |
Housing use associated with NPRs is modelled using a stock-based approach. Projected annual NPR populations, disaggregated by permit type, provide the starting point. Changes in housing use are estimated based on year-over-year changes in the NPR stock, accounting for reductions resulting from transitions from NPR to PR status.
Per capita housing use rates for NPRs, estimated from census data, are applied to projected NPR population levels to estimate housing use. Because NPR housing use is concentrated in the rental market, the resulting housing use is largely attributed to rental housing. The marginal effect of changes in NPR levels on housing use is calculated as the difference in estimated housing use between consecutive years.
Total housing use associated with immigration in a given year is then calculated as the sum of housing use from PRs—aggregated across admission cohorts—and housing use from NPRs, based on projected changes in the NPR stock, accounting for transitions to PR status.
Overall, the modelling framework allows the effects of changes in PR admissions and NPR populations to be examined separately or jointly. Results can be scaled to alternative immigration scenarios by adjusting the size of PR admission cohorts or NPR population trajectories.
Extensions and limitations
The modelling framework can be extended to examine housing use by dwelling type and community size by applying housing use rates estimated for specific dwelling categories or municipality size groups. Housing use rates are assumed to remain constant over the projection period. The housing use projections for PRs can be further refined by considering differences by immigration class (e.g., economic immigrants, family immigrants and refugees) and life-course stages (i.e., possible changes in the age structure).
The framework does not account for changes in housing supply, prices or behavioural responses to market conditions. Although these factors can significantly influence housing market dynamics, their effects are difficult to forecast because they are highly sensitive to many influences, including interest rate movements and changes in monetary, fiscal, and land use policy. Furthermore, changes in housing supply and prices can also affect the levels and the locational choices of PRs and NPRs.
As a result, the estimates of housing use should be interpreted as projections of housing use associated with recent occupancy patterns of PRs and NPRs under specific immigration policy scenarios, such as immigration levels plans, rather than as forecasts of future housing market outcomes.
Conclusion
This article presents a methodological framework for projecting housing use associated with changes in immigration levels, accounting for differences between PRs and NPRs, two-step immigration pathways, active residence in Canada, and the evolution of housing use over time. By combining observed per capita housing use rates from census data with projected PR admissions and changes in the NPR stock, the framework provides a structured approach to estimating incremental housing use in the rental and ownership markets. The results highlight the importance of considering earlier admission cohorts, in addition to new arrivals, as housing use in a given year reflects the cumulative contribution of immigrants admitted over multiple years rather than admissions in a single year.
The framework supports policy-relevant “what-if” analyses by allowing projections to be scaled to alternative immigration scenarios and assumptions. Compared with simpler approaches used in some studies that divide total admissions by the average household size, this framework incorporates immigrant-specific housing use patterns, two-step immigration, non-residence and changes in housing use with years since admission, leading to more nuanced and carefully specified estimates of housing use. Overall, the framework provides a consistent tool for assessing housing use pressures associated with immigration under recent occupancy patterns. As such, it can inform future analyses of housing needs linked to immigration policy at the national level and across communities.
References
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