Canada has moved to slow immigration in 2024 and 2025 to ease a national housing shortage, lowering Permanent Resident targets and capping temporary residents in what officials call the largest reset in over a decade. As of August 26, 2025, the federal plan aims to cool demand for homes while protecting the labour force, with priority for skilled workers already in the country.
The budget watchdog has backed the shift, saying the immigration curbs should reduce near‑term pressure on rents and home prices. But the same analysts warn the policy will not fix supply gaps on its own. Ottawa’s message is clear: fewer newcomers from abroad, more transitions for people already here, and a stronger tilt to economic streams tied to health care and the skilled trades.
Key changes in admissions and targets
Under the 2025–2027 Immigration Levels Plan announced in October 2024, the government cut 2025 admissions by 105,000 from earlier plans. The new target is 395,000 permanent residents in 2025, down from earlier goals that had pointed to 500,000 a year. Further decreases are forecast for 2026 and 2027.
According to analysis by VisaVerge.com, these numbers mark a sharp reversal from the post‑pandemic surge that peaked at 437,000 in 2022.
Temporary resident caps and in‑country priority
Alongside lower Permanent Resident targets, Ottawa has:
- Capped study permits and tightened temporary work routes.
- Narrowed entry for international students and some temporary workers—groups previously not fully built into housing estimates.
- Reserved over 40% of 2025 permanent resident spots for applicants already living in Canada (many on study or work permits) to support the workforce without adding as much strain on housing and social services.
By 2027, the plan dedicates 62% of admissions to the economic class, focusing on:
- Nurses
- Personal support workers
- Carpenters
- Electricians
- Other trades vital to building homes and delivering care
Family reunification remains a pillar at 24% of 2025 admissions, and Canada continues its refugee commitments and support for Francophone communities outside Quebec.
Important: Over 40% of 2025 permanent resident spots are reserved for applicants already in Canada — a clear pivot toward retaining existing temporary residents.
Population and housing impact
Officials expect a 0.2% dip in population growth in both 2025 and 2026, giving provinces and cities time to catch up on housing, transit, and clinics. The hope is that slower demand, paired with more construction workers, can give builders room to expand.
The housing shortfall is significant:
- CMHC says Canada needs 430,000 to 480,000 new homes each year until 2035 to restore affordability—nearly double today’s pace.
- Without major changes, CMHC projects a shortfall of 3.5 million homes by 2030.
- Construction vacancies are at record highs, raising costs and slowing builds.
In response, the federal department has created targeted entry streams to fast‑track applicants with proven trades experience.
Political leadership and messaging
Prime Minister Mark Carney, elected in April 2025, has championed “stabilization” across immigration and public services. He argues the reset will ease pressure on housing, emergency rooms, and classrooms while keeping doors open for workers who can help Canada build faster.
Immigration Minister Marc Miller stresses that the housing crisis “cannot be solved without the aid of new immigrants,” especially tradespeople, even as he defends tighter controls to match inflows with what communities can absorb.
Public opinion and polling
Public attitudes have shifted. Polling in late 2024 found nearly 60% of Canadians believed the country was taking in too many newcomers—a marked change from earlier years when rising targets drew broad support.
- Many still view immigration as a net positive for the economy and Canada’s social fabric.
- The housing shortage has become the lens through which most people judge immigration policy.
Policy changes and timelines
- 2024–2025: Federal immigration curbs lower Permanent Resident targets and add caps on temporary residents, especially study permits.
- 2025: 395,000 permanent residents planned; >40% slots for applicants already in Canada as temporary residents.
- 2026–2027: Further decreases forecast; by 2027, 62% of admissions shift to the economic class. Family reunification at 24% in 2025; refugee and Francophone priorities continue.
For official rules, program details, and updates, see Immigration, Refugees and Citizenship Canada’s website and policy pages: IRCC.
Impact on students, workers, and employers
For newcomers abroad:
- Fewer openings over the next two years.
- Stricter screening for study and work permits.
For people already in Canada:
- The door to permanent status is wider, especially for nurses and trades workers.
- Students face tighter intake limits; colleges and cities anticipate smaller cohorts and some program cuts.
For employers, especially in construction and health care:
- Government message: look to in‑Canada talent first.
- Permanent spots are steered toward workers already on the ground to retain skills without adding as much housing demand.
Industry leaders welcome the focus on trades but warn job sites still lack enough people to meet CMHC’s ambitious build targets (pour foundations, frame homes, wire buildings).
Economic risks and required complements
Economists caution that tighter intake may:
- Trim economic growth.
- Deepen labour shortages in some sectors.
Analysts and the budget watchdog emphasize the reset is a start, not a solution. They recommend pairing intake changes with:
- Zoning reform
- Faster permits
- Infrastructure investment
- Local measures to speed approvals and allow greater housing density
- Addressing taxes and fees that raise construction costs (e.g., goods and services tax rules on rentals)
Social and humanitarian commitments
- Family sponsorships (spousal and child) remain protected within the 24% share.
- Refugee programs continue to focus on vulnerable groups.
- Humanitarian organizations have urged Ottawa to maintain these commitments even as overall numbers fall.
Final takeaways
- The policy shift aims to temporarily cool housing demand while prioritizing economic retention of people already in Canada.
- It reserves more permanent spots for in‑country applicants and focuses admissions on health care and trades.
- Experts stress that supply-side fixes—faster builds, zoning reform, and infrastructure—are essential to meaningfully restore affordability.
This Article in a Nutshell
Canada cut 2025 Permanent Resident targets to 395,000 and capped temporary residents to cool housing demand, reserving over 40% of PR spots for in‑country applicants and shifting admissions toward economic streams like health care and trades; experts say supply‑side reforms are still required to fix affordability.
