Key Takeaways
- Small-scale infill projects represented 6.45% of Toronto's total housing starts in 2025, compared to 0.62% in 2023.
- Residential conversions delivered over four times as many units as new single- and semi-detached construction during the first half of 2025.
- Multiplex permissions now extend to up to four units citywide and five or six units in nine wards following May 2023 reforms.
- Toronto's infill share trails Vancouver's 18.07% and Edmonton's 23.28%, reflecting slower uptake in Ontario.
- Conversion projects are spreading across established neighbourhoods, unlike high-rise construction concentrated downtown.
Toronto's housing supply landscape shifted measurably between 2023 and 2025, with small-scale infill projects climbing from a negligible share to a meaningful portion of new construction. The growth reflects zoning changes approved in May 2023 and a wave of residential conversions that have become the dominant form of missing middle development in the city.
What the 2025 figures show
Small-scale infill — defined by CMHC as accessory dwelling units and buildings containing two to eight units — accounted for 6.45% of Toronto's total housing starts in 2025. That figure marks a tenfold increase from the 0.62% recorded in 2023.
The expansion occurred even as overall housing starts slowed, indicating that smaller projects gained ground while larger developments faced headwinds. CMHC analysis combined housing starts data with historical satellite imagery to identify which projects occupied previously developed land rather than greenfield sites.
During the first half of 2025, residential conversions initiated over four times as many units as the combined total of new single-detached and semi-detached starts built on fresh foundations. Conversions have emerged as the leading pathway for adding missing middle housing in Toronto, a pattern that distinguishes the city from other Canadian markets where new construction on infill lots plays a larger role.
Zoning reforms and where they apply
Toronto City Council approved as-of-right permissions for multiplexes containing up to four units in May 2023. The reforms removed discretionary approval processes that previously applied to these projects, allowing property owners to proceed without rezoning applications.
As-of-right allowances for five-unit and six-unit buildings have been extended to nine out of 25 wards. The geographic spread of conversion activity differs from high-rise construction, which remains concentrated in the downtown core. Small-scale infill projects are appearing across established neighbourhoods where limited undeveloped land makes gentle density a practical necessity.
The city recently waived development charges for projects containing up to six units, improving the financial feasibility of smaller developments. Combined with the Bank of Canada policy rate at 2.25%, financing conditions have become more supportive for investors evaluating conversion opportunities.
How Toronto compares to other cities
| City | Small-Scale Infill Share 2023 | Small-Scale Infill Share 2025 |
|---|---|---|
| Toronto | 0.62% | 6.45% |
| Vancouver | 13.22% | 18.07% |
| Edmonton | 9.95% | 23.28% |
Toronto's 2025 share lags both Vancouver and Edmonton despite similar zoning reforms. Edmonton's 23.28% reflects stronger uptake of small-scale projects in a market with more abundant land and lower construction costs. Vancouver's 18.07% demonstrates sustained momentum in a city that implemented multiplex permissions earlier.
Uptake in Ontario has been slower overall, partly reflecting weaker housing starts in recent years. The New Housing Price Index for Toronto and Oshawa stood at 120.4 in August 2026, down 2.0% year-over-year, signalling softer conditions for new construction generally.
Nationally, small-scale infill represented 10% of Canada's housing starts in 2025. The share of all housing starts on previously developed land reached 60.17% in 2025, up from 54.5% in 2016. Larger infill developments containing nine units or more accounted for 63% of national housing starts in 2025, compared to 42% in 2016, indicating that infill construction has grown across all scales.
What it means for buyers
The rise in small-scale infill expands the range of ground-oriented options in established neighbourhoods. Buyers priced out of single-detached homes now find more townhouse and low-rise units in areas that previously offered limited choice. Conversions deliver housing in mature neighbourhoods with existing transit, schools and amenities, avoiding the trade-offs associated with greenfield subdivisions on the urban fringe.
Properties in wards with expanded multiplex permissions may see increased competition from both end-users and developers. Buyers evaluating older single-family homes should consider whether zoning allows conversion, as that potential can influence resale value and the pool of future buyers.
What it means for sellers
Single-family property owners in areas with as-of-right multiplex permissions may attract interest from developers seeking conversion opportunities. The waiver of development charges for projects up to six units improves project economics, potentially increasing the price a developer can pay for an acquisition.
Sellers should verify the zoning status of their property and understand whether it falls within one of the nine wards permitting five or six units. Properties with larger lots, older structures or layouts conducive to conversion may command a premium from buyers evaluating infill potential.
The shift toward conversions rather than new construction reflects Toronto's limited land supply and the regulatory environment. Sellers in established neighbourhoods benefit from the growing recognition that missing middle housing represents a practical path to densification.
What it means for investors
Residential conversions have become the dominant form of missing middle development in Toronto, creating opportunities for investors who can navigate the approval process and manage construction. The city's development charge waiver reduces upfront costs, while the Bank of Canada rate at 2.25% supports borrowing conditions.
Investors should focus on properties in wards with expanded permissions and assess whether existing structures can be economically converted. The fact that conversions delivered over four times as many units as new single- and semi-detached starts in the first half of 2025 indicates where market activity is concentrated.
Toronto's slower uptake compared to Western cities suggests room for growth as the regulatory environment matures and more property owners recognize the potential. Limited land availability makes infill development a necessity rather than a choice, supporting long-term demand for conversion projects.
Frequently asked questions
What counts as small-scale infill?
CMHC defines small-scale infill as accessory dwelling units and buildings containing two to eight units. The category includes laneway houses, duplexes, triplexes and small walk-up apartments built on previously developed land.
Why are conversions more common than new construction?
Conversions avoid the cost and time associated with demolition and new foundations. Existing structures can often be adapted more quickly and at lower cost than building from scratch, particularly in neighbourhoods where lot sizes and setbacks constrain new construction.
Which wards allow five or six units as-of-right?
Nine out of 25 wards have extended as-of-right permissions to five and six units. Property owners should verify zoning status with the city or consult a real estate professional familiar with local regulations.
How does the development charge waiver work?
Toronto waived development charges for projects containing up to six units to improve financial feasibility. The waiver reduces upfront costs for developers and property owners undertaking conversion or infill projects.
Outlook
Toronto's small-scale infill share is likely to continue growing as property owners and developers respond to zoning reforms and the city's limited land supply. The tenfold increase between 2023 and 2025 demonstrates that regulatory changes can shift construction patterns, even during a broader slowdown in housing starts.
Whether Toronto's share converges with Vancouver or Edmonton levels depends on factors including construction costs, land availability, and the pace at which the market adapts to new permissions. The dominance of conversions over new construction suggests that Toronto's infill growth will follow a distinct path shaped by the city's built form and regulatory environment.
For buyers, sellers and investors, the expansion of small-scale infill represents a structural shift in how Toronto adds housing. Understanding where permissions apply and how conversion economics work will become increasingly important as missing middle projects spread across established neighbourhoods.
If you're evaluating a property in Toronto or the GTA and want to understand how zoning changes affect value and potential, request a free home evaluation or explore current Toronto and GTA listings.
Sources & References
- Canada Mortgage and Housing Corporation — Small-scale infill, big impact: How it adds to housing supply in Canada: cmhc-schl.gc.ca
- Statistics Canada — New housing price index, monthly: statcan.gc.ca
- Bank of Canada — Target for the overnight rate: bankofcanada.ca
- Storeys — Small-Scale Infill Is (Finally) Showing Up In Toronto's Housing Data: storeys.com
Data last checked: 2026-09-24
