Housing development is increasingly running up against a basic blockage beneath the streets: water and sewer systems that can’t keep up with a city or town’s growth.

As a result, housing projects are delayed, fewer homes reach the market and the cost of new infrastructure construction is increasingly passed onto buyers and renters.

Economists, developers and municipal leaders say water and wastewater systems are increasingly limiting housing construction in parts of Canada as cities and towns struggle with aging infrastructure, rapid population growth and the cost of upgrades.

For example, Killam Apartment REIT, one of the country’s largest residential landlords, said it was pausing new developments in Halifax due in large part to water and wastewater infrastructure bottlenecks. The city is rolling out a multibillion-dollar infrastructure overhaul as it grapples with capacity constraints while working with the province to fast-track development approvals and address pressure on existing infrastructure.

The issue is not solely about zoning approvals or land availability. More than 11 per cent of Canada’s water and wastewater assets are in poor or very poor condition, according to Statistics Canada, with more than an estimated $100 billion in upgrades needed.