Canada's residential construction activity has slowed in recent months due to a tight labor market and higher borrowing costs, a factor that could thwart government plans to reduce a housing shortfall and add to the recovery in home prices. That would be bad news for the Bank of Canada as it seeks to lower inflation but also a problem for Prime Minister Justin Trudeau who has vowed to improve housing affordability. While a federal election is not due until 2025, housing affordability is among the top concerns for Canadians who have grappled with supply shortages.