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Opinion: It’s not that we have too many people. It’s that we have too few houses
(www.theglobeandmail.com)
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So Canada has 38 million people and 16 million houses, about 2.4 people per house. Average household size in Canada is 2.5, so there is some slack to allow for second homes and vacancy.
Perhaps more houses are needed in the areas where people want to live, but it doesn't seem like that big of a shortage.
You're working under assumption most homes have people.living in them...
That is a 100% indisputably correct assumption. Vacancy taxes worked where they've been implemented to incentivize the occupancy of empty homes and the overwhelming majority of homes have people living in them.