Calgary is bucking the national trend. While most major Canadian cities sink deeper into housing crises, Calgary's supply gap is finally narrowing.
According to fresh data from the Canada Mortgage and Housing Corporation (CMHC), years of record home construction have cut Calgary's pre-pandemic housing affordability gap in half. That sounds like a massive win for anyone tired of skyrocketing rents and bidding wars. But before you pop the champagne, look closer at the pipeline. Starts are dropping, policy changes are throwing wrenches into the machinery, and the path to 2036 remains bumpy. If you enjoyed this post, you should read: this related article.
The Numbers Behind the Shift
Let's look at what the CMHC report actually says. Calgary needs between 4,000 and 5,000 additional units annually by 2036 to fully restore pre-pandemic affordability levels. That translates to roughly 23,000 to 24,000 total new housing starts every year over the next decade.
It sounds like a tall order, but builders have shown they can do it. Last year alone, the city recorded 27,000 housing starts. That capped off three straight years of record-breaking construction. Taylor Pardy, CMHC's lead economist for the Prairies, points out that the market is still performing way above the ten-year average. For another look on this development, see the latest coverage from NBC News.
Even with a projected total of around 19,000 new homes this year, Calgary is maintaining momentum that other housing markets can only dream of.
Why New Construction Is Slowing Down
You can't build at record speeds forever without hitting a wall. Total housing starts have dropped by more than 20 percent as projects launched during the building boom finally reach completion.
Why the sudden brake-checking?
- Rising vacancy rates
- Growing housing inventories
- Persistent inflation in construction costs
- Broader economic uncertainty
Developers aren't charity workers. If margins shrink and units sit empty on the market, they stop pouring concrete. CMHC expects supply growth to moderate significantly once current pipelines clear out.
The Zoning Policy Debate
Construction numbers only tell half the story. Policy decisions happening right now at City Hall could make or break future inventory.
The previous city council approved a sweeping citywide rezoning policy that took effect in August 2024. It flipped base residential zoning to allow duplexes, rowhomes, and townhouses on single-family lots without requiring agonizing public hearings. It unleashed a wave of missing middle housing.
Now? The current city council voted to repeal it. More than 300,000 residential properties are heading back to low-density zoning.
Alex McColl, a board member with More Neighbours Calgary, points out the obvious flaw in this approach. Good starts from two years ago mean good completions today, but falling starts right now mean trouble down the road. Repealing density rules without a functional replacement reverses the exact conditions that allowed supply to scale up in the first place.
Mayor Jeromy Farkas defends the reversal, arguing that existing infrastructure couldn't handle a one-size-fits-all approach. Yet, the city's own permit activity shows strong growth in both new master-planned communities like Ricardo Ranch and established neighborhoods like Haysboro.
What This Means for Buyers and Renters
If you're hunting for a home in Calgary, don't expect instant miracles. While the narrowing supply gap proves that building homes actually works to stabilize prices, policy flip-flops threaten to choke off future relief.
City council is currently refining its housing strategy down from nearly a hundred recommendations to a tight focus on non-market housing. Meanwhile, traditional neighborhoods are pushing back against density, worried about changing streetscapes and eightplexes popping up on single lots.
Calgary proved it can scale supply when developers and policy align. Keeping that momentum alive through 2036 will require more than wishful thinking and political reversals. It takes sustained building, sensible zoning, and keeping the pipeline open.
Watch the housing starts data over the next four quarters. That is your true indicator of whether Calgary fixes its affordability puzzle or falls back into the Canadian norm.
