Gap to restore pre-pandemic housing affordability by 2036 in Calgary narrowing: CMHC

Calgary is one of the few major Canadian cities where the gap to restore pre-pandemic housing affordability has narrowed, according to the Canada Mortgage and Housing Corporation (CMHC). The agency estimates that Calgary will need between 4,000 and 5,000 additional housing units annually by 2036 to achieve this goal, with the gap having narrowed significantly due to years of record construction.

CMHC's lead economist for the Prairies, Taylor Pardy, attributes this narrowing to builders stepping up and scaling up supply. Currently, Calgary is on track to build around 19,000 new homes this year, nearly double the 10-year average. However, housing advocates are concerned that the city won't be able to keep pace with the construction required.

Recent trends show a decline in total housing starts by over 20%, as projects from the last three years reach completion. This slowdown is attributed to rising vacancy rates, growing inventories, higher construction costs, and broader economic uncertainty. CMHC expects supply growth to moderate once the current development pipeline is completed.

The recent repeal of citywide rezoning, which took effect in August 2024, has also raised concerns among housing advocates. This policy change will see 306,774 residential properties across Calgary redesignated back to their original low-density residential districts. Calgary Mayor Jeromy Farkas defended the move, stating that the city's infrastructure is adequate to handle the current level of housing construction.

However, housing advocates worry that this policy reversal could reverse the conditions that increased housing supply.