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Calgary stands out among Canada’s major cities as one of the few where housing affordability is moving in the right direction. According to the Canada Mortgage and Housing Corporation (CMHC), years of record construction have significantly narrowed the city’s housing supply gap, putting Calgary on a realistic path toward restoring pre-pandemic affordability levels by 2036.
Calgary Needs 4,000 to 5,000 New Units Per Year
CMHC’s latest supply gap estimate report shows Calgary must add between 4,000 and 5,000 units annually through 2036 to reach affordability targets. That translates to between 23,000 and 24,000 total new housing starts each year over the next decade. Taylor Pardy, CMHC’s lead economist for the Prairies, said the gap has already shrunk considerably.
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“What we’ve seen is years of record housing starts have resulted in a significant narrowing in that gap as builders have stepped up scaling supply,” Pardy said. “It’s actually been cut in half relative to our previous estimate.”
Currently, Calgary is on pace to build around 19,000 new homes this year. The city recorded 27,000 housing starts in 2024 alone, part of three consecutive years of record construction. Pardy told Global News the market remains strong overall. “We’re on track, essentially, this year to maintain well above the 10-year average starts,” he said. “Overall, the market is still looking fairly robust.”
Construction Slowdown Raises Concerns
However, the pace of new construction is beginning to slow. CMHC reports that total housing starts have fallen more than 20 percent as projects launched over the past three years near completion. The agency points to rising vacancy rates, growing inventories, higher construction costs and broader economic uncertainty as key factors behind the decline.
“As a result, we expect supply growth to moderate once the current development pipeline is delivered,” CMHC stated in its report.
Housing advocates are also raising concerns about a recent policy reversal at city hall. Alex McColl, a board member with More Neighbours Calgary, welcomed the narrowing supply gap but questioned the impact of the city council’s decision to repeal citywide rezoning. That policy, approved by the previous council and effective from August 2024, had changed Calgary’s base residential zoning to allow more housing types — including duplexes, rowhomes and townhouses — on a single property without requiring a public hearing.
The current council voted to repeal the policy earlier this year, with the change also taking effect in August. As a result, 306,774 residential properties across Calgary will revert to their original low-density residential designations.
“So this council is riding the momentum created by the previous housing strategy, which is good,” McColl said. “But repeal without replacement reverses the conditions that increase housing supply.” He added that declining starts today will likely translate into fewer completions in two years. “That worries us that in two years time, we’re going to continue to trend in the wrong direction,” he said.
Mayor Defends Rezoning Repeal
Calgary Mayor Jeromy Farkas defended the council’s decision during a question and answer session with a local Rotary Club chapter. He argued that a blanket approach to rezoning was not appropriate given existing infrastructure limitations.
“I don’t think, with the infrastructure that’s in the ground, that it was adequate to be able to take a one-size-fits-all approach,” Farkas said. “But that said, we have to continue to build and we have to continue to build the housing that Calgarians can afford.”
Meanwhile, a city spokesperson pointed to continued building permit activity in newer communities such as Ricardo Ranch and Alpine Park, as well as in established neighbourhoods like Haysboro and Tuxedo Park. “Altogether, Calgary continues to see strong housing construction which is helping to approach a balance between supply and demand,” the city said in a statement.
Residents and Council Eye the Road Ahead
Not everyone welcomes the pace of development. Lifelong Calgarian Judy Klassen told Global News she finds the scale of construction unsettling. “I don’t like it,” she said. “Look at all the condos they’re putting up. Even in the older areas, they’re building eightplexes on one lot.”
At the same time, Calgary city council is preparing to vote on a revised housing strategy. The updated plan narrows its focus from 98 recommendations down to roughly 10, shifting attention toward non-market housing. The outcome of that vote could shape the city’s approach to affordability for years to come.
