Calgary's record housing starts fall short of restoring pre-pandemic affordability: CMHC

Yahoo

20-06-2025

Calgary is breaking records when it comes to building new homes, but a new report says the city is still a long way from returning to pre-pandemic affordability levels.
To restore affordability to what it was before COVID-19 hit, Calgary needs to build 45 per cent more new homes each year — on top of what's already being built, according to the report by the Canada Mortgage and Housing Corporation (CMHC).
The report looks into housing gaps across the country over the next decade. It estimates that across the country, between 430,000 and 480,000 new units will need to be built annually over the next decade to re-establish affordability last seen in 2019.
"Calgary will need about 9,000 more housing starts a year for the next 10 years to get back to 2019 affordability levels," said Matt Laberge, chief economist with CMHC.
"That won't be possible without changing fundamentally how we build. I'm thinking more [housing], but also, a more trained workforce toward technologies like AI, robotics and automation."
Housing affordability, as defined by CMHC, means that prices should not exceed 30 per cent of a household's gross income.
As CBC Calgary has reported extensively over the years, Calgary's housing crisis emerged after the peak of the pandemic. That's when prices elsewhere in Canada surged and people across the country — and beyond — moved to the city faster than supply could accommodate.
To keep up with the growth, Calgary recorded 24,369 housing starts in 2024 — the third consecutive year of record housing starts, according to CMHC.
Similarly, Edmonton broke its own record with 18,384 housing starts last year. Housing prices in that city are edging up, but it remains one of the more affordable major municipalities in the country.
The report has a much more optimistic outlook for Alberta's capital city. It says Edmonton is building a sufficient amount of housing to maintain affordability over the next 10 years.
The CEO of BILD Alberta said it's too soon to celebrate in either city.
"This report demonstrates that we can't rest on our laurels and say, 'Hey, we set a record last year, everything's good to go," said Scott Fash, whose association represents groups like developers and builders.
"We need to keep pushing and we need to keep improving in order to make sure that we don't end up, five years from now, having a discussion about how we're one of the most unaffordable markets in Canada."
ATB Chief Economist Mark Parsons said he's taking the projections for Edmonton with a grain of salt because it still requires over 16,000 new units to be built each year.
He also noted that Edmonton has become the destination of choice for many young families.
"Perhaps because of the affordability advantage, you could have more people moving to Edmonton than envisioned by CMHC, which would put additional pressure on the housing market."
Parsons said he'll be watching to see how much housing can be built as Alberta faces ongoing labour shortages in the construction sector, an elevated unemployment rate and skills mismatches.
Bill Black, president of the Calgary Construction Association, said it's been "very intense" to keep up with Alberta's demand for infrastructure, whether that's housing or commercial buildings.
He said many workers in the industry feel unappreciated, which is adding to the problem.
"Constantly scorecarding industry without acknowledging its achievements just is not helping," said Black.
"The government has to recognize that we spent the last 40 years allowing construction to become accepted on a societal scale as a second- or third-rate career…. There needs to be a recognition of the error of that societal stigma being allowed to prevail."
Fash at BILD Alberta said meeting these targets will require a full-scale effort from all levels of government.
"Our municipalities need to be providing the land for us to do it and the approvals to do it. Our provincial and federal partners need to be figuring out how we provide the infrastructure to support all of that growth and in a cost effective way."
He also wants Albertans on board.
"We need more housing in every corner of our communities and we need to figure out collectively how to do it. I'm not going to sit here and say that one way is the right way, the other way is not. But we have to do things a little bit differently than maybe we have historically."