Increasing Supply and Demand
Calgary Real Estate and Rental Market Update
September 1, 2024 - Written by Jamie Palmer, President & Broker of Power Properties
The increase in Calgary’s rental rates is starting to show signs of slowing down. This is largely a result of overall affordability, in short people are struggling to pay their bills. A recent survey indicates 32% of Albertans can’t meet their monthly obligations, with another 58% of Albertans within $200 of not being able to do so. As a result, we are seeing an increasing supply of properties over $2500/month.
However, this coincides with increasing demand fueled by inter-provincial immigration. Alberta continues to be the destination of choice for Canadians looking for greener pastures. So which side is winning, the supply or the demand? What we are seeing in many cases is less than half of interested tenants can qualify based on income. So while there is strong demand, the tenants aren’t meeting our stringent screening criteria. As a result, supply is accumulating.
That strong demand is likely to continue as housing starts in Canada are hitting record lows according to Canadian Home Builders. Canada has fewer housing starts in 2024 compared to the same period in 2023. This will further increase pressure on housing both sales and rentals. Ultimately, in the longer term, with continued increasing demand and supply constraints, we are likely to see further increases in rent and sale prices, just not at the same rate we have experienced in the past 12-18 months.