August 24, 2021
How affordable is living in Calgary?
Calgary has dodged the housing-cost escalation of major cities in Ontario and British Columbia, but affordability is creeping up as a political flashpoint in both the municipal and federal elections.
After years of depressed conditions due to the oil and gas industry downturn, Calgary’s real estate prices are rising while supply is tightening. According to the Calgary Real Estate Board, 2,319 homes were sold in July, up 26.4 per cent from the same period last year, making it the busiest July on record. Benchmark prices reached $460,100, 10 per cent higher than in the same period a year ago. Price growth has been the highest in the detached-home sector. The price of a typical home was $539,900 in July, up 11 per cent from a year ago. As for supply, there were 6,678 units on the market, about the same as during the same period last year.
To be sure, the cost of buying a home in Calgary is still a bargain compared to Toronto and Vancouver, where the cost of a home is more than $1 million, according to data compiled by WOWA. Indeed, Calgary’s lower housing prices have played in its favour so far by attracting people from higher-cost places.
But that competitive advantage will erode if housing costs continues to rise. The price of real estate is just a part of housing affordability. Governments at all levels are contributing to higher housing costs. Property taxes, carbon taxes, utility costs, mortgage rates, inflation are all moving up. Meanwhile, growing red tape is making it harder and more time consuming to increase housing supply.
Housing affordability is a big issue across Canada, particularly for Millennials, according to pollster Nik Nanos. He said 15 per cent of Canadians recently surveyed are worried about whether they will be able to pay for their housing in the next 30 days, and 78 per cent would “look kindly on any party that had a concrete action plan” to deal with affordable housing and homelessness. In the Calgary election, candidates for mayor and city council are making housing a major part of their platforms, proposing initiatives like capping property taxes or making affordable housing a city hall priority.
How do you feel about affordable housing?