Although the federal government recently lowered immigration targets to 395,000 for 2025 (down from their original target of 500,000), Calgary's population growth still seems poised to continue at a strong pace. The city reached 1.49 million in 2024 and is projected to grow to 1.52 million by April 2025, a 2.1% increase from the previous year. This growth is being driven largely by net migration—the movement of people within Canada. While the reduced immigration targets might ease some of the pressure on housing demand in the long run, Calgary continues to be a hotspot for people relocating from other provinces. This means that demand for housing should remain steady, even if immigration drops nationally.
It’s interesting to consider that, despite the lowered federal immigration targets, Calgary still has strong appeal for people relocating within Canada. Whether it’s for job opportunities, lifestyle, or housing affordability, the trend of in-migration to Calgary is expected to continue. I believe we may even see the federal government adjust immigration targets again if the pressure on labor shortages becomes more pronounced—especially since cities like Calgary are such key destinations for interprovincial migrants.
2. Labor Shortages and Housing Supply:
The labor shortage in the construction sector, which has been ongoing since 2024, is likely to continue to tighten the housing supply. It’s already been a challenge for homebuilders to keep up with demand, and we may see this issue persist into 2025. With fewer homes being built, inventory will remain limited, and this could lead to increased competition for available properties. If the labor shortages continue to delay housing development, we could see fewer new homes entering the market, which might fuel more demand for existing homes.
3. Interest Rates and Market Activity:
Interest rates have been a bit of a wild card lately. While there’s been talk of potential rate cuts, we haven’t seen any major movement just yet. If rates do start to drop in 2025, we could see a surge in buyer activity as more people rush to lock in lower rates. This would likely drive up competition for properties, particularly in the lower and mid-price ranges.
4. For Sellers and Buyers:
For sellers, the outlook is favorable as we’re likely to see tighter inventory and continued demand. Sellers could find themselves in a strong position, possibly receiving multiple offers and selling for above asking price. With properties moving quickly, sellers may want to consider listing earlier in the year to take advantage of this momentum.
On the flip side, buyers could face more challenges. With limited inventory, it may take longer to find the right property, and buyers may have to move fast to secure a home—especially if we see a drop in interest rates that fuels more buyer activity. For buyers, pre-approvals will be key, and having financing ready to act quickly will be critical in this fast-paced environment.
5. The Condo Market:
Regarding the condo market in Calgary, while there was a period of overbuilding in the downtown core, particularly in the mid-2010s, the market is now seeing more stabilization. While demand for luxury condos has been softer, more affordable units in key urban areas, such as the Beltline and near transit hubs, continue to show resilience. Calgary's strong population growth is driving steady demand for housing, and labor shortages in construction have been slowing the development of new units. This could potentially tighten condo inventory, especially in sought-after locations. With the foreign buyers ban limiting international speculative investments, this may help balance the market and lead to more opportunities for local buyers.
Looking Ahead:
If these trends hold through February and into the spring, I wouldn’t be surprised to see us head into another seller’s market. It’ll be crucial to stay on top of these developments and be proactive in preparing our buyers and sellers for what’s ahead.
Just thought I’d share these observations as we head into 2025 as we end 2024! I know things may change, but already everyone is asking. I hope this helps.