Calgary and Edmonton Housing Markets: A Tale of Two Cities

Alberta’s housing landscape is experiencing a fascinating period of transformation. While both Calgary and Edmonton continue to benefit from the province’s exceptional economic strength and population growth, their real estate markets are beginning to tell distinctly different stories. Understanding these diverging trends is crucial for investors, homebuyers, and anyone interested in Alberta’s real estate future.

The Alberta Advantage Continues

Before diving into the differences between these two major metros, it’s important to recognize what they share in common. According to a recent article by Joanna Gerber in Canadian Real Estate Wealth magazine, published on October 15, 2025, both cities are riding the wave of Alberta’s unmatched demographic and economic appeal.

Alberta’s population growth continues to lead the nation by a significant margin, fueled primarily by interprovincial migration. Thousands of Canadians are making the move from more expensive provinces, particularly Ontario and British Columbia, seeking the compelling combination of affordability, robust job opportunities, and an overall superior quality of life. This isn’t just a temporary trend, it reflects fundamental shifts in how Canadians are thinking about where they want to live and build their futures.

The economic fundamentals supporting this migration are impressive. Alberta boasts the lowest corporate tax rate in Canada, maintaining a strong provincial balance sheet that positions it well for continued growth. Perhaps most importantly, the province has cultivated one of the youngest and most educated workforces in the country. This “brain gain” dynamic, the influx of high-value professionals and entrepreneurs, creates a virtuous cycle that supports both labour market strength and sustained housing demand across Calgary and Edmonton.

Affordability: The Critical Differentiator

In today’s Canadian real estate landscape, affordability has become the defining factor for many homebuyers and renters. Compared to markets like Toronto or Vancouver, where homeownership feels increasingly out of reach for average Canadians, both Calgary and Edmonton continue to offer accessible entry points into the housing market.

This affordability advantage hasn’t disappeared even amid higher interest rates that have challenged homebuyers across the country. While borrowing costs have increased substantially from their pandemic-era lows, the absolute price levels in Alberta’s major cities remain manageable for many households, particularly those relocating from more expensive markets. A family selling a modest home in the Greater Toronto Area, for instance, might find themselves able to purchase a significantly larger property in Calgary or Edmonton while still having money left over.

Despite current cyclical challenges, including slowdowns in sales activity and potential near-term supply overhangs, the long-term outlook for both markets remains decidedly bullish, according to the Canadian Real Estate Wealth report. Alberta’s unique combination of affordability, fiscal strength, and population growth positions both metropolitan areas for resilience once current imbalances work themselves out.

Market Balance and Sales Performance: The First Signs of Divergence

While both Calgary and Edmonton experienced softening conditions in August 2025, the nature and scale of these slowdowns reveal important differences between the two markets.

Calgary’s home sales for August were essentially flat on a month-over-month basis, but showed a more pronounced 7.3% decline year-over-year. This indicates that activity has weakened more noticeably in Calgary compared to the previous year. Edmonton, meanwhile, saw sales continuing to trend lower on a monthly basis, though the year-over-year comparisons weren’t explicitly detailed in the same way.

The listing story provides even more insight into how these markets are evolving differently. Calgary experienced a slight decrease in new listings compared to the previous year, while Edmonton saw a substantial 9% increase in new inventory coming to market. At first glance, one might think this would create more downward pressure in Edmonton. However, the real story lies in the accumulation of active listings, which is the total inventory available for purchase at any given time.

Calgary’s active listings surged by an impressive 48% compared to the previous year, while Edmonton’s increase was more moderate at 24%. This larger buildup of unsold inventory in Calgary points to more visible supply accumulation and potential pricing pressure. When homes sit on the market longer and inventory piles up, sellers often become more motivated to adjust their expectations, creating downward momentum in prices.

Understanding Sales-to-New Listings Ratios

Real estate professionals often use the sales-to-new listings ratio as a key indicator of market balance. This metric compares how many homes are selling relative to how many are coming onto the market. Generally speaking, a ratio above 60% indicates a seller’s market, while readings below 40% suggest a buyer’s market. The range between 40% and 60% is considered balanced.

Calgary’s ratio currently sits in the high 50s, while Edmonton’s remains in the mid-60s. Both readings indicate a shift toward more balanced conditions compared to the tight markets of the previous couple of years. However, Edmonton’s tighter ratio signals comparatively stronger absorption, meaning homes are selling at a faster pace relative to new supply, and therefore less immediate downward price pressure.

This difference in market dynamics, while perhaps subtle on the surface, has significant implications for price trends, which is where Calgary and Edmonton’s paths truly diverge.

The Price Divergence: Calgary Under Pressure, Edmonton Holding Steady

Price trends represent the most striking difference between Calgary and Edmonton’s housing markets right now, and these differences matter enormously for both buyers and sellers.

Calgary is experiencing accelerating price declines. Overall benchmark prices have fallen 4% year-over-year, with condominium prices showing an even steeper 6% decline. Importantly, the pace of these declines has picked up in recent months, reflecting the combined impact of rising active listings and softening sales momentum. When inventory builds and buyers have more choices, they naturally become more selective and price-conscious, forcing sellers to be more competitive with their pricing.

For buyers in Calgary, this represents an opportunity. After years of rapid price appreciation, the market is offering better value and more negotiating power. Multiple-offer situations have become less common, and buyers can take their time to find the right property without feeling rushed into decisions.

Edmonton presents a different picture entirely. Prices remain higher than they were a year ago, although they have slipped for five consecutive months according to the MLS Home Price Index referenced in the Canadian Real Estate Wealth article. The direction is certainly negative, but the magnitude of Edmonton’s price adjustments has been far less severe than what Calgary is experiencing.

This divergence is particularly interesting given that both markets appear similarly “balanced” by other metrics. The key difference lies in momentum and sentiment. Calgary’s price corrections have accelerated as inventory pressure mounts, while Edmonton’s slower listing growth and tighter market balance have delayed comparable declines. Market psychology plays a role here too—once prices begin falling in one market, it can create self-reinforcing expectations that further dampen buyer urgency.

The Construction Boom: Building for the Future

Both Calgary and Edmonton are experiencing significant construction activity, particularly in purpose-built rental developments. However, the underlying dynamics differ in ways that could have major implications for future market balance.

Total dwellings under construction rose 11.6% year-over-year in Calgary, compared with a much more robust 28.9% increase in Edmonton. Both cities saw nearly identical 41% surges in purpose-built rentals under construction, reflecting a national shift toward rental development amid high borrowing costs that have made homeownership more challenging for many Canadians.

The interesting divergence appears in the ownership market. Edmonton reported a 14.7% increase in single-family construction, significantly outpacing Calgary’s modest 0.9% rise. This indicates more robust new-home activity targeted at owner-occupiers in Edmonton, suggesting developers and builders have greater confidence in that market’s ability to absorb new ownership supply.

The Rental Supply Question: Calgary’s Looming Challenge

When rental units are isolated from the broader construction picture, Calgary’s situation appears more precarious. The Canadian Real Estate Wealth report identifies Calgary as being in a “danger zone” for potential oversupply once current projects reach completion, given the scale of rental development relative to expected population gains.

The numbers are striking: over the next two years, Calgary’s total rental stock could expand by approximately 17%, compared to about 9% in Edmonton. With population growth projected at no more than 4% over the same period, Calgary could face a temporary but significant imbalance.

This potential oversupply situation could push vacancy rates across the province back toward levels not seen since the early 1990s, when Alberta’s economy was struggling through a prolonged downturn. For current rental property investors in Calgary, this represents a serious consideration. Higher vacancy rates translate to increased competition for tenants, potential rent concessions, and possibly negative cash flow for properties that are highly leveraged.

However, it’s important to maintain perspective. Unlike the 1990s, today’s Alberta economy is fundamentally strong, supported by diversification efforts and a young, educated workforce. Any rental market softness would likely be temporary, lasting only as long as it takes for population growth to catch up with the new supply. For investors with longer time horizons and adequate reserves, this period could even present opportunities to acquire properties at more favorable valuations.

Edmonton, while also expanding its rental base considerably, appears better positioned to absorb new supply due to a more moderate pipeline and less rapid inventory buildup. The 9% rental stock expansion projected over two years is much more closely aligned with expected population growth, reducing the risk of extended vacancy periods.

What This Means for Different Market Participants

For Homebuyers in Calgary: The current market presents opportunities that haven’t existed in years. With prices declining and inventory elevated, buyers have negotiating power and time to make thoughtful decisions. However, those planning to purchase should be prepared for the possibility of further near-term price softness before the market finds its floor.

For Homebuyers in Edmonton: While the market has cooled from its peak, conditions remain more balanced with less dramatic price declines. Buyers have more options than they did during the intense seller’s market of recent years, but competition for well-priced properties remains healthy.

For Sellers in Both Markets: Pricing strategy is crucial. Overpricing in the current environment will likely result in extended days on market and eventual price reductions. Working with experienced real estate professionals who understand current market dynamics and can position properties competitively is more important than ever.

For Rental Property Investors: Calgary investors need to carefully assess the upcoming supply wave and ensure their properties are well-positioned to compete for tenants. This might mean investing in upgrades, offering competitive amenities, or accepting that yields may compress temporarily. Edmonton investors face a more moderate supply challenge but should still prepare for increased competition.

For Long-Term Investors: Despite near-term challenges, Alberta’s fundamental strengths remain intact. The province’s economic diversification, fiscal position, demographic trends, and affordability advantages position both Calgary and Edmonton for long-term growth. Patient investors who can weather short-term volatility may find this period creates attractive entry points.

Looking Ahead: Resilience Through Transition

Real estate markets move in cycles, and what we’re witnessing in Calgary and Edmonton represents a natural adjustment after a period of rapid growth. Both cities experienced significant price appreciation and tight market conditions in recent years as migration accelerated and inventory struggled to keep pace with demand.

The current divergence between these two markets reminds us that real estate is inherently local. Even cities within the same province, sharing similar economic fundamentals and demographic trends, can experience meaningfully different market conditions based on supply dynamics, construction activity, and market sentiment.

Calgary’s more pronounced challenges, accelerating price declines and looming rental supply concerns, should resolve as the market works through current inventory and population growth continues. The city’s strong economic base, corporate headquarters, and quality of life advantages ensure ongoing appeal to migrants and businesses alike.

Edmonton’s more moderate adjustment reflects a market that has maintained better balance between supply and demand. Its construction activity, while robust, appears more calibrated to expected absorption capacity. This doesn’t mean Edmonton is immune to further softening, but the adjustment process may prove less volatile.

Conclusion

As Joanna Gerber’s analysis in Canadian Real Estate Wealth makes clear, Calgary and Edmonton are at different points in their market cycles despite sharing many of the same economic and demographic tailwinds. Understanding these differences is essential for anyone involved in Alberta real estate—whether you’re buying your first home, selling a property, investing in rentals, or simply trying to understand where these dynamic markets are headed.

Both cities benefit from Alberta’s exceptional position as Canada’s economic and demographic growth leader. The province’s low taxes, strong balance sheet, young workforce, and affordability advantages create a foundation for long-term real estate success. The current period of adjustment, while challenging for some market participants, represents a healthy rebalancing after years of rapid growth.

As always in real estate, timing, location, and individual circumstances matter enormously. Working with knowledgeable local professionals who understand these nuanced market dynamics can make the difference between success and disappointment. Whether you’re focused on Calgary, Edmonton, or comparing both markets for investment purposes, staying informed about these evolving trends will help you make better decisions.

The story of Alberta’s two largest housing markets continues to unfold, and while their paths may diverge in the short term, both remain compelling destinations in Canada’s real estate landscape.

Source: “Calgary and Edmonton Housing Markets Are Both Growing, but Diverging in Price and Supply” by Joanna Gerber, Canadian Real Estate Wealth, October 15, 2025