Calgary's rental vacancy rate dropped to 2.7% in 2022 — the lowest since 2014

In 2022, the rental vacancy rate in Calgary dropped to 2.7 per cent — the lowest level the city has seen since 2014, according to a new annual report by the Canada Mortgage and Housing Corporation (CMHC).

At the same time, average rents increased by about six per cent across Calgary, to $1,466 for a two-bedroom unit.

That's compared with 5.1-per-cent vacancy rate, with an average rent of $1,355 for a two-bedroom unit, in 2021.

Calgary's condominium apartment market vacancy also dropped to 1.8 per cent from 4.2 per cent in 2021, and average rents increased by $100, reaching $1,546.

Michael Mak is the senior analyst in economics at CMHC who also authored the Calgary section of the report.

He said rental market supply grew by eight per cent in 2022 — "quite above historical averages" — yet the market is tightening compared to previous years.

The vacancy drop and rent increases are reflective of the province's economy recovering, as well as record levels of in-migration to Alberta, he said.

"With this rate falling to 2.7 per cent, it actually doesn't reflect the total demand that we see coming into Calgary," he said. "Calgary does need more of that supply, especially in the rental market, to help house these new people."

Mak said there's a silver lining: lots of housing construction is underway and developers are more prepared for the growing demand than they were in 2014.

"We're not going to see the constraints we saw in 2014, just from a supply perspective. Developers are much more agile this time around … and they were ahead of the game," he said.

Still, he said he expects continued demand for housing in Calgary as people continue to migrate here.

Immediate solutions needed

Meaghon Reid, executive director of anti-poverty organization Vibrant Communities Calgary, said construction is a good medium to longer-term solution — especially if it's for affordable housing.

However, she said, "construction does not help somebody whose lease ends in three months and they don't have a place to go."

She said she wasn't surprised by the drop in vacancy or increased rents, but she remains concerned, especially for people who are facing precarious housing and may drift into homelessness.

"Because once you're in that space, it's really, really difficult to get you out. So if we can keep people where they're at, keep people housed, give them the appropriate income and supports, then at least we can get through this period of time while those builds start to come online."

The CMHC report shows a widening affordability gap for Calgary's lowest-income households.

According to the report, only about five per cent of rentals are considered affordable for households earning less than $36,000. The majority of those units are studios or one-bedroom units, and are unsuitable for families.

For households making less than $64,000 per year, 76 per cent of rentals are considered affordable — but it also has the lowest vacancy rate, at 1.5 per cent.

"This implies strong demand for affordable units in Calgary, which may lead to decreased difficulty for people who need affordable market housing," said the report.

Reid said Calgarians need a mixture of long-term and immediate solutions, including rent caps, providing income supports and investments in affordable housing.

Pointing to a report conducted by Vibrant Communities Calgary last year, Reid said the province needs to make a $90-million investment immediately to reach its affordable housing goals.

"We really need to put urgency towards this problem and towards a solution that it deserves because families deserve better, and families deserve a home."