Following years of rapid population growth and a surge in residential construction, the housing market has cooled in Alberta. It’s not a bust but rather a rebalancing of the market as supply catches up to past population growth. Meanwhile, in the resale sector, benchmark home prices have come off their peak and listing inventories have risen, shifting market dynamics away from a firm seller’s market and closer to balanced conditions.

Housing starts pull back from last year’s record

As we expected, Alberta housing starts* have declined this year from last year’s record levels. This reflects a slowdown in population growth and rising inventories of new homes. In July, starts in Alberta stood at 47,409, down 7.2% from the same month last year.

Over the first seven months of 2026, starts averaged 46,800 units, down from last year's historic peak of 54,858 units. Even with the drop, housing starts are on track for their second strongest year (after 2025) since the 2006/07 housing boom.

The 2024-25 boom was driven by a surge in multi-family units, particularly purpose-built rentals, while single-family home construction remained below its earlier peak. So far this year, we’ve seen a gradual decline in both multi-family and single-detached starts.

Though currently running hotter than our annual forecast of 42,100 units from our previous quarterly economic outlook, we still expect activity to slow down over the rest of the year led by a pull back in multi-family units.

Rental market leads declines in Calgary and Edmonton starts

Housing starts have eased from last year’s record highs but some regional variation persists:

• Calgary - Following three consecutive record-setting years beginning in 2022, momentum in Calgary has cooled so far in 2026. Driven by rental unit construction, housing starts are down 23% and responsible for the majority (60%) of the YTD decline experienced so far in Alberta.
• Edmonton - While slower to react initially to rising housing demand, Edmonton achieved record construction numbers in 2024 and 2025. Starts have since moderated from 2025 levels, though recent strength in rental developments has helped offset declines in single-detached homes.
• Other regions - Although regional data remains limited, construction activity outside of Calgary and Edmonton has held steady overall, with Red Deer and Grande Prairie leading gains.

Resale market inching towards more balanced territory

The latest data from the Canadian Real Estate Association on home sales and benchmark prices also point to a rebalancing in Alberta’s housing market.

Alberta’s benchmark home price** hit a record high in January 2025 before declining slightly in step with weaker home sales. Benchmark home prices have declined 2.5% YTD compared to the first seven months of last year. As housing demand continues to moderate with slowing population increases, we expect benchmark prices to stay relatively stable for the rest of the year.

Nationally, the benchmark price peaked in early 2022 and has steadily declined each year since, and is down 4.1% YTD weighed down by Ontario (-5.6%).

Even with the cooldown, inventories remain lower in Alberta. Months of inventory***—a key indicator that measures how long existing listings would take to clear at the current sales rate without additional properties coming onto the market—shows Alberta at 3.5 months supply in July relative to 4.7 months nationally. Additionally, the sales-to-new-listings ratio in Alberta has moved from seller’s to balanced market territory (40-60) with a ratio of 58.5 in July, but remains higher than the national ratio of 51.3 nationally.

Conclusion

While residential construction activity in Alberta is cooling, it's expected to stay above historical norms as the market gradually adapts to normalized population growth and buyers gradually absorb newly added inventory.

At the same time, the resale sector is transitioning toward more balanced market conditions. Most notably, it has managed to avoid extreme price volatility experienced in higher-cost markets such as Vancouver and Toronto.

*Seasonally adjusted annual rate, all centres with 10,000+ population.

**Benchmark prices are generated by the MLS® Home Price Index model. Calgary and Edmonton are the only sub-markets in Alberta for which HPI data are available. The HPI is based on the value home buyers assign to various housing attributes, which tend to evolve gradually over time. It therefore provides an “apples to apples” comparison of home prices across the entire country. Each month, the HPI uses more than 15 years of MLS® System data and sophisticated statistical models to define a “typical” home based on the features of homes that have been bought and sold. These benchmark homes are tracked across Canadian neighbourhoods and different types of houses.

***A seller’s market is typically characterized by having less than four months of inventory; a balanced market four to six months; and a buyer’s market more than six months.

Answer to the previous trivia question: The country that faces the highest overall U.S. tariff burden in 2026 is China.  

Today’s trivia question: In real estate, what does the widely used acronym "MLS" stand for?