Key points

• Since early 2024, housing starts in Alberta have jumped. But it looks different from past housing construction booms.  
• Calgary and Edmonton have accounted for the bulk of homes built in the province.
• Rental construction, not owner-occupied housing, has done the heavy lifting—consistent with the national trend.

Yesterday we discussed how Canada’s housing supply gap remains largely unchanged from last year. Calgary was one of the few major cities to narrow its gap, while the report highlighted that Edmonton currently has no measurable gap. Today we’ll unpack what’s actually behind the build-out, and what it means for the mix of homes in Alberta.

Alberta started construction on more than 54,000 homes in 2025—a record. Nearly all of that came from two places: Calgary (~27,700) and Edmonton  (~21,300), together accounting for about 89% of the provincial total. This record pace has cooled over the first eight months of 2026 to an average of 47,700 units (seasonally adjusted annual rate), well above the 10-year average. 

Why did Alberta build so fast?

The key driver is demographics. Alberta’s population growth over 2022-2024 tightened rental markets faster than new supply could respond—rents in both cities climbed, and Calgary’s purpose-built and condominium vacancy rates fell as low as 1.4% and 1%, respectively, in 2023.

Enter purpose-built rentals

Builders responded—a lot. This construction boom wasn't merely a reaction to market demand; it was also driven by key policy shifts and federal incentives designed to spur rental development. The removal of the federal GST on new purpose-built rental construction, combined with more favourable financing and insurance terms through CMHC programs like MLI Select and the Apartment Construction Loan Program (ACLP), spurred developers, making purpose-built—residential buildings designed and constructed to be rented out by a single owner or management company, rather than sold off as individual condo units—rental projects significantly more viable. 

Alberta's most recent construction boom looks different from past cycles. Unlike the province's building surge between 2010 and 2014—which was heavily dominated by homeownership-oriented starts—today's boom is defined by a growing share of rental units in the overall mix. 

Rental starts in Calgary and Edmonton have grown steadily over the past four years to represent nearly half of total starts, with purpose-built rentals now accounting for a significant portion of apartment starts. That new supply brought real relief on the rental side: the purpose-built rental vacancy rate climbed in Edmonton and Calgary to 3.9% and 5%, respectively, in 2025, and some landlords in both cities are reportedly competing on incentives for the first time in years. Asking rents have declined in both cities from their 2024 peaks.  

Alberta isn’t the only province to see a surge in rental supply. Nationally, rental starts hit their second-highest level since 1990 in 2025, and in Toronto, purpose-built rental starts exceeded condo starts for the first time since 1994. Montreal’s rental share of total starts topped 80% in 2025. 

So what about the mix?

This raises a natural question for the future housing mix across Canada, including Alberta. Because new immigrants are more likely to rent when they first arrive, the recent surge in rental construction has played a crucial role in meeting that immediate demand. However, evidence from Statistics Canada shows that immigrants increasingly transition into owner-occupied dwellings over time. As population growth and immigration fall back to more normal levels, will we have the right mix of housing to accommodate this shift?

Earlier this month, CMHC highlighted this as a structural risk, warning that the market could face a critical shortage of ownership options when this current wave of renters is ready to buy. 

Bottom line: Alberta’s recent population growth left a housing gap that needed to be filled, a lot of supply came in the form of rentals—unlike previous home construction booms—a growing share of which were purpose-built rentals. Nationally, the same surge in rentals—specifically purpose-built rentals—has also come alongside a risk of potentially not building enough ownership-oriented housing to support long-term demand.

Answer to the previous trivia question: The Hobbit was published on September 21, 1937.

Today’s trivia question: What, until 2013, restricted buildings in downtown Edmonton from reaching an elevation higher than about 150 metres?