Calgary's Paradox: Booming Consumption Amid Affordability Concerns

Calgary is navigating a curious economic contradiction: bustling shopping centres thriving even as the city grapples with a deepening affordability crisis. Major retail destinations like CrossIron Mills continue to see high consumer activity, even during weekdays, despite widespread concerns over rising costs. The city's retail property market demonstrated consistent sales and leasing from July 2023 to July 2024, with enclosed malls showing particular strength.

This sustained consumer activity unfolds while Calgary faces its worst affordability measures in over a decade. The median residential sale price climbed 13% in 2024, and average rents increased nearly 10% year-over-year. At least one in five Calgary households struggle with housing costs, a situation Mayor Jyoti Gondek has described as a "housing crisis.". While consumer price inflation is projected to remain elevated in Calgary, above the national rate, anticipated easing interest rates are expected to further boost consumer spending.

Recent discussions among local economic analysts often highlight a 'two-speed economy' within Calgary. This dynamic sees a segment of the rapidly growing population, which added nearly 220,000 residents between 2020 and 2024, continuing to drive demand and consumer spending. This strong population growth, coupled with robust commodity prices, has positioned Calgary's economy to grow faster than the national average. This raises critical questions about how Calgarians are balancing discretionary spending with increasing financial pressures. The paradox underscores a complex economic landscape that will be crucial for the city's future growth and sustainable development.