Mike Zarowny Real Estate

The potential effects of blanket rezoning on Calgary real estate prices are multi-faceted. These impacts will depend on the scale of rezoning, how it’s implemented, and the broader economic conditions in Calgary.

1. Increased Supply of Housing and Impact on Prices

• Potential to Lower Calgary Real Estate Prices: One of the primary goals of blanket rezoning is to increase the overall supply of housing, which could significantly affect Calgary real estate prices. By allowing for higher-density development (e.g., more multi-family units or higher-rise buildings), it can create a larger supply of homes, which could help ease price pressures.
  When housing supply rises significantly, it generally leads to a decrease in prices, especially in areas that have seen limited development historically. If successful, blanket rezoning could prevent further escalation in the market, making housing more accessible for first-time homebuyers and easing the affordability crisis.
• Price Stabilization: Even if real estate prices don’t immediately drop, increased housing supply could stabilize the market. In high-demand areas where limited housing is available, adding density could prevent prices from soaring. This would be beneficial for potential homeowners, as well as for renters in the city who might otherwise face steep rent hikes due to a lack of housing options.

2. Gentrification Risk and Rising Prices in Some Areas

• Potential for Gentrification and Higher Prices: While blanket rezoning can lower prices in some neighborhoods, it can also contribute to gentrification in certain areas. If zoning changes encourage more upscale developments—such as luxury condos, high-end apartments, and mixed-use commercial spaces—it could drive prices up in those neighborhoods.
  For example, neighborhoods that see an influx of trendy businesses or new high-density residential developments might become more desirable, attracting wealthier buyers or investors. As these areas improve, the overall prices could rise, potentially pushing long-standing residents out of their homes.
• Price Appreciation in High-Demand Areas: High-density development, particularly in well-connected or central areas of Calgary, could drive up the price of land and properties. Developers may target areas near transit hubs, popular districts, or close to the downtown core, where higher-density zoning allows for greater return on investment. This could result in rapid price appreciation in those parts of the city, contributing to an increase in real estate values in some neighborhoods.

3. Changing Demand Dynamics Across Neighborhoods

• Shifting Interest Toward Suburbs or Less-Developed Areas: Blanket rezoning may lead to a shift in where people want to live within Calgary. Areas that were previously underdeveloped or overlooked could see an uptick in demand, as developers begin to target these locations for higher-density residential projects. This may result in rising prices in parts of the city that had previously been more affordable or underdeveloped.
• Impact on Suburban Real Estate: By focusing development within existing urban boundaries, blanket rezoning could reduce the need for suburban sprawl. With fewer people moving outward into the suburbs, prices in suburban areas might stabilize or even decrease, as demand for housing within Calgary’s core increases. This shift could lead to greater pressure on the city center.

4. Impact on Rental Market and Real Estate Investors

• Rental Market Effects: The rental market could see significant changes as well. With more apartment complexes, multi-family homes, and mixed-use buildings being allowed, there could be an increase in the availability of rental units. This increase in supply could help keep rental prices in check, potentially alleviating upward pressure on real estate values.
  However, if blanket rezoning leads to a rush of new luxury rental units, it might push average rents higher, which in turn could elevate property prices by increasing demand for premium properties.
• Opportunities for Investors: For real estate investors, blanket rezoning could create new opportunities. Developers may be drawn to areas with relaxed zoning laws that enable higher-density projects, which could lead to rising demand and higher property prices. Investors might benefit from buying properties in neighborhoods that are poised for redevelopment, especially if rezoning triggers an influx of new businesses and higher-end residential projects.

5. Long-Term Price Effects on Calgary Real Estate

• Sustained Growth in Calgary Real Estate: Over time, the impact on real estate prices will depend on how well the city handles the integration of new developments. If the city can balance new density with strong infrastructure investments, the long-term price effects could be positive for the market.
  On the other hand, if the new developments lead to a mismatch between housing supply and city services (such as schools, transportation, and utilities), real estate prices could become volatile, with some areas experiencing stagnation or declines while others see rapid growth.
• Affordable Housing Measures: If the city incorporates inclusionary zoning or other affordable housing measures as part of the blanket rezoning, this could help ensure that a portion of new developments remains affordable. By mandating that a certain percentage of new housing projects be reserved for low- or moderate-income families, the city could help prevent the rapid escalation of real estate prices while still addressing the housing supply issue.

Conclusion

In Calgary, blanket rezoning could have a mixed impact on real estate prices, depending on how the zoning changes are applied and the broader market dynamics. While it could help lower prices by increasing the supply of new homes and rental units, it also carries the risk of driving up prices in desirable neighborhoods due to gentrification. Suburban areas may see shifts in demand, potentially lowering prices outside the city’s core, while inner-city developments could drive up land values.

If implemented with strategic planning—such as accompanying infrastructure improvements and affordable housing initiatives—blanket rezoning could help Calgary address its housing affordability crisis without excessively inflating real estate prices in the process.

Some information has been gathered, and opinion formed from: https://calgaryherald.com/news/politics/calgary-city-council-rezoning-hearing-seven-days