For Calgary homeowners, builders and contractors, the cost of construction has become a moving target.
The sharp material increases and supply-chain disruptions that defined the pandemic years have eased, but prices have not returned to where they were before COVID-19. Labour remains tight, transportation and financing costs have risen, tariffs have introduced new uncertainty and, depending on the project, permitting, servicing, levies and building-code requirements are adding to the bill.
For Shane Wenzel, president and CEO of Shane Homes, the biggest change is where the pressure is coming from.
“Fifteen years ago, most people in our industry would agree that it was the cost of material or labour,” he says. “Those have become the smallest part of increases to the cost of new homes.”
Wenzel says changes to the 2025 building code can add $40,000 to the cost of a new Alberta home before a foundation is poured. Add land, off-site levies and municipal charges, he says, and the cost equation looks very different than it once did.
Materials have hardly become inexpensive. Pandemic-era spikes have settled into what Wenzel calls a “new normal” well above previous levels, while skilled labour remains scarce. But he says approval timelines, levies and additional code requirements are now among the pressures he watches most closely.
For Sean Corrigan, project manager with Abris Construction Calgary, which focuses exclusively on multi-residential restoration, labour and materials remain the dominant concerns.
“The truth is that it is really all of the above, but the biggest factors are certainly labour and materials,” Corrigan says.
He points to steady year-over-year material increases, sometimes more than once a year, along with rising wages as companies compete for skilled workers. Health and safety obligations, tariffs and supply chain challenges involving products such as lumber, steel and liquid waterproofing materials are also affecting pricing and lead times.
The labour issue is more complicated than simply finding someone with a construction background.
“There are niches within the industry, such as new-build residential, new-build commercial, retrofit construction, residential restoration and multi-residential restoration,” Corrigan says. “Often, simply having experience in a particular trade isn’t enough – the experience needs to run deeper into the specific type of construction to be truly effective.”
Seasonality adds another challenge, making it difficult for contractors to maintain crews throughout the year.
Oliver Brown, owner/sales at Rusch Design Build, sees similar pressures in Calgary’s residential renovation market. Labour and materials rose significantly during the pandemic and, although some supply-chain issues have improved, costs have not returned to earlier levels.
Fuel and transportation are now feeding into supplier pricing, while trade disputes with the U.S. are affecting products including appliances and carpet.
“With renovations involving products and materials from all over North America and overseas, changes in tariffs, transportation and trade can work their way into the cost of a project fairly quickly,” Brown says.
For homeowners, that can create a disconnect between the renovation they imagine and what it costs to deliver.
Brown finds well-researched clients often arrive with a reasonable understanding of current Calgary pricing. Others may be working from renovation television shows or online information from markets that bear little resemblance to Calgary.
Scope is another source of sticker shock. What begins as a kitchen renovation may extend to flooring across the main floor, lighting, painting, electrical and plumbing work, cabinetry and adjoining spaces.
When a budget and wish list do not align, Brown says the answer is not necessarily to make every component cheaper.
“We would rather help a homeowner prioritize the things that are most important to them than simply try to make everything cheaper,” he says.
That could mean containing the renovation to fewer areas, keeping an existing layout, selecting a less expensive finish in one area to preserve a higher-priority feature in another, or postponing part of the work.
Customers are making similar calculations in the new home market.
Wenzel has seen buyers become more patient after the urgency of 2021 through 2024, taking more time to compare products and scrutinize value. He is seeing a shift toward smaller single-family homes, townhomes and other multifamily options, renewed interest in resale homes near established schools and amenities, and continued competition for single-family homes priced below $1 million.
Builders, meanwhile, are looking for efficiencies behind the scenes.
“We are standardizing,” Wenzel says. “That means fewer custom, one-off plans and more repeatable designs that allow us to purchase materials and schedule trades more efficiently.”
Securing reliable trade relationships earlier and carefully phasing projects and presales can also reduce the time builders carry land and financing costs.
In restoration work, managing costs can require a different strategy.
Corrigan says building-envelope repairs are generally necessary, but some clients postpone them because of budget constraints. The risk is that deterioration continues, ultimately making the repair more expensive. Abris may propose temporary repairs where appropriate or phase work over several years to spread costs.
Proper investigation at the outset is critical, he says, particularly when a property has serious or widespread issues.
“Our experience is that properly investigating an issue is almost always better and more cost-effective in the long run than wasting money and time on a bad plan,” Corrigan says.
That can mean bringing in an engineer before determining the repair strategy, particularly where structural problems or wood rot are involved.
Planning is equally important in residential renovations, where opening walls and floors can reveal conditions that could not be seen beforehand.
Brown points to rot or water damage around improperly installed or failed windows and additional floor-levelling requirements as examples. But he distinguishes those genuine unforeseen conditions from structural, electrical or plumbing requirements that can often be investigated before construction begins.
At Rusch, Brown says structural work, electrical, plumbing and finishes are essentially determined and priced in advance, with unforeseen conditions typically accounting for less than two per cent in change orders on its projects.
He also cautions homeowners against saving money on work behind the finishes, including waterproofing, structural work, electrical, plumbing and proper installation.
“There’s an old saying that if you think it’s expensive to hire a professional, wait until you hire an amateur,” Brown says.
For new home affordability, Wenzel argues that some of the levers sit with governments as well as industry. He supports infrastructure investment but says new costs are repeatedly passed to the next homebuyer.
He points to Canada Mortgage and Housing Corp. research finding that significantly reducing or eliminating development charges could increase the number of viable projects in some cities, with the impact varying by market.
Wenzel would like to see shorter approval timelines, closer scrutiny of levies and code requirements, greater investment in apprenticeships and trades training, and better coordination of infrastructure funding.
The workforce question will not disappear quickly. Wenzel says Canada is already short more than 100,000 certified tradespeople, with retirements expected to make the shortage worse. At the same time, Calgary’s continued population growth is adding to housing demand.
Corrigan similarly expects construction and renovation costs to keep rising steadily, given the broad economic and geopolitical pressures affecting the industry.
Brown’s advice for homeowners is to approach cost control through planning rather than shortcuts. Understanding the full scope early, deciding where to invest and where to simplify, and choosing qualified professionals can prevent expensive corrections later.
Across new construction, restoration and renovation, the message is remarkably consistent: there is no single culprit behind today’s higher costs – and no single solution. Materials and labour still matter, but so do trade policy, transportation, approvals, code requirements, project planning and the cost of waiting.
In a market where few of those pressures appear likely to disappear, managing construction costs increasingly means controlling the factors that can be controlled before the first shovel hits the ground.