Vancouver Real Estate 'Bubble' at 30-year Peak

[GenWhy?]

Judging by low voter turnout it doesn't seem to be much of an issue to the general public (or at least where the impact is felt the most - not the Feds)

[GenWhy?]

"In March 2025, the benchmark price of a detached home [LOT] rose to $2,034,400, nearly $335,000 more than in March 2021. There were 527 sales, way down compared to 2021. However, active listings were up significantly to 5,110. A detached house spent 35 days on the market on average.

Apartment prices also rose, though not as significantly as detached homes. Last month, the benchmark price of a Greater Vancouver apartment was $767,300 (+$51,500). There were 1,084 sales and 6,672 active listings, and an apartment listed spent an average of 28 days on the market..."

One thing that these article rarely ever mention is when buying a detached you're really buying the land and underlying development potential. While an apartment purchase the land has already been developed.

There were some key policy changes from 2021-2025 that can explain higher land prices for Vancouver's lots that have detached homes on them, if that's referring to lots with ONLY detached homes on them and not containing laneways or basement suites already.

[seamusmcduff]

I've been frustrated about this for years, hopefully we do something about it. Hard to build housing when we're offloading all infrastructure costs onto new developments

The Housing Tax Crisis

https://www.youtube.com/watch?v=ZEUR9bj89lo

[whatnext]

So, are we finally riding the popping bubble down? Prices remain oddly sticky considering the dismal state of sales. Article from the G&M is national in scope but lots of Vancouver stuff.

Residential real estate developers cut jobs as downturn deepens
Rachelle Younglai Real Estate Reporter
Published 10 hours ago
Updated 3 hours ago
For Subscribers

Norm Li had to lay off 75 per cent of his staff at his eponymous company that makes renderings and other visual content for real estate developers as the Canadian residential development industry faces the worst downturn since the 1990s recession.

Mr. Li, who has been running his business since the early 2000s, said he watched as more developers put projects on hold, cancelled them or were forced into receivership. And then his company’s work dried up.

“I tried to hold on for a long time and I tried to keep it all together, but then one day, I saw it. I knew if I don’t lay these people off today, the next payroll, the bank is going to come shut me down,” he said....

....In other Ontario regions such as Kitchener-Waterloo and Hamilton, the annualized preconstruction condo sales for the six months ended in March were about 80 per cent lower than the 2020 to 2024 annual average, according to Altus Group. Ottawa’s annualized sales were 70 per cent below that 2020-2024 average while Montreal, Edmonton, Vancouver and Calgary were down between 62.5 per cent to 50 per cent, according to Altus....

....Wesgroup said it has had to delay a number of projects because the economics no longer worked. The Vancouver-based developer has cut 12 per cent of its work force this year.

“We’ve worked hard to avoid workforce reductions, but like many of our peers, we’ve reached a point where we must realign our operations for long-term sustainability,” Wesgroup president Beau Jarvis said in an e-mailed statement.

Polygon Realty, which has built 34,000 homes in the Vancouver area over the past 45 years, started by not replacing employees who decided to leave. But this week it had to cut about 5 per cent of its work force...

....In the Vancouver region, one of the dominant preconstruction sales brokerages, MLA Realty, laid people off in March.

MLA helps developers with the design, marketing and sales of new condos as well as the leasing of rental buildings. It has sold about 10 per cent of the new homes built in the Vancouver region over the past decade...

...McNeill said he had to restructure the company. His work force is now 35-per-cent lower than a year ago. “We had to make some really difficult decisions,” he said.

Mr. McNeill said his company is doing more advisory work and representing more smaller wood frame projects that are typically geared to buyers who plan to live in the homes. He believes the Western market will be difficult for at least another year even though he has seen more optimism from developers....(bold mine)

https://www.theglobeandmail.com/business/article-real-estate-jobs-downturn-homes-decline/

The bolded part made me laugh. Maybe that was a big part of the problem!

[Changing City]

Originally Posted by whatnext

So, are we finally riding the popping bubble down? Prices remain oddly sticky considering the dismal state of sales.

You seem to be conflating two markets. Prices for resale homes in the Greater Vancouver market have been essentially flat for three years (so they're slightly 'more affordable', given inflation over that period). Mortgage rates are still slightly higher than they were three years ago, but were higher at the end of 2023, and have dropped in the past 18 months. Sales have dropped, as investors no longer see the prospect of higher values that they were able to achieve over the previous years.

Combined with the restrictions on Airbnb and foreign buyers, larger new developments have had difficulty getting enough buyers to make projects work financially. A few developers have failed in the past few years, due to excessive debt and little prospect of building their way out of that debt. Prices for new condo developments don't seem to have fallen, because developers are obviously not going to build at a loss. Instead, so have put projects on hold, and others have pivotted their projects to rental. So condo starts are down, but starts of rental projects are (in some municipalities) up.

So bubbles don't appear to be popping. Some air seems to be coming out of the resale market, and the new condo market is just a smaller bubble, for now.

You can paint any number of scenarios for where we go from here - a lot of them determined by what happens to the south. If Trump succeeds in ousting Jerome Powell from the Fed, and installs someone who agrees that the US interest rate should be 2 or 3% lower, then Canadian rates would almost certainly have to be lower, and our housing market could take off again. (Some Canadian markets have seen continuing price increases in the past 3 years). There are already signs that the 'debt cliff' that borrowers were once facing, refinancing mortgages they took at low rates during the early days of the pandemic, isn't much of a problem for most of them. Many had variable rate mortgages, so they're already used to having to pay more. Obviously if we went into recession, there would be a totally different picture, but so far that's not been the case.

[Alex Mackinnon]

Price per square foot as a metric appears to be falling pretty decently now. That's the only metric I care about.

Nobody wants to buy a 450 sqft junior 1 bedroom dog crate to live in for the long-term. It was all BS investor demand with next to no apatite for people to live in them. That's going to drive the average price upwards.

I've been watching quite a few detached properties terminate their listings or relist at significantly lower prices. Quite a few decent houses in my neighbourhood have relisted down several hundred thousand and are still sitting stale.

Have a look here at "sold prices per SqFt".
Link

[whatnext]

Gee, I wonder might have happened to cause this...
And someone might want to ask Daisy why global economic uncertainty doesn't seem to have impacted Calgary or Montreal.

Vancouver luxury home sales plummet amid economic uncertainty
Residential sales over $4M dropped by half compared to the first half of last year.
Daisy Xiong
about 6 hours ago

The City of Vancouver’s luxury housing market has taken a hit amid economic and geopolitical uncertainty, according to a new report.

Sales of residential properties priced at $4 million and above in the first half of 2025 fell by 51 per cent compared with the same period last year—the steepest decline among Canada’s major cities, according to a Wednesday report from Sotheby’s International Realty Canada.

The luxury real estate brokerage recorded only two transactions above $10 million, down from seven during the first half of 2024. Sales of properties priced over $1 million also declined, dropping 26 per cent during this time...

....Toronto’s luxury market also contracted sharply, with a 23 per cent year-over-year drop in sales of homes over $4 million and a 13 per cent decline in sales of homes over $1 million.

Meanwhile, Montreal and Calgary saw gains in these segments, with sales of homes over $4 million rising by 22 per cent and 43 per cent, respectively, and sales over $1 million up by 26 per cent and three per cent....

https://www.biv.com/news/real-estate/van...ummet-amid-economic-uncertainty-10947692

[jollyburger]

Home sales in the Lower Mainland showed signs of improvement in June, remaining low but gaining traction as economic uncertainty eased and affordability improved, drawing in more buyers.

Multiple Listing Service (MLS) sales in the area, which spans Metro Vancouver and Abbotsford-Mission, reached 3,325 units. While this was 9.5 per cent lower than a year ago, it marked a narrower decline compared to the 19.5-per-cent drop seen in May. June’s sales were the fewest for that month since 2000, just shy of 2019 figures.

Sales flow showed mild momentum, with calculations pointing to a five per cent seasonally adjusted monthly gain, though still well below late 2024 and pre-pandemic levels. Data for Greater Vancouver indicates a more significant drop in apartment sales, down 16 per cent year over year, while other product types stabilized.

Many buyers held back earlier this year due to trade war uncertainty and risks to the job market. While the regional economy is less at risk, high-priced urban markets have experienced the sharpest sales reductions due to potential impacts on mortgage servicing. As uncertainty abated, buyer sentiment improved. Meanwhile, easing prices and mortgage rates also led to improved affordability, which likely boosted sales.

Nevertheless, the sales environment remains shallow, and excess supply persists. New listings rose five per cent year-over-year, and inventory continued to trend higher. Active listings increased 26.5 per cent year-over-year to 26,800 units. While monthly growth has slowed, the trend is the highest since 2013. The market continues to favour buyers, with a sales-to-active listing ratio of 12.4 per cent indicating ample housing choice. Adding to MLS inventory is an overhang and growing number of newly completed apartment condominiums that are finished but unsold.

The average price for units sold in the region reached $1.19 million during the month, up 1.2 per cent month over month (6.3 per cent seasonally adjusted). The year-over-year decline narrowed to four per cent from six per cent in May. This reflected stronger sales performance in core Metro Vancouver markets and a slower pickup in the lower-priced Fraser Valley region. The sales composition, leaning towards detached homes, also boosted average prices. The average price is about nine per cent off the 2022 peak. Further declines in home values are expected given the inventory overhang and economic weakness. However, improving affordability and significant demand on the sidelines are likely to draw in more buyers and stabilize prices.

Canada’s trade picture remains soft in May
Canada’s trade picture remained soft in May as the impact of tariffs on the economy persisted. Exports increased by 1.1 per cent in May to $60.8 billion, following an 11-per-cent decline in April. Imports decreased by 1.6 per cent to $66.7 billion. As a result, the trade deficit contracted from a record high of $7.6 billion in the prior month to $5.9 billion.

Exports to the U.S. continued to decline for a fourth straight month in May, down 0.9 per cent, following significant tariffs on Canadian goods. Imports from the U.S. dropped by 1.2 per cent. The proportion of exports to the U.S. also continued to shrink to 68.3 per cent, compared to the 2024 monthly average of 75.9 per cent. However, exports to other countries reached an all-time high, growing by 5.7 per cent.

Although provincial data is unadjusted for seasonality, British Columbia saw lower merchandise exports in May on a year-over-year basis. Exports continued to decline for the second consecutive month, falling 3.1 per cent (down $139.6 million) to $4.4 billion. This was primarily due to lower forestry products and building and packaging materials, which decreased 15.8 per cent year-over-year (down $173.9 million). Consumer goods exports also declined 11.8 per cent (down $45.5 million), while farm, fishing and intermediate food products exports decreased 13.5 per cent (down $37.4 million). These declines were slightly offset by higher exports of metal ores and non-metallic minerals, up 15 per cent (an increase of $61.1 million), and electronic and electrical equipment and parts exports, which increased 15.8 per cent (an increase of $43.1 million).

On a yearly basis, non-seasonally adjusted imports to B.C. declined 1.3 per cent (down $84.9 million) to reach $6.3 billion. Energy products imports posted the largest decline, down 55.5 per cent (down $175.7 million). Motor vehicles and parts imports also decreased 14.5 per cent (down $96.5 million), while aircraft and other transportation equipment and parts imports decreased 34.4 per cent (down $95.2 million). Conversely, consumer goods imports increased 16 per cent (up $266.6 million).

https://www.biv.com/news/commentary/brya...igns-of-life-at-start-of-summer-10946357

[logicbomb]

Originally Posted by whatnext

Gee, I wonder might have happened to cause this...
And someone might want to ask Daisy why global economic uncertainty doesn't seem to have impacted Calgary or Montreal.

Vancouver luxury home sales plummet amid economic uncertainty
Residential sales over $4M dropped by half compared to the first half of last year.
Daisy Xiong
about 6 hours ago

The City of Vancouver’s luxury housing market has taken a hit amid economic and geopolitical uncertainty, according to a new report.

Sales of residential properties priced at $4 million and above in the first half of 2025 fell by 51 per cent compared with the same period last year—the steepest decline among Canada’s major cities, according to a Wednesday report from Sotheby’s International Realty Canada.

The luxury real estate brokerage recorded only two transactions above $10 million, down from seven during the first half of 2024. Sales of properties priced over $1 million also declined, dropping 26 per cent during this time...

....Toronto’s luxury market also contracted sharply, with a 23 per cent year-over-year drop in sales of homes over $4 million and a 13 per cent decline in sales of homes over $1 million.

Meanwhile, Montreal and Calgary saw gains in these segments, with sales of homes over $4 million rising by 22 per cent and 43 per cent, respectively, and sales over $1 million up by 26 per cent and three per cent....

https://www.biv.com/news/real-estate/van...ummet-amid-economic-uncertainty-10947692

Those junior 1 bedroom dog crates were being sold to foolish prospective investors and landlords thinking we'd see a sustained rate of the unprecedented migration into the region. There's a new apartment residence at the corner of 140 ST and 108 AVE in Surrey that was plagued with people being underhoused with up to 6 people in a 1 bedroom suite. The slowdown in international students has significantly softened the condo market for now.

The lack of demand for these pitifully small suites is now impacting the demand for new builds and redevelopments, which is in turn causing a crash of those lots across areas that were positioned for redevelopment. No shit prices are crashing....a dilapidated home being listed for 6 mil in Vancouver? It's now worth a few mil less without the quick investment potential.

[jollyburger]

https://www.rbc.com/en/thought-leadershi...most-affordable-its-been-in-three-years/

[whatnext]

When you see it like this it is clear how ridiculous Vancouver's housing costs are and how they have become so divorced from local incomes.

Originally Posted by jollyburger

https://www.rbc.com/en/thought-leadershi...most-affordable-its-been-in-three-years/

[Changing City]

Originally Posted by whatnext

When you see it like this it is clear how ridiculous Vancouver's housing costs are and how they have become so divorced from local incomes.

This is not news. Since 1985 the full RBC report shows Vancouver's Housing Affordability at 61.3% of median household income. In the past year it shows an 11.4% improvement in affordability in Metro Vancouver - the highest proportion for the 15 Canadian cities RBC follows.

[mcj]

Originally Posted by Changing City

This is not news. Since 1985 the full RBC report shows Vancouver's Housing Affordability at 61.3% of median household income. In the past year it shows an 11.4% improvement in affordability in Metro Vancouver - the highest proportion for the 15 Canadian cities RBC follows.

Boomers finally realizing the housing market may have been completely screwed up for the last 40+ years

[whatnext]

How odd, I'm pretty sure most of the developers claimed foreign buyers weren't a factor when prices were going up (along with many forumers).

B.C. developers press for easing of foreign investment laws to avoid crash in construction industry
Frances Bula
Rachelle Younglai Real Estate Reporter
Vancouver and Toronto
Published Yesterday
For Subscribers

Major players in B.C.’s housing industry are calling on federal and provincial governments to loosen restrictions on foreign investment in Canadian homes to avoid a crash they say will deepen the country’s housing crisis.

The B.C. industry players have written to Prime Minister Mark Carney and federal Housing Minister Gregor Robertson outlining their concerns. Toronto developers, whose industry is struggling with some of the same challenges, have said they support the measures being urged.

The letter, which was also sent to B.C. Premier David Eby and was obtained by The Globe and Mail, warns that if something doesn’t change, housing supply – beset by high construction costs, high land prices, municipal fees and erratic U.S. tariff policies – will continue its already dramatic slowdown. Housing prices will start to rise as a result, it notes....

... The letter, signed by companies such as Beedie Living, Westbank, Amacon, Cressey and Polygon, argues that having some level of foreign investment to provide the capital for the early stages of condo projects is key.

“New condo development requires presales to meet financing thresholds, part of which relies on investor-focused buyers. Closer to occupancy, sales typically shift more toward owner-occupiers.

“In the absence of foreign investors, fewer projects will meet presale financing thresholds, suppressing supply delivery, which serves no one in a housing crisis as projects will not start,” the letter says....

https://www.theglobeandmail.com/canada/a...d-eby-foreign-investment-housing-supply/

[GenWhy?]

The only major change I've heard is allowing / relaxing rules on foreign buyers is that their purchase is locked into a housing covenant as a rental for 20 years.

[jollyburger]

PCI prioritizes apartment development in Vancouver amid condo slump

“Through uncertain economic conditions and a time when new rental housing construction starts in particular are challenged, we remain committed to, and focused on, adding much-needed new, high quality and well-located rental housing throughout the City of Vancouver,” Grant said.

Grant said PCI's team has been prioritizing rental development in recent years, but still continues to develop condos, including in Surrey, where it is nearing completion of over 800 condos at the latest phase of the King George Hub master plan.

But the regional condo pre-sale market continues to languish with many projects paused, converted to rental. or cancelled entirely.

"Condo development can still be more profitable than rental projects,” Grant said. "You have a defined closing, whereas rental housing is more of a continuing over a longer term.”

"I think that that's rule No. 1 for a real estate developer, particularly in our region, is that you have to have the ability to adapt," Grant said. He said the rental development market has become more attractive over the past 10 years as the city has adjusted or added incentives and opportunities for this type of housing.

He said the market is evolving and PCI recognizes the need for high-quality rental homes in volume, and especially in locations well connected by transit.

The surge in rental development has helped improve availability of rental homes and softened rental rates, which is important for the city and the region. “Renters have more choice,” Grant said.

https://renx.ca/pci-prioritizes-apartment-development-in-vancouver-amid-condo-slump

[jollyburger]

Hotel Georgia Penthouse Sells For $15.7M In Downtown Vancouver

The penthouse, 4801-667 Howe Street, was listed for sale by Malcolm Hasman of Angell Hasman & Associates (Malcolm Hasman) Realty Ltd. earlier this year with an asking price of $17,800,000, according to REALTORS.ca. Although REALTORS.ca says the sale price is unconfirmed, Zealty.ca said the penthouse was sold on July 18 and that the sale price was reported at $15,750,000 on August 1, after being on the market since April 8, 2025 (101 days).

BC Assessment values the penthouse at $13,911,000 in an assessment dated to July 1, 2024. The buyer is unknown, but was represented by Rennie, according to Zealty.ca.

The penthouse includes four bedrooms, seven bathrooms, and 7,236 sq. ft of luxurious living space, thus the sale price translates to $2,177 per sq. ft. The unit makes up the entire top floor of the building, providing 360° views of downtown Vancouver, in addition to a gourmet kitchen, a second prep kitchen, a billiards room with wet bar, 700-bottle wine storage room, outdoor dining terrace, and building amenities such as an indoor pool, spa, gym, and 24-hour concierge.

https://storeys.com/hotel-georgia-penthouse-vancouver-sold/

[whatnext]

Originally Posted by jollyburger

https://storeys.com/hotel-georgia-penthouse-vancouver-sold/

And it only took 12 years.

I wonder if any journalist will use the Land Transparency Ownership Registry to report on who bought it. (Hint, hint Howard Chai).

[whatnext]

Nobody commented on this piece when it came out a couple days ago. What could Hong Kong, Sydney, San Jose and Vancouver have in common...

Vancouver fourth most expensive city worldwide: report
By Jan Schuermann and Srushti Gangdev
Posted August 6, 2025 6:23 pm.

A new report says Vancouver is “impossibly unaffordable” and ranks just behind Hong Kong, Sydney, and San Jose.

The study from Chapman University is an annual look at affordability across eight countries, comparing median home prices to median incomes...

https://vancouver.citynews.ca/2025/08/06/vancouver-fourth-most-expensive-city-worldwide-report/

[kikin]

Vancouver would rate much more affordable if we actually had jobs and wages to go with it, being a desirable location to live and the best climate in Canada means people will always want to live here and sacrifice financially to do it

dollar for dollar and taking inflation into account, Vancouver real estate really isn't overpriced, it is just hard for the average worker with average skills to afford it and have anything left over to buy overpriced food and coffee