A number of real estate experts see a rumbling storm on the horizon for Vancouver’s condo market, one that’s been brewing since 2022.
According to the Canadian Mortgage Housing Corporation (CMHC), around 2,500 condos are sitting vacant in Metro Vancouver, double the amount from a year ago. Why? A flurry of reasons have been suggested by those in the know.
Anne McMullin, president and CEO of Urban Development Institute, told CBC News (1) that residents are moving in as condos cost more to build than nearly 80% of Metro Vancouver residents can afford.
Developers on the other hand, are in a pinch — they don’t want to lose money on a condo sale, but also can’t sit with a vacant unit either. As a result, McMullin revealed how some developers have been giving consumers their deposits back because they aren’t meeting pre-sale targets.
Most alarmingly, other developers have started laying off staff or even going into receivership because of the market’s stagnation.
How empty units impact the housing market
Condo markets having an abundance of excess supply in Vancouver could mean a potential jumping-in point for first-time homebuyers. According to the Greater Vancouver Realtors, the amount of properties sitting on the Multiple Listing Service (those for sale) is just under 15,000 — that’s over 36% below the 10-year seasonal average the association noted (2).
However, BC isn’t the only place with a glut of supply. Recently, the Building Industry and Land Development Association is calling for government intervention in the Greater Toronto Area (GTA) given plummeting sales in the region (3).
There were only 300 new homes sales in August of this year, Altus Group noted, which is 81% below the 10-year average and 42% below August 2024 levels.
What do these patches of excess supply across Canada mean for buyers?
What this means for prospective buyers
Generally speaking, with more inventory comes softening prices if demand doesn’t increase to match pace. Combined with a recent interest rate cut, places like BC and the GTA could be a buyers haven for the fall.
“Easing prices, near-record high inventory levels, and increasingly favourable borrowing costs are offering those looking to purchase a home this fall with plenty of opportunity,” Andrew Lis, director of economics and data analytics for Greater Vancouver Realtors, said in a release.
Meanwhile, the Canadian Real Estate Association (CREA) noted in its recent fall release that the residential home average price across the country is sitting at just under $700,000 as of January 2025 (4).
That said, this excess supply in places like BC and the GTA also shows that consumers aren’t able to purchase what is currently on the market. For that to happen, there may need to be a price correction in the market.
How you can navigate this fall’s housing market
For many Canadians, the price of a home is feeling exceedingly out of reach. What can they do to cope? Here are some tips.
- Wait for the right time. Markets in areas like Vancouver and the GTA could face a pricing correction in the future with the amount of excess supply that is on hand. Wait for prices to turn downward before making a purchase, especially as the Bank of Canada just cut interest rates — this could fuel demand as mortgage rates drop.
- Don’t jump at perks. A number of developers have offered perks to potential buyers to lessen the strain on themselves (e.g. extra amenities, parking). While these benefits can be nice, make sure you can still afford the property. Getting the bells and whistles for free doesn’t matter if you can’t afford what they hang on.
- Take advantage of high supply. While there is an argument that you should wait for a market correction, there’s also an argument that you should watch for developers trying to get out of a bad situation. Some builders may try to sell off units to lower their vacancy rate, even if it means taking a loss. Keep your eyes peeled for deals during high-supply periods.
Housing in Canada can feel like it isn’t getting any cheaper. But, as supply continues to increase in key areas like Toronto and Vancouver, consumers are telling markets they can’t afford what’s being sold. If a price correction is in the cards for the fall, especially if interest rates are cut once more, make sure to keep your money deposited in the right savings account in the meantime, like a TFSA or FHSA.
Article sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
CBC News (1); Greater Vancouver Realtors (2); Building Industry and Land Development Association (3); Canadian Real Estate Association (4)
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.