What Happened

The number of completed and unsold condos and townhomes in Metro Vancouver climbed to 3,215 units in the second quarter of 2025, according to data from Zonda Urban. This marks a sharp increase from the 2,304 units recorded in the first quarter of the same year. The surge reflects a market where investors have largely exited, leaving developers with a heavy inventory of new units that are too pricey or too small for owner-occupiers. While the Canada Mortgage and Housing Corporation estimates the number of completed unsold condos is around 2,500 and could rise by year’s end, the Zonda Urban data includes townhomes in its count. Rennie Intelligence, which tracks the market using a different methodology, reported 3,059 total empty and unsold units in projects nearing completion and completed by the second quarter of 2025. This figure was derived after the firm shifted its methodology to rely on actual site progress rather than projected completion dates, pushing many expected completions to 2027 or 2028. The investor share of buyers has plummeted from about half of the market between 2021 and 2023 to just 7% in the first quarter of 2025. Most of the vacant inventory consists of concrete highrise condos in Richmond, Burnaby, New Westminster, Vancouver West, and Coquitlam. These units are typically priced between $800,000 and $1.2 million, with sizes ranging from 790 to 870 square feet. The unsold stock is spread across 90 projects, with 15 projects containing almost half of the total vacancy. Developers have suggested policy changes, such as expanding GST rebates to all new homebuyers for homes up to $1.5 million, to help clear the inventory. However, the provincial government has stated it will not be changing the foreign buyer tax despite industry suggestions. Andy Yan, director of the City program at Simon Fraser University, noted that it remains difficult to measure the full extent of the situation in the industry. Jon Bennest, vice-president of product development at Zonda, explained that investor motivation depends heavily on expected price increases upon construction completion. Anne McMullin, president and CEO of the Urban Development Institute, suggested that expanding GST rebates could help stimulate demand for new homes.

Why It Matters

The doubling of unsold inventory in Metro Vancouver signals a significant shift in the new condo market, driven by the departure of investors who previously accounted for a substantial portion of sales. With investor share falling to just 7% in the first quarter of 2025, developers are left with a large stock of units that are often too expensive or too small for owner-occupiers. This situation ties up developer capital, potentially risking future housing projects and jobs in the region. The mismatch between the product being built and the needs of current buyers highlights the challenges in aligning new supply with market demand. As completion dates are pushed to 2027 or 2028 due to methodological changes in tracking, the timeline for clearing this inventory extends further into the future. The industry's call for policy changes, such as expanded GST rebates, underscores the pressure on developers to find solutions to reduce the backlog. The provincial government's refusal to alter the foreign buyer tax adds to the complexity of the situation, limiting one potential lever for stimulating demand. This inventory buildup affects market liquidity and confidence, as unsold units represent a significant financial burden for developers and a potential oversupply risk for the broader housing market.

Local Vancouver / Burnaby Context

The Metro Vancouver new condo market has experienced a notable shift in buyer demographics, with investors significantly reducing their presence. This trend is particularly evident in areas like Richmond, Burnaby, New Westminster, Vancouver West, and Coquitlam, where most of the vacant inventory is concentrated. The shift away from investor-driven demand has left a large number of units unsold, impacting the overall market dynamics. The change in Rennie Intelligence's methodology to track actual site progress rather than projected completion dates has further highlighted the extent of the inventory buildup, with many completions now expected in 2027 or 2028. This methodological shift has reduced the number of units considered to be nearing completion, providing a more accurate picture of the current market state. The geographic distribution of empty units across various regions, including Burnaby/New Westminster, Richmond/South Delta, and Tri-Cities, indicates a widespread issue rather than a localized one. The high proportion of concrete highrise condos in the vacant inventory reflects the types of developments that were popular during the peak investor years. The pricing of these units, often between $800,000 and $1.2 million, places them out of reach for many first-time buyers, while their smaller sizes appeal less to those seeking family homes. The industry's suggestion to expand GST rebates to all new homebuyers for homes up to $1.5 million is a direct response to these challenges, aiming to make new homes more affordable and attractive to owner-occupiers. The provincial government's stance on the foreign buyer tax remains unchanged, leaving developers to navigate the current inventory situation without that particular policy adjustment. The decline in investor interest is a key factor in the current market landscape, influencing both supply and demand dynamics in the region.

Market Impact

The large volume of unsold condos in Metro Vancouver is likely to exert downward pressure on new condo prices, particularly in the mid to upper price range. Developers may face increased competition for buyers, leading to potential price adjustments or incentives to clear inventory. The shift in buyer demographics from investors to owner-occupiers means that new condos must compete more directly with the resale market, where older units with larger floor plans are often preferred. This competition could slow the absorption rate of new projects, extending the time it takes for developers to sell their units. The financial strain on developers due to tied-up capital may lead to a reduction in new project starts, potentially affecting future housing supply. The market may also see a greater emphasis on smaller, more affordable units to attract first-time buyers, as the current inventory of larger, more expensive units faces slower sales. The overall market liquidity for new condos could decrease, making it more challenging for developers to secure financing for new projects. The sentiment among buyers may become more cautious, with greater scrutiny on pricing and value proposition. The impact on land values in areas with high inventory buildup could be negative, as developers reassess the feasibility of new acquisitions. The market may also experience a shift in focus towards rental properties, as investors look for alternative investment opportunities with more stable returns.

Builder / Developer Perspective

Developers are facing significant challenges due to the large volume of unsold condos in Metro Vancouver, with inventory levels doubling in the first half of 2025. The departure of investors, who previously accounted for a substantial portion of sales, has left developers with a heavy stock of units that are often too expensive or too small for owner-occupiers. This situation ties up developer capital, potentially risking future housing projects and jobs in the region. The shift in Rennie Intelligence's methodology to track actual site progress has further highlighted the extent of the inventory buildup, with many completions now expected in 2027 or 2028. Developers have suggested policy changes, such as expanding GST rebates to all new homebuyers for homes up to $1.5 million, to help clear the inventory. However, the provincial government's refusal to alter the foreign buyer tax adds to the complexity of the situation. The financial strain on developers may lead to a reduction in new project starts, potentially affecting future housing supply. Developers may also need to adjust their product mix to better align with the needs of current buyers, such as offering smaller, more affordable units. The market may see a greater emphasis on rental properties, as developers look for alternative investment opportunities with more stable returns. The overall feasibility of new projects may be reassessed, with developers considering the impact of high inventory levels on pricing and sales velocity.

BurnabyHouse Insight

The Metro Vancouver new condo market is undergoing a significant transformation, driven by the departure of investors and the shift in buyer demographics towards owner-occupiers. This shift has left developers with a large volume of unsold inventory, particularly in areas like Richmond, Burnaby, and New Westminster. The doubling of unsold units in the first half of 2025 highlights the challenges in aligning new supply with current market demand. The industry's call for policy changes, such as expanded GST rebates, underscores the pressure on developers to find solutions to reduce the backlog. The provincial government's stance on the foreign buyer tax remains unchanged, adding to the complexity of the situation. The market is likely to see more competitive pricing and potential incentives from developers looking to clear inventory, as well as a greater emphasis on smaller, more affordable units to attract first-time buyers. The overall market liquidity for new condos may decrease, making it more challenging for developers to secure financing for new projects. The sentiment among buyers may become more cautious, with greater scrutiny on pricing and value proposition. The impact on land values in areas with high inventory buildup could be negative, as developers reassess the feasibility of new acquisitions. The market may also experience a shift in focus towards rental properties, as investors look for alternative investment opportunities with more stable returns.