The Vancouver condo market, long a bastion of seemingly unstoppable growth, appears headed for a notable cooling period that could stretch well into 2026, according to new analysis that’s raising eyebrows among investors and homeowners alike.
A recent forecast from Central 1 Credit Union paints a sobering picture for a market that has defied gravity through multiple economic cycles. Their analysis suggests Vancouver’s condominium sector faces headwinds powerful enough to suppress price growth for approximately two years—a timeline that could reshape expectations for both developers and buyers.
“We’re looking at a period where supply will finally catch up with and potentially overtake demand,” explains Bryan Yu, Chief Economist at Central 1. “This isn’t a crash scenario, but rather a period of adjustment after years of imbalance.”
The forecast points to several converging factors creating this unusual downturn. High interest rates continue to strain affordability despite recent Bank of Canada cuts, while a surge in newly completed units is hitting the market precisely as demand softens. Statistics Canada data shows housing starts in Metro Vancouver reached multi-year highs in 2021-2022, with many of those units now approaching completion.
What makes this situation particularly noteworthy is how it contrasts with Vancouver’s detached housing market, which has shown surprising resilience. Single-family homes have maintained stronger price stability, likely due to their finite supply and appeal to buyers with deeper financial resources.
For everyday Vancouverites, this forecast carries mixed implications. First-time buyers might find welcome relief after years of being priced out, while current owners may need to adjust their expectations around equity growth.
“I’ve watched three friends pull their condos off the market after getting lowball offers,” says Melissa Chen, a tech worker who purchased a Yaletown condo in 2020. “They’re choosing to rent them out instead of selling at a loss.”
The shift comes against a backdrop of changing migration patterns. While British Columbia continues to see population growth, the rate has moderated from pandemic-era peaks. Data from BC Stats indicates that interprovincial migration slowed in late 2023, removing some pressure from housing demand.
Adding complexity to the market outlook is the unusual dichotomy between pre-construction and resale units. Pre-construction prices remain stubbornly high, propped up by developers facing increased construction and financing costs. Meanwhile, resale units face more immediate pricing pressure, creating a disconnect that market observers find concerning.
“Developers are caught between rising costs and market realities,” notes urban economist Jock Finlayson. “Many projects that made financial sense at 2021 interest rates now face challenging economics.”
This mismatch has already triggered project cancellations across the Lower Mainland. The Urban Development Institute reports that approximately 15% of planned multi-family developments have been paused or scrapped entirely since interest rates began rising in 2022.
For prospective buyers, the forecast suggests patience could be rewarded. A two-year horizon provides time for market conditions to realign, potentially offering entry points that haven’t existed since pre-pandemic days. However, timing such opportunities remains notoriously difficult.
“We’re telling clients to focus less on timing the absolute bottom and more on their long-term housing needs,” explains Cameron McNeill, a veteran Vancouver real estate marketer. “Buyers who find a property that meets their five to ten-year plan shouldn’t necessarily wait for further drops.”
The rental market implications also warrant attention. As fewer condos are built and investors potentially exit the market, rental supply—much of which comes from investor-owned condominiums in Vancouver—could tighten further. This could exacerbate an already challenging rental situation in a city with consistently low vacancy rates.
Government policy responses add another layer of uncertainty. BC Housing’s recent emphasis on purpose-built rental development might help offset some rental pressures, but these projects typically take years to complete. Meanwhile, the province’s speculation tax and the city’s empty homes tax continue to influence investor behavior in ways that economic models struggle to fully capture.
For Vancouver’s economy more broadly, a condo market slowdown presents both challenges and opportunities. Construction employment, a significant economic driver in the region, could face pressure if developers continue delaying new projects. Conversely, housing affordability improvements could help Vancouver businesses attract and retain talent that has increasingly sought more affordable regions.
Perhaps most intriguing is what this forecast reveals about the changing psychology of Vancouver’s real estate market. After decades where “housing always goes up” became an unquestioned mantra, a two-year corrective period signals a more mature market where cyclical patterns are acknowledged.
As with any forecast, uncertainty remains. A more aggressive Bank of Canada easing cycle could accelerate market recovery, while renewed immigration could quickly absorb excess supply. What seems increasingly clear, however, is that Vancouver’s condo market has entered unfamiliar territory—a reality check that many market participants are still coming to terms with.
