A new report by Rennie is raising alarm bells for Metro Vancouver’s condo market: we could see a 60% spike in unsold inventory by the end of 2025.
Yes, you read that right—thousands of brand-new condo units may sit empty by the end of this year. So what’s really going on? And more importantly, what does it mean for you?
Hi, I’m Oleg, a local real estate agent with over 10 years of experience in Vancouver. Let’s break down the data, explore why this is happening, and talk about what it means whether you’re a buyer, seller, or investor.
📊 Where Is This Number Coming From?
Rennie just released their Spring Market Outlook for 2025, and here’s what it shows:
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2,100 completed but unsold new condo units are currently on the market.
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Based on current absorption rates, that number is expected to rise to 3,500 by year-end—a 60% increase in just a few months.
🔍 What’s Causing the Spike in Inventory?
There’s a combination of obvious and not-so-obvious reasons behind the looming oversupply:
1. High Interest Rates
Borrowing costs surged over the past couple of years. While rates are trending downward and the Bank of Canada is holding steady, confidence remains low among both homebuyers and investors.
2. Falling Investor Confidence
Investor participation in pre-sale condos has dropped sharply:
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Down from around 50% in 2021–2023
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Now hovering around 26% in 2024
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Expected to fall further in 2025
3. Government Policy Changes
Recent policy shifts have shaken the market, including:
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The effective ban on short-term rentals
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Proposed capital gains tax increases (even if partially walked back) These have discouraged both local and international investors.
4. International Trade Tensions
The ongoing tariff issues with the U.S. are impacting both construction costs and consumer confidence, affecting both the pre-sale and resale housing markets.
🤔 Less Obvious Factors Behind the Inventory Surge
5. A Wave of New Completions
We saw record housing starts in 2022 and 2023. Now those projects are completing—and flooding the market with new inventory.
6. Changes to Development Financing Rules
In Fall 2024, changes to the Real Estate Development Marketing Act extended the timeline developers have to sell 70% of a building from 12 to 18 months. While this gives them more time to secure financing, it’s also delaying clearance of unsold inventory and increasing total supply on the market.
💡 What Does This Mean for You?
Whether this is good or bad news depends entirely on your role in the market.
🏡 If You’re a Buyer:
This is your moment.
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More inventory = more choices
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Greater negotiating power
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Downward pressure on prices
Even if you’re not buying pre-construction, the ripple effect across the resale market will benefit you.
📉 If You’re a Seller:
You need to be strategic and competitive.
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Focus on today’s prices, not what your neighbor sold for 2 years ago.
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Understand the current market conditions and buyer expectations. If you’re selling a newer condo, especially, you’ll need to stand out on pricing and presentation.
💰 If You’re an Investor:
This is a mixed bag.
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Rents may decline by 4–5% over the next 12 months
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But you gain negotiating power and access to better deals If you can buy the right unit at the right price, you may still come out ahead despite the softer rental market.
📈 Looking Ahead: Not All Doom and Gloom
While short-term challenges are real, there’s room for optimism in the long term:
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Developers are shifting focus to purpose-built rental buildings, which are easier to finance and in high demand.
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Housing starts are down in 2025, meaning by 2027–2029, we could see a supply shortage in for-sale condos again.
In other words, the market is adjusting, and this temporary oversupply could create buying opportunities today and balance in the years ahead.
Final Thoughts
Yes, we might see a spike in unsold condo inventory. But no, it’s not the end of the world. It’s a natural part of a cyclical real estate market—and if you’re informed, you can use it to your advantage.
I’ll continue keeping you up to date on the Vancouver real estate market. If you’re looking to buy, sell, or invest, or even if you just want advice, feel free to reach out anytime. My contact info is below.
Thanks for reading!