Vancouver Developers Face Rising Concern Over Thousands of Unsold Condos

Vancouver’s once red-hot condo market is cooling fast, and developers are sounding the alarm.

According to the Canada Mortgage and Housing Corporation (CMHC), roughly 2,500 brand-new condos are sitting unsold across Metro Vancouver—twice as many as a year ago. Industry leaders say the glut of empty units could lead to cancelled projects, layoffs, and even bankruptcies if the slowdown continues.

“Costs have escalated so much in the last 10 years that to build a unit is out of the price range of 80 per cent of the public in Metro Vancouver,” said Anne McMullin, president of the Urban Development Institute. “You’re not going to build to lose money.”

Developers say they’ve been squeezed by rising labour and materials costs, combined with new government policies around rental housing, energy standards, and community amenities. Some builders are already refunding deposits because they can’t meet pre-sale thresholds needed for bank financing, while others have slipped into receivership.

“This is a potential storm coming, and it’s frightening,” McMullin said.

The slowdown has been building since 2022 but has intensified over the past year, said Greg Zayadi, president of Vancouver-based firm Rennie. “The last time we saw this level of developer-owned unsold inventory was 24 years ago.”

Part of the problem, Zayadi said, is mismatched expectations. Buyers spending $800,000 don’t want a 500-square-foot condo—they want something closer to 1,000 square feet. “We need to deliver inventory at $700 to $900 per square foot,” he said, well above where the market sits today.

Much of the unsold inventory is clustered in Burnaby, Coquitlam, and parts of Surrey, according to Zayadi.

Real estate agent Oleg Galyuk added that older, larger condos are often selling more quickly than brand-new ones. Many of the new units, he said, have awkward layouts, fewer parking options, and were built with investors in mind rather than families.

To lure buyers, developers are now offering perks like free parking stalls, storage lockers, or cash-back on completion. But Galyuk says those incentives only go so far. “Right now, a lot of condos coming online are ones people don’t really want to live in.”

For an industry that boomed for two decades, the warning is clear: unless affordability and design catch up to demand, the slowdown could become a full-blown downturn.