Photo: Sebastian Stephan Thiel/Flickr
Demand for new condos plunged in 2019 in Metro Vancouver and the region’s developers responded accordingly, cutting the number of condo units launched by 60 percent when compared to 2018’s total.
Vancouver-based new condo market research firm Urban Analytics found that 7,588 units launched in the region during 2019, a far cry from the 18,998 that hit the pre-construction market just a year prior.
It was the region’s weakest result for condo launches in years and follows three consecutive years that saw units hitting the market number in the 17,000 to 19,000 range. Annual totals dating back to 2012 showed it was also a low-point even with an expanded time horizon as condo launches have numbered in the five-digit figures each year, with 2019 now being the sole exception.
Set against the backdrop of a broader real estate market that spent the entire year ailing, the steep drop in Metro Vancouver condo launches should not come as a surprise. Not only did condo launches and new condo buying slow down considerably last year, 2019 also saw sales in the resale market drop off a cliff and luxury home buying dry up almost entirely.
In comments made to The Vancouver Sun, Urban Analytics President Michael Ferreira noted that the drop in launches was hardest felt in the high-rise condo segment of the market. Developers concerned with their prospects of selling enough units in the pre-sale stage to obtain their bank financing stepped to the sidelines.
Ferreira also told the Sun that condo market investors that had previously played an outsized role in the new construction market were no longer the driving force they once had been. Developers are noticing their absence and scaling back their efforts until demand ramps back up.
According to BuzzBuzzHome data, there are 5,753 new construction units currently under construction in the City of Vancouver market. If the pullback in new launches continues into the early 2020s, there may be more housing supply challenges in the region’s future.
