Here we are at the turn of the year and for the real estate market 2025 was a historic one, though not in a celebratory way.
The Vancouver region recorded the fewest annual home sales since the year 2000, a 25-year low (hat tip: Steve Saretsky) – that’s even more stark when you consider the population growth since then. Taking per-capita into account it’s likely we haven’t seen a market with this kind of transaction volume since the 80s. Sales finished the year down roughly 13% year-over-year, as stubborn inventory stacked up and buyer demand fell off.
That sounds pretty grim, so let me cut to the chase for 2026, I do expect sales volume to climb back up again – hitting a 25-year low isn’t likely to be repeated when you understand what caused the stale 2025 market.
Of course, we shouldn’t slip into perceiving all of this as negative, there are opportunities in this equation – take note, upsizers and first-time buyers.
So let’s run through some of the questions we’re hearing:
“Why So Slow?”
As we’ve discussed previously in ‘The Difference Maker’, price was everything last year. For sellers that missed this memo, it meant their homes sat on market, often for months. Buyers in turn saw inventory climbing and became very selective in the properties they’d pursue.
The properties that did sell (and we sold a lot of them, 38% more than in 2024!) had three things in common, they were: 1. Well Priced, 2. Expertly Marketed, and 3. Presented Attractively.
Believe it or not, over the last decade many sellers were able to get away with these three not being the case. They could overprice and the market would catch up with them. They could hire a niece or nephew that just got their real estate license and still sell. They didn’t even have to tidy up, never mind catch up on long neglected maintenance, and they’d still get multiple offers. We’re in a different world now and we have been since 2023; it’s just that last year it became impossible to dismiss.
“Who Cares About Sales Volume? What About PRICES?!”
“Sales volume only really matters to Realtors.” Sure, it’s true that sales volume has a big impact on Realtors, Mortgage Brokers, Developers, etc. but it also matters for the average member of the public too as volume influences price action – so, what happened to prices?
Official benchmark data shows prices down roughly 4–5% year-over-year, but for sellers who had to move, the reality was often closer to 7–10% and those sales have now become the comparables that buyer’s agents are referencing.
Many of the homes that didn’t sell in 2025 are returning to the market in early 2026 and so I expect we’ll continue to see high inventory, especially by those that still believe ‘Spring is the time to sell.’
At the same time, and this is why I expect to see volume climb again, demand will also likely climb as sellers begin to adjust their price expectations, leading to sales, and eventually those sellers also purchasing – the market will get moving again. The time for denial is over for sellers and we’re already beginning to see it in the list prices adjust.
“What About Interest Rates? Won’t They Help?”
It’s been at least a year since interest rates fell back into more normative territory already. I don’t think I heard a single person say to me in 2025 that they weren’t buying because the rates were too high.
As of today, markets are not pricing in rate cuts for 2026, and that would have only impacted variable mortgages anyway. Fixed mortgage rates have remained stubbornly range-bound around 4% for more than a year. Borrowers need to get comfortable with 4% mortgages being the norm for the foreseeable, unless we see some kind of black swan event.
This matters because 2026 marks the peak of the mortgage renewal wave. Many homeowners will be renewing loans written in 2020–2021, when rates were under 2%. For some households, the adjustment will be meaningful, even painful.
“What About Investors?”
Investors were a major source of demand over the last decade, but most stepped away in 2022 and they haven’t returned. The incentives stopped making sense, especially on the back of so much intervention in the market.
Rising borrowing costs, softening prices, falling rents, and increasing vacancy rates have changed the math. In Vancouver, vacancy rates recently hit a 30-year high, while asking rents are down noticeably from their peak.
“You Said There Was Opportunity, Where Is It?”
There are opportunities in every market, and this one is no exception. The biggest opportunities are for first-time buyers and upsizers. We also have to consider early this year as an ‘opportunity’ for anyone looking to sell in the next two years to potentially sell for the highest price they can expect for a while.
First-time buyers have a glut of options in traditional first-time buyer categories, like condos and townhomes. Condo inventory is very high, and the comparable nature of these homes means that ranges stay pretty tight – if a sale occurs, it quickly price adjusts the properties around it.
Upsizers that are able to bear the whole context in mind are seeing that, yes, their current home has dropped in value, but their next home has dropped comparatively more. The gap between condos and townhomes, and townhomes and single family homes, hasn’t been proportionally tighter for a very long time.
Finally, although some might struggle to see it, when I look in my magical real estate crystal ball I think it’s important for sellers to consider if this is the best opportunity they’ll see for a couple of years to sell for the highest price they can expect without a time machine. If sellers don’t just look backwards but look forwards, then selling is also an ‘opportunity’ right now.
“So, What Does 2026 Look Like?”
Based on what we know today, I expect prices to continue to decline marginally in most markets, but for sales volume to increase, leading to a bit more support. It’s not a crisis, but there’s also not a quick rebound imminent.
Sellers that have adjusted their expectations may be surprised to see their properties actually selling, as opposed to their neighbours. Buyers have some incredible opportunities already. Investment focused properties are going to continue to struggle, especially with so much unsold pre-sale inventory.
As we head into 2026, the opportunity isn’t in trying to time a rebound. It’s in understanding the market we actually have, making thoughtful decisions within it, and still achieving your goals!
If you’re considering buying, selling, or just want to understand how these trends apply locally, we’re always happy to talk it through.