The Greater Vancouver real estate market showed further signs of cooling in May, as active listings surged to their highest level in over a decade and monthly sales dropped well below historical norms. A convergence of rising inventory, evolving mortgage policies, and political uncertainty has shifted the regional market into a more cautious and supply-driven phase.
According to the latest report from the Greater Vancouver Realtors (GVR), total residential sales in May reached 2,228 transactions, down 18.5% from May 2024 and 30.5% below the 10-year seasonal average of 3,206 sales【3】. This marks one of the slowest spring periods since 2019, despite a traditionally strong season for home buying.
Weak Spring Rebound Raises Concerns
Historically, the period from January to April sees sales volumes increase by roughly 79% as the spring market gains momentum. In 2025, however, that seasonal surge failed to materialize—sales rose by only 34% over the first four months of the year【1】.
Industry analysts attribute the subdued activity to a complex mix of macroeconomic factors. “Although we’re beginning to see signs that sales may be bottoming out, many buyers remain on the sidelines or are being highly selective,” said Andrew Lis, Director of Economics and Data Analytics at GVR【3】. “They’re watching not just prices, but the broader economic and policy environment.”
Vancouver Real Estate Inventory Levels Reach Highest Point Since 2018
The most notable development in May was a sharp increase in active listings. The number of homes listed for sale on the MLS system reached 17,094, representing a 25.7% increase year-over-year and 45.9% above the 10-year seasonal average【3】. This is the highest level of inventory recorded since 2018.
The surge in listings includes both resale and newly completed homes. Rennie Group Chief Economist Ryan Berlin confirmed that Metro Vancouver is currently seeing an “all-time high” in available inventory, with an estimated 16,000 new or presale units and 24,000 resale homes on the market【1】.
This influx has tilted negotiating power in favour of buyers. Properties are now taking significantly longer to sell, with industry professionals reporting typical listing durations of two to three months, compared to just one to two weeks in earlier years【1】.
Buyer Demand Slows as Lending Constraints Persist
The sales-to-active listings ratio—a key indicator of market balance—stood at 13.4% in May across all property types. Detached homes posted an even lower ratio of 10.2%, suggesting growing downward pressure on prices【3】. Historically, home prices tend to soften when the ratio drops below 12%.
Compounding the slowdown is the continued influence of Canada’s mortgage stress test, which requires buyers to qualify at the greater of 5.25% or their contract rate plus two percentage points【5】. This effectively reduces the purchasing power of many prospective buyers, particularly first-timers and those with limited down payments.
While alternative lending options remain available, they often come with higher interest rates and less favorable terms. This has forced many would-be buyers to delay their entry into the market or lower their price expectations.
Foreign Buyers Tax Rulings Add Regulatory Clarity
Adding further complexity are two recent court decisions regarding British Columbia’s Additional Property Transfer Tax (ATT). In British Columbia v. 1084204 B.C. Ltd., the Court of Appeal ruled that transfer taxes apply to the party receiving legal title, even when acting on behalf of another【4】. In a related case (Chuang v. British Columbia), the BC Supreme Court confirmed that ATT should be calculated based on the full market value of the property, regardless of beneficial ownership structures【4】.
These decisions are expected to impact both foreign buyers and domestic investors using nominee or trust arrangements, adding legal clarity while reinforcing the province’s enforcement stance on real estate taxation.
Political Uncertainty Weighs on Sentiment
With the federal election approaching, uncertainty surrounding future housing policy is contributing to buyer hesitation. According to GVR, political factors are among the top concerns cited by both consumers and developers, alongside the potential for a recession triggered by trade instability with the United States【1】【2】.
Policy areas under scrutiny include possible changes to zoning laws, GST exemptions for rental construction, and federal infrastructure funding. Industry observers note that such reforms, while potentially beneficial long-term, are creating near-term uncertainty that has slowed developer activity and cooled speculative demand.
“Buyers and developers alike are in a holding pattern,” said one Vancouver-based broker. “Until there’s more clarity from Ottawa, a lot of people are just waiting.”
Price Outlook: Gradual Adjustments Likely
Despite cooling conditions, benchmark home prices have remained relatively stable, holding close to $1.2 million across Greater Vancouver for the past three years【2】. Most analysts believe any future price adjustments will be measured rather than sharp.
The GVR forecasts an average price increase of 4% for 2025, though it expects apartment price growth to trail other segments due to higher supply levels【2】. However, much will depend on inventory trends through the second half of the year.
Lis noted that if active listings begin to decline while demand rebounds—especially dropping below the critical 10,000-unit threshold—price acceleration could return rapidly. This pattern has been seen in prior cycles, including the sharp market rebounds of 2016 and 2021【2】.
Conclusion: A Market in Transition
The Greater Vancouver housing market appears to be moving away from its historically volatile boom-and-bust pattern and into a more balanced—though fragile—equilibrium. Elevated supply, tightened lending conditions, and political ambiguity are reshaping the landscape for buyers and sellers alike.
While this transition could foster long-term stability, stakeholders should prepare for continued short-term volatility as new policies, rate decisions, and external shocks ripple through the system.
With affordability still a major issue and major policy shifts on the horizon, all eyes will remain on inventory levels, mortgage trends, and federal decision-making in the months ahead.
<References>
[1] CBC News: Vancouver real estate sees weaker-than-usual spring sales
https://www.cbc.ca/news/canada/british-columbia/vancouver-real-estate-spring-sales-1.7530773
[2] Business in Vancouver: No More Boom and Bust – BC Real Estate Finds Balance
https://www.biv.com/news/no-more-boom-and-bust-bc-real-estate-sees-balance-heading-into-2025-10264275
[3] Greater Vancouver Realtors – May 2025 Market Stats Package (PDF)
https://members.gvrealtors.ca/news/GVR-Stats-Package-May-2025.pdf
[4] Thorsteinssons LLP Tax Blog – BC Foreign Buyers Tax Cases Explained
https://www.thor.ca/blog/2025/05/recent-cases-address-application-of-bc-foreign-buyers-tax/
[5] Seven Lending – Understanding the 2025 Mortgage Stress Test
https://sevenlending.ca/mortgage-stress-test-2025/
[6] Fifth Ave Real Estate – 2025 Election: What’s at Stake for Housing?
https://fifthave.ca/the-2025-canadian-election-whats-at-stake-for-real-estate/