New Condo Sales In Vancouver Drop, But Buyer Incentives and Realtor Bonuses Rise

Greater Vancouver condo presale buyers still aren’t interested, even with more incentives. Numbers from MLA Canada, a real estate analytics and marketing firm, show Greater Vancouver condo presales fell in March. An accompanying decline in inventory helped to offset the drop in sales. However, it wasn’t quite enough to change the current trend.

Sales of New Greater Vancouver Condo Presales Are Falling

New condo presale releases sold in the same month are falling. March saw an estimated 227 new pre-sales sold, up 31.97% from the month before. The total represents a 75.92% decline compared to the same month last year. For context, last year we saw the monthly number decline, so this is bucking the trend. MLA attributed the monthly increase to rising Realtor bonuses, as well as buyer incentives. Even so, the annual number was such a large drop, the monthly rise was just a blip.

Fewer Condo Presales Hit The Greater Vancouver Market

The total number of condo presale releases fell last month. There were an estimated 811 units released to market in March, down 29% from the month before. Inventory of these units are also down 48.4%, when compared to the same month last year. The monthly decline is typical, with February usually logging bigger sales than March. The annual decline is not typical.

Greater Vancouver New Pre-Sale Real Estate Listings

The number of newly available pre-sale units of new homes across Greater Vancouver.

*MLA estimate.
Source: MLA Canada, Better Dwelling.

Lower Prices Or Greater Incentives Might Be Coming

Same month absorption of new units puts the market in buyer’s territory. The sales-to-new listings ratio (SNLR) reached 28% in March, down 53% from last year. This is the highest the SNLR has been since December 2018. Generally speaking, it’s a seller’s market when the ratio is above 60% – meaning higher prices are expected. Below 40% is considered a buyer’s market – where lower prices or more incentives are common. Between 40% and 60% is a balanced market – where it is priced just right. Currently Greater Vancouver condo presales are in a buyer’s market by this measure.

Greater Vancouver New Home Pre-Sale Absorption

The ratio of sales to new listings of pre-sale homes across Greater Vancouver.

*MLA Canada number not available, Better Dwelling estimate based on inference data obtained from MLA.
Source: MLA Canada, Better Dwelling.

Weakness from Greater Vancouver’s condo resale market has extended to pre-construction. Developers are releasing fewer units, but same month sales are dropping much faster. Absorption has firmed up from February’s multi-year low. That doesn’t quite appear enough to change the direction of the market.

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  • Reply
    Snarky 2 years ago

    I’ve also noticed buyer incentives here in GTA rise and emerging lower price points from builders. That could be due to the supposed upcoming government incentives or it could be that they are trying to get the cash flowing again anyway possible. I think they have caught on to the problem and are actively fixing meanwhile home owners with blinders on putting home up for sale at peak pricing. With gas prices in Vancouver being at an all time high and home prices on the down it’s easy to see why Vancouverites are not keen to buy, buy, buy. That era is gone.

  • Reply
    RainCityRyan 2 years ago

    What? Say it ain’t so Snarky! With incentives like free-avocado toast I’m gonna buck the trend and rush out to catch the falling knife!!! /s

    But on a serious note, the feeling in the city has totally changed. Much higher stress levels in the average person.

    • Reply
      Joseph 2 years ago

      LMAO!!! Priceless! The kicker? What if they stop giving you the year’s supply of avocado toast? Honestly, what’s stopping them? If an incentive is spread over a year instead of upfront what guarantee is there that the buyer will keep getting it?

      Mind you, avocado toast. Yikes!

      On a side note, optimism here in Ottawa. Seems that lineups are a thing now. For the better builders. It seems like builders have purposely stopped building. I’ve seen this all before when I lived in southern ontario. Then again, maybe it was an undervalued market? Only time will tell.

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