Metro Vancouver's Unsold Condo Problem Isn't Just About Small Units
More than 5,700 completed condominiums across Metro Vancouver remain unsold, but a closer look at the latest inventory figures suggests the problem may not be what many people assume.
A recent Globe and Mail article examined data from Real Property Data and found that the majority of completed, unsold condominiums in the Lower Mainland are actually larger, family-sized homes rather than the smaller studio and one-bedroom units often associated with investor-driven development.
The findings add another dimension to the growing inventory challenges facing Metro Vancouver's condominium market. They also raise questions about buyer preferences, affordability and whether the type of housing being delivered is necessarily aligned with what purchasers are prepared to buy.
The Unsold Inventory Is Largely Made Up of Larger Units
According to the data reported by the Globe and Mail, there were 5,770 completed but unsold condominiums across the Lower Mainland at the end of the third quarter of 2026.
Of those units:
- 36.8% were studios or one-bedroom condominiums.
- 60.6% had two or more bedrooms.
- Including completed unsold townhouses, approximately 66.3% of the combined inventory was made up of family-sized homes.
The floor-area breakdown tells a similar story. Approximately 64% of the completed unsold condominiums were 700 square feet or larger, while only about one-third were under 700 square feet.
These figures challenge the common perception that the current inventory problem is primarily the result of developers building too many small, investor-oriented apartments.
Why Are Larger Condominiums Sitting Unsold?
Part of the explanation comes down to how new developments are financed and sold.
Developers typically need to presell a certain percentage of a project, often around 60% to 70%, to secure construction financing. During the presale boom, smaller studios and one-bedroom units were often easier to sell, particularly to investors attracted by the potential for price appreciation and future rental income.
Larger units, on the other hand, were frequently held back for sale closer to completion, when developers expected to achieve higher prices.
That strategy has become more challenging in today's market. Investor activity has declined, buyers are more cautious and the demand that once supported rapid presale absorption has weakened. As a result, developers are finding themselves with a greater proportion of larger units remaining when projects are completed.
Affordability is another important consideration. Larger condominiums naturally carry higher overall purchase prices, even when the price per square foot is competitive. For buyers looking for additional space, the price difference between a two-bedroom condominium and a townhouse may also be less significant than it was several years ago.
This creates another layer of competition. Families who might previously have considered a larger condominium may now be weighing the benefits of a townhouse, particularly when additional outdoor space and a more traditional family-oriented layout are available.
The result is not necessarily that these homes are undesirable, but that they are competing for a smaller pool of buyers at price points that have become more difficult to justify.
What Does This Mean for the North Shore?
As we discussed in our earlier article, Metro Vancouver's Unsold Condo Inventory: What It Means for the North Shore, the concentration of completed unsold inventory varies considerably across the region.
Burnaby, Vancouver, Surrey, Coquitlam and Richmond account for some of the largest concentrations of completed unsold homes. The North Shore is not among the areas with the highest volumes of this inventory.
Limited land availability, geographic constraints and a different development profile mean the North Shore has not experienced the same volume of condominium construction as some other Metro Vancouver municipalities.
However, that does not mean local condominium owners are insulated from the broader market conditions.
Newly completed developments can compete directly with resale condominiums, particularly when developers are offering incentives, adjusting prices or providing buyers with opportunities to purchase brand-new homes. Buyers comparing their options may also have more flexibility to negotiate on existing properties.
For resale sellers, this makes pricing, presentation and the overall value proposition increasingly important. Buyers have become more selective, and factors such as building condition, strata finances, anticipated maintenance costs and the overall cost of ownership can all influence purchasing decisions.
For buyers, the current environment offers more choice and potentially greater negotiating flexibility, whether considering a resale property or a newly completed home.
Could Changes to Foreign Buyer Restrictions Provide a Boost?
One potential development worth watching is the federal government's approach to Canada's foreign buyer restrictions, outlined in Budget 2026.
While the budget extends the general restrictions on foreign purchases of residential property until January 1, 2029, it maintains an exemption for newly constructed homes. This allows foreign buyers to purchase newly built residential properties, while restrictions on purchases of existing homes remain in place.
For Metro Vancouver's condominium market, this distinction could be significant. With thousands of completed homes still sitting unsold and developers looking for ways to move standing inventory, access to a broader pool of potential purchasers could provide some additional support.
Foreign investment was an important part of the presale market during the previous development cycle, particularly for smaller condominium units. Reopening access to newly constructed homes could bring some additional interest from international purchasers, although it remains to be seen how much demand will return under current market conditions.
It is unlikely to be a solution on its own. Pricing, affordability, financing costs and buyer confidence will continue to play a much larger role in determining how quickly existing inventory is absorbed. However, allowing foreign purchasers to participate in the new-home market could provide another source of demand at a time when developers are facing considerable pressure to sell completed units.
A Condominium Market Still Finding Its Balance
The growing volume of completed unsold inventory highlights a broader challenge facing Metro Vancouver's housing market. The issue is not simply how many homes are being built, but whether the type, size and price of those homes align with what buyers are looking for and can afford.
There is also a wider development-policy consideration. Municipal requirements for family-sized units, construction costs and the economics of building larger homes all influence the type of projects developers bring to market. While increasing the supply of larger homes is an important housing objective, those homes also need to be financially attainable for the households they are intended to serve.
The current inventory is a reminder that housing supply and housing demand do not always line up as expected. Smaller investor-oriented units may have accounted for a significant portion of past presale activity, but it is now the larger homes that make up the majority of the completed unsold condominium inventory.
For the North Shore, the regional numbers provide useful context, but local market conditions and the characteristics of individual properties remain important. As the condominium market continues to adjust, buyers and sellers alike will need to pay close attention to the competition and the value being offered.
How Does This Affect You?
Whether you are considering purchasing a condominium, selling an existing property or exploring a newly completed development, understanding the broader market is only part of the picture.
If you would like to discuss current condominium market conditions or how they may affect your property or plans, contact our team of North Shore market experts. We are happy to provide a local perspective and help you understand your options.