British Columbia’s Q3 2024 real estate market saw slight shifts across sectors, with residential sales cooling, rental rates fluctuating, and the office and industrial markets adjusting to increased vacancy and leasing trends.
Residential Summary for Q3 2024
Sales
According to an Edge Realty Analytics report, BC’s sales dropped by 0.2% from Q2 to Q3 2024 and by 1.8% year-over-year, signalling a minor cooling of buyer demand.
Listings
A rise in inventory was experienced, with a 4.0% quarter-over-quarter increase in active listings and a 28.0% annual increase. This was further supported by new listings, which increased by 2.3% from Q2 2024 and 6.6% year-over-year.
Prices
Home prices in BC were unchanged quarter-over-quarter, although they showed a 2.8% decline from Q3 2023.
Months of Inventory
Months of inventory rose to 6.1 months in Q3 from 5.7 in Q2 2024; this shows how long it would take to deplete current listings given the current rate of sales.
Sales-to-New Listings Ratio
The sales-to-new listings ratio moved from 45.3% in Q2 to 44.2% in Q3, indicating a marginally more balanced market as listing activity has outpaced sales.
Construction
New construction activity remained consistent, with properties under construction down by 1.0% from Q2 but up 10.5% year-over-year. This steady pace highlights sustained interest in property development despite shifting demand.
Economic Indicators
Population Growth
British Columbia’s population grew by 0.6% quarter-over-quarter and 3.0% year-over-year, continuing to support demand for housing.
Unemployment Rate
The unemployment rate rose from 5.2% in Q2 2024 to 6.0% in Q3; this still remains lower than the national average. As of October, the overall unemployment rate for Canada was 6.5%.
Mortgage Arrears
Mortgage arrears remained stable at 0.16%, indicating resilience among homeowners even amid a gradually softening market.
Rental Market Update for October
According to Rentals.ca, in Vancouver, the rental market saw declining prices, with one-bedroom units averaging $2,649, a 2.2% monthly decrease and an 11.0% annual drop. Two-bedroom units declined 4.0% from September and 10.7% year-over-year, with average rents at $3,488.
Burnaby’s rental prices experienced a mild reduction. One-bedroom units averaged $2,493, down 0.3% month-over-month and 7.7% year-over-year. Two-bedroom units saw a 1.8% monthly decrease and a 10.5% annual decrease, bringing the average to $3,052.
Victoria, on the other hand, showed slight increases in one-bedroom rents at $2,174, up 0.1% from the previous month and 2.5% year-over-year. Two-bedroom rents, however, showed mixed trends, as they rose 0.5% month-over-month but fell 1.8% annually, to the current October average of $2,854.
Office Real Estate Summary Q3 2024
Vancouver’s downtown office market recorded an increase in vacancy, up by 100 basis points to 11.8%, reversing previous quarterly declines, due to new sublease vacancies, according to the CBRE. The suburban office market followed suit, rising 160 basis points to 10.0%.
Construction activity remains almost entirely in suburban markets, with 763,000 square feet underway, expected to be delivered by the end of 2025; only 35.8% of this space is pre-leased. The only downtown project, 837 Beatty Street, a 30,000 ft2 timber building, is also expected by the end of 2025.
Vancouver Industrial Summary Q3 2024
Vancouver’s industrial sector faced its second consecutive quarter of negative net absorption in Q3, recording -372,800 square feet, bringing the annual total to 509,025 square feet. This represents the first instance of back-to-back quarterly negative absorption since 2011, with overall vacancy up 30 bps from Q2 to 2.8%, the highest level in Metro Vancouver since 2015. Sublease availability increased, comprising 22.2% of all vacancies, up from 20.5% in Q2 and above the five-year average. Lease rates trended down, now averaging $20.28 per square foot, a 4.3% decline quarter-over-quarter and 7.0% year-over-year.