BC Housing Market Risks Repeating the 2010s BCREA Economics Report Urges Immediate Government Policy Action

The latest economic report from the BC Real Estate Association (BCREA) indicates that immediate government action is required to encourage housing starts and avoid rapid home price increases toward the end of this decade.

According to a new BCREA Market Intelligence report, today’s housing market shows signs similar to the 2010s housing cycle, which ultimately led to severe undersupply and a dramatic deterioration in affordability. 

 

Summary of Findings

• BC risks repeating the post‑Global Financial Crisis housing cycle, where weak demand boosted inventories and slowed construction – only to leave the province severely undersupplied when demand rebounded, triggering rapid price escalation and worsening affordability.

   

• Unsold new inventory has surged to a 30‑year high, especially concentrated in the apartment segment, and developers are delaying or cancelling projects because weak pre‑sales make financing nearly impossible. This dynamic threatens a future supply crunch.

   

• BCREA model simulations show a significant upside risk to prices, with home prices potentially rising up to 27 per cent (inflation-adjusted) by 2032 as current construction shortfalls collide with recovering demand later in the decade.

   

• Policy action on both demand and supply sides is needed now, including measures to strengthen pre‑sales, reconsider foreign‑buyer participation in new construction, and reduce development costs. Without this, BC is likely to enter another prolonged affordability crisis.

“Unsold inventory of new homes is rising to levels not seen since the late 1990s, which, along with crippling taxes, is discouraging future development,” says BCREA Chief Economist Brendon Ogmundson. “This puts BC at risk of chronic undersupply when demand inevitably returns and a repeat of the 2010s cycle of accelerating home prices.”

 

The report concludes that expanding supply remains the most important ingredient to both sustainable development and moderated price growth over the foreseeable future, while also noting that there is substantial benefit to reducing the existing excess of unsold new inventory as quickly as possible.