The pandemic drove Greater Vancouver new home sales off a cliff, but things have improved… a little. MLA Canada, a Vancouver-based real estate firm specializing in condo pre-sales, observed an increase in absorption for June. Despite unusual market conditions and a bump from lows, absorption is the same rate as last year. Although the current rate is likely being managed through inventory, and project delays.

Greater Vancouver Condo Pre-Sales Down 50%, But Off Pandemic Lows

Greater Vancouver condo pre-sales bounced from record lows, but still came short. There were just 36 units sold in June, up 51% from the month before. The number is a massive 50% lower than the same month last year. A bit of a surprise considering last year was one of the slowest Junes on record. This persistent slowdown is turning into a throttle for new project launches.

Greater Vancouver New Pre-Sale Real Estate Listings

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

*MLA Canada number not available.
Source: MLA Canada, Better Dwelling.

Over 57% Of Pre-Sale Homes Expected Are Delayed

The extended slowdown in sales is leading to a lot less inventory than expected. Greater Vancouver saw 259 new pre-sales hit the market in June, up 8% from the month before. This works out to a drop of 50%, compared to the same month last year. It’s inline with the decline in sales, but it’s also 57% lower than the anticipated units for the month. That’s about 338 units delayed, that may pop up later, or be cancelled  – depending on future absorption.

Units are being absorbed at an incredibly low rate, but similar to last year. The sales to new listings ratio (SNLR) reached 14% in June, the same ratio as last year. Analysts generally believe prices will rise when the SNLR is above 60%, fall below 40%, and are priced correctly between those two.

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.

Greater Vancouver condo pre-sale absorption is unchanged from last year, but with a few caveats. Sales are significantly lower this time around, and so is inventory. Even more inventory has been delayed and throttled to get to this level. The market may actually be softer than absorption implies. Whether that matters depends on if developers can effectively control inventory longer than buyers wait.

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