The market faced its fair share of drama. From sky-high interest rates to housing supply (or lack thereof) and everything in between here’s a quick rundown of 2024:
Interest rates took center stage.
The first half of the year saw buyers sitting on the sidelines, thanks to relentless interest rate hikes. But then, in June, there was relief with a rate cut. Cue the cautious optimism. It wasn’t until Q4, we started seeing the real magic happen – sales volumes picked up as buyers felt a little braver about jumping back into the market.
Housing supply squeeze.
Metro Vancouver continued to wrestle with housing shortages. Labour shortages and ballooning construction costs turned even the simplest projects into uphill battles. Builders had their hands full, and that left buyers competing for limited options.
Regulations, regulations, regulations.
Policymakers stayed busy in 2024, rolling out a slew of new rules. From tweaks to short-term rental policies to the brand-new BC home-flipping tax, these measures aimed to cool the market – but not without sparking plenty of debate
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The only thing that is ever constant is change. For our industry, 2025 is going to be no exception. Those willing to be authentic, adaptable and agile will survive.
Erin Best
Director of Real Estate & Industry Engagement
Peering into 2025.
The lessons of 2024 are still fresh, and they’ve set the tone for what we expect to see in 2025. But if I’m boiling it down, these are the three things I believe will impact BC real estate in 2025:
Technology and AI.
AI has been a hot topic this year and continues to be a topic of interest. AI can be an incredible tool when it’s used properly. But it can be a terrible experience for consumers when used in the wrong ways. How do I think AI and technology can help our industry in 2025? If you use it to streamline processes, support data-driven decisions, make your content accessible, schedule, or use it for ideation or brainstorming, it can be incredibly helpful. Where AI harms the industry is when it’s used to generate misleading content without any fact checking. And we’ve even seen mainstream media come under fire for using AI to write misleading content. In his latest one-on-one video update, Trevor Koot, CEO of BCREA, says when it comes to technology and AI the industry is also “grappling with issues, such as ethical use, privacy, tech adaptation, client trust as well as cyber-security.” Consumer trust is one of the most valuable currencies in real estate. In my experience? Empathy that creates authentic connection will always win over inauthentic AI messaging. Every time.
Housing supply.
Getting a new project off the ground can be hard enough, but it could be even more challenging in 2025. If you recall in our 2024 article, “This is why we can’t have nice things,” new developments are going to experience challenges being built which limits new supply coming to the market. And when it does come to market, is it the right kind of product that Homeseekers want? According to REW One member Steve Saretsky at Oakwyn Realty in his latest 2025 outlook video about the missing middle housing product, “we haven’t been building product for these young people that are having kids and needing these three- and four-bedroom properties.” He further explains that in Vancouver, it’s “been like either you jump up to the $2.5 million single-family house or you buy a two-bedroom condo for, call it, a million bucks.” There were no “next step” or “up-size” properties being built over the ten or so years, which also puts a huge strain on demand in the market with few options for buyers needing a bit more space. Of course, we are seeing multi-family homes being prioritized due to neighbourhood densification and blanket zoning policies, but how long until those properties are built? And what will the affordability even look like when they come to the market?
Regulatory impact.
Looking ahead to 2025, the provincial government plans to introduce further measures to strengthen enforcement and compliance in a few different ways. The first being, a new provincial short-term rental registry that will require hosts to include a provincial registration number on their listings. This would require platforms to validate these numbers against the registry and remove listings without valid provincial registry numbers. This is ultimately designed to ensure short-term rental hosts are following the rules and improving transparency and compliance.
The second being higher property taxes for non-resident owners with vacant or underused properties and stricter reporting requirements to prevent tax evasion through complex ownership structures. Both of these aim to deter speculative purchases and prioritize housing for residents. The unintended consequence of that is that it could lead to fewer international investments in the luxury and high-end market, potentially impacting new developments. Even more specifically, the city of Vancouver is implementing the vacant home tax to reduce the number of vacant properties in the city.
Lastly, the new BC home flipping tax came into effect 1 January 2025. The tax applies to the profit a person earns from selling a property in British Columbia. This includes pre-sale contracts, if you own the property for less than 730 days (two years). With every good intention, there is usually an unintended consequence. For this tax, the intention is to deter investors from snapping up properties only to inflate the property’s resale value in a short period of time. The consequence of this is it keeps livable properties off the market for longer, which impacts housing supply or deters sellers from listing even though they may qualify for the exemptions to this rule.
The only thing that is ever constant is change. For our industry, 2025 is going to be no exception. Even if the market is predicted to be more balanced, other influences are going to impact the industry and impact how agents operate – always remember to expect the unexpected. Those willing to be authentic, adaptable and agile will survive.
