Vancouver’s resale housing market is being challenged by persistent unaffordability, economic uncertainty, cooling sales activity and diverging price expectations.

That’s according to an analysis released Thursday by the Conference Board of Canada, which said the rising number of listings is helping to depress prices in the region.

“Lagging sales and elevated listings strongly suggest sellers will have to lower prices to attract buyers,” said a Jan. 8 report by Conference Board economist Christopher Heschl.

“This is good news for interested buyers waiting for homes that fit their budgets. However, if sellers are unwilling to take a haircut and delay lowering prices, the resale market could soften further.”

A weaker resale market and demographic changes are expected to slow down the construction of new homes, with housing starts anticipated to fall 18% between 2025 and 2030.

But major non-residential projects should keep the construction sector afloat. The report cited major transportation projects like the $3-billion Broadway Subway and the $6-billion Surrey-Langley SkyTrain extension.

Another big project is the Vancouver Fraser Port Authority’s $3.5-billion Roberts Bank Terminal 2 expansion in Delta slated to begin in 2028, the report said.

The Conference Board also analyzed the impact of trade uncertainty on Vancouver. It said the region is relatively insulated compared to other parts of Canada.

“The city’s location on the West Coast gives it easy access to Asian markets, partially shielding it from US trade uncertainty,” said the report.

“However, persistent housing unaffordability, unfavourable demographics and a modest Canadian economy are still weighing on growth prospects.”

This year should see the first population decline in the region’s modern history as federal policies cause a net outflow of international migrants, said the report.

“International migration accounts for most of Vancouver’s population growth, driving more than 80% of all resident gains over 2015 to 2024,” the report said.

“As a result of the federal government’s reduction in international migration targets between 2025 and 2027, the region’s population is set to shrink slightly.”

A stabilizing population is expected to restrain employment growth and result in a tighter labour market, the Conference Board said.

Moderate population growth could return around 2028 if federal immigration targets relax again, the independent research organization said.

Vancouver’s Resale Market Could Soften Further as Price Expectations Diverge by Jami Makan | BIV