BC’s housing market lost momentum in September as August’s pickup proved short-lived. According to the latest Canadian Real Estate Association estimates, seasonally adjusted MLS sales fell 5.7% from August to 5,428 units. Sales were also down 7.7% year-over-year and 5.9% year-to-date. The decline came amid renewed uncertainty stemming from escalating Canada-US trade tensions, expectations of further Bank of Canada rate hikes and higher mortgage rates.

Sales performance varied across real estate board areas, although Lower Mainland and Island markets were generally weaker. Sales in Greater Vancouver and the Fraser Valley declined 6.2% and 2.9% month-over-month, respectively. Victoria recorded a sharp 24.5% decline, while sales on Vancouver Island, excluding Victoria, fell 10%. Kamloops and the Kootenay recorded declines of 6.5% and 5%, respectively, while sales were unchanged in Chilliwack. In contrast, Okanagan markets rebounded after pronounced declines the previous month.

New listings also receded as demand softened, falling 2.9% during the month. Market conditions shifted further into buyers’ territory, with the sales-to-new-listings ratio declining from 45.2% to 43.9%.

The provincial average home price fell 1.2% to $941,171 and was 2.4% lower than a year earlier. Average prices can be influenced by geographic and compositional shifts in sales. The composite benchmark price declined 0.1% month-over-month and 4.7% year-over-year, indicating continued downward pressure. Average and composite benchmark prices are now 12.7% and 15% below their respective peaks in early 2022.

Regionally, average prices declined sharply in the South Okanagan (14.3%), Kamloops (8%) and the Kootenay (5.8%), while Greater Vancouver recorded a modest 0.1% decrease. In contrast, prices increased on Vancouver Island (5.5%), in Okanagan Mainline (1.8%) and in the Fraser Valley (1.4%).

We expect housing market weakness to persist through late 2026 and into 2027 as subdued economic conditions weigh on buyer confidence and activity. Higher mortgage rates and further monetary tightening will add to affordability pressures and constrain demand, particularly in BC’s more expensive markets.

Housing construction in BC maintained its momentum in September, with Canada Mortgage and Housing Corp. (CMHC) data showing a further increase in housing starts. Urban starts rose 16.6% to a seasonally adjusted annualized rate of 51,120 units, following a 31.9% increase in August. The monthly gain was driven by an 18.2% rise in multifamily starts, while single-family starts edged down 1.3%.

Despite the recent gains, the increase does not indicate broader strength in the construction cycle. Housing starts can fluctuate considerably from month to month, while the six-month moving average remains subdued. Year-to-date, urban starts were down 1.9%, reflecting declines in both multifamily (1.1%) and single-family (9.2%) construction.

Within the multifamily segment, the year-to-date decline was driven by a 5% decrease in apartment starts, which continue to account for the majority of new housing construction in the province. In contrast, semi-detached and row housing starts increased 32.9% and 12.1%, respectively.

Across BC’s major urban markets, year-to-date starts declined sharply in Abbotsford-Mission (49.4%), Kelowna (32.5%) and Victoria (21.2%), while Vancouver recorded a more modest 2.9% decline. In contrast, starts increased 37.1% in Chilliwack and 68.1% in Nanaimo, while activity in Kamloops more than tripled from the same period last year.

BC Home Sales Slide as Housing Starts Rise in September by Bryan Yu | Chief Economist | Central 1 | BIV