Metro Vancouver’s residential market in 2024 proved to be a mixed bag, falling short of optimistic forecasts set earlier in the year by Greater Vancouver Realtors (GVR). While some gains were seen, they didn’t reach expectations, leaving some market watchers reassessing their expectations for 2025.

Missed sales targets

GVR released its H1 forecast for 2025, including a look at how 2024’s market compared to its forecast. At the start of last year, optimism was high. GVR predicted an 8 per cent increase in sales compared to 2023, with projections reaching 28,250 transactions by year-end. Ultimately the market closed the year with 26,561 sales, a 2 per cent rise over the previous year. The momentum, initially driven by reduced borrowing costs, faltered in the summer, curtailing overall performance.

Price gains under pressure

Similarly, price growth failed to reach expectations. The average residential price was forecasted to rise by 3 per cent in 2024, reaching  $1,320,000. Instead, the actual increase was half that—1.5 per cent, with the year-end average price settling at $1.3-million. Early gains in the year were eroded by growing inventory levels and weaker-than-expected sales.

“Despite numerous cuts to the Bank of Canada’s policy rate and subsequent reductions to borrowing costs throughout 2024, supply continued to outpace demand by year-end, eroding, but not fully erasing, the price gains which began the year,” the report notes.

Looking ahead to 2025

With 2024’s shortfalls as a backdrop, GVR’s forecast for 2025 maintains cautious optimism. Key drivers such as population growth, household formation and lower borrowing costs are expected to support the market. Political and economic uncertainties—including potential U.S. trade policies pose a risk to the housing market

Risks and wildcards

GVR’s modeling suggests that based on “preliminary analysis” proposed U.S. tariffs on Canadian goods, if implemented, could create a drag on sales activity. The impact is expected to be short-lived, and “any negative impacts to home prices are likely to be modest and would most likely arise through the (potential) reduction in sales activity, rather than through any direct impacts arising from the tariffs themselves.”

Canada’s inevitable federal election could also derail GVR’s outlook for the region. “Political turmoil at the Canadian federal level along with the potential for a new Conservative government could yield policies negatively impacting the housing market, though new policies could also positively impact the market as well.”

Outlook for 2025

GVR economists see improved momentum heading into 2025 compared to last year, with lower borrowing costs anticipated to support demand.

“Our price forecasts for 2025 are again similar to those we expected in 2024, however the market now has the benefit of significantly lower borrowing costs to start the year than were available in 2024, which we believe should provide the necessary stimulus to reach our 2025 price forecasts.”

Residential sales are expected to reach 30,250—a 13.9 per cent increase over 2024, while the average home price is projected to grow 4.1 per cent—reaching $1,354,000. 

As with most forecast’s, GVR’s outlook for the year comes with a key caveat: a stronger-than-expected economic recovery could accelerate sales and price growth, while heightened inventory levels or recessionary pressures could dampen performance.