Housing market activity in the Lower Mainland slowed at the start the year as U.S. tariff threats raised economic uncertainty, dampening buyer confidence. Uncertainty overshadowed demand drivers like declining interest rates, higher price caps for mortgage insurance eligibility and the availability of 30-year amortization for all first-time buyers.
Total MLS sales in the region—which spans Metro Vancouver, Abbotsford-Mission and the Sea-to-Sky area—came in at 2,330 units. This was up 0.3 per cent year over year from January 2024 and far below the 27-per-cent increase registered in December. Sales were down about 15 per cent compared to the 10-year January average. The upward trend in momentum has turned over and we calculate a seasonally adjusted decline of about four per cent month to month.
Softer January sales coincided with rising existing home supply, as new listings surged 50 per cent year to year. Active listings also jumped 40 per cent to reach their highest level since 2019. Some of this likely came from completed but unsold units in new developments. The sales-to-active-listings ratio slumped to 13 per cent, pointing to a potential buyers’ market. While a single month does not a trend make, there is excess supply in the apartment market given a dearth in investment demand. The federal U-turn in temporary residents, along with measures to limit apartment flipping and short-term rentals, have contributed to market weakness.
The region’s average home price fell sharply by five per cent in January to a still-lofty $1.14 million. This was partly due to geography and product composition, but was nonetheless a significant pullback and the largest single-month drop since May 2022. The MLS housing price index was unchanged during the month but declined on a seasonally adjusted basis, with apartment and townhome prices in decline.
Manufacturing sales in B.C. inched up 0.3 per cent to $5.6 billion in December, following a 0.5-per-cent gain the prior month. Durable goods industries contributed to the monthly decline, with sales in the industry down by 0.1 per cent. Non-durable goods sales rose by 1.3 per cent.
The durable goods decrease reflected lower sales in transportation equipment (down 6.8 per cent) and fabricated metal products (down 2.6 per cent). Countering these declines was an increase in primary metal sales, which grew by 2.1 per cent. Data for most subsectors in the non-durable goods category is suppressed for confidentiality reasons, but food manufacturing sales increased by 1.3 per cent after a 1.5-per-cent gain in November.
In Metro Vancouver, overall manufacturing sales declined by 3.3 per cent in December, with durable goods sales falling by 1.7 per cent and non-durable goods sales down by 4.7 per cent.
On a full-year basis, B.C. unadjusted manufacturing sales declined 1.5 per cent in 2024 compared to 2023, as sales were tepid in the first half of the year before trending higher in later months. Durable goods sales fell by 1.9 per cent during the year due to decreased fabricated metal sales (down 11.1 per cent) and computer and electronic product sales (down 21.2 per cent). Wood product sales, the largest component in the category, also fell by 0.3 per cent. Weak economic conditions and reduced construction and housing market activity impacted demand for forestry products in 2024. Non-durable goods sales decreased by 1.1 per cent.
B.C.’s manufacturing sector and Canadian manufacturing generally face uncertainty due to the potential imposition of tariffs on Canadian exports to the U.S. B.C. goods exports could face tariffs of up to 25 per cent in March, although the size of tariffs remains unknown, and it is possible they may not materialize. Hardest hit would be sectors such as forestry which already face duties on lumber. That said, B.C. exporters are in a better position than most other provinces given its greater share of international sales to the Asia Pacific.
Bryan Yu is chief economist at Central 1.
