Luxury real estate in Vancouver has long been a coveted asset for both local and international investors. But as we step into 2025, many are questioning whether the city’s high-end market remains a solid investment. With changing regulations, fluctuating interest rates, and evolving buyer demographics, is Vancouver's luxury market still worth it?
In recent years, Vancouver’s luxury real estate market has shown resilience despite global economic uncertainties. According to the Real Estate Board of Greater Vancouver, high-end properties in sought-after neighborhoods such as West Vancouver, North Vancouver, and downtown Vancouver continue to command premium prices. In 2024, sales of homes over $3 million increased by 14% year-over-year, while ultra-luxury properties above $10 million saw a 9% rise in transactions.
Compared to other global cities like New York, London, and Hong Kong, Vancouver remains an attractive option due to its high livability, scenic surroundings, and stable economic environment. However, recent policies like Canada’s Foreign Buyer Ban (CBC) and the Speculation and Vacancy Tax (BC Government) have shifted investment dynamics.
In addition, Vancouver’s luxury rental market has surged. The average rental price for a luxury condo in downtown Vancouver increased by 12% in 2024, with penthouses in Coal Harbour renting for $15,000 - $25,000 per month. High demand and limited inventory have made luxury rentals a lucrative opportunity for investors looking for short-term returns.
Canada extended its foreign buyer ban through 2027, preventing non-residents from purchasing homes. Despite this, foreign capital continues to enter the market through proxy buyers, corporate purchases, and commercial real estate investments. In 2023, over 12% of luxury properties were purchased through trusts or corporate entities, which are not subject to the ban.
Additionally, some foreign buyers are shifting their focus to pre-construction investments, where ownership can be transferred before completion. With demand from international investors remaining strong, many are finding legal workarounds to maintain their foothold in Vancouver’s luxury market. Learn more in our article: How Foreign Buyers Use Loopholes to Purchase BC Homes Despite the Ban.
After several rate hikes in 2023 and 2024, the Bank of Canada has signaled possible cuts in 2025 (Financial Post). The current overnight lending rate is 5%, making financing luxury purchases expensive. If rates drop by 1-2%, it could increase demand and cause a slight uptick in prices.
Lower interest rates have historically triggered luxury market booms. In 2021, when the Bank of Canada held rates at 0.25%, Vancouver saw a 35% surge in luxury home transactions. If rates decline in 2025, we could witness a similar trend, particularly in the $4 million to $8 million price range, where buyers are most sensitive to financing costs. Read: Will Interest Rates Affect Vancouver’s Luxury Market?
Despite high prices, the supply of luxury homes remains tight. Vancouver sees an average of 1,200 high-end property transactions annually, but the inventory of luxury homes has declined by 8% in the past two years. Limited waterfront properties, mountain-view estates, and exclusive gated communities keep demand strong.
In areas like West Vancouver’s British Properties, inventory has shrunk by 12% year-over-year, pushing prices higher. Conversely, luxury pre-sales in Coal Harbour and Yaletown have surged, with developers reporting 80% pre-sales sold within three months. The most in-demand luxury homes are those priced between $4 million and $8 million, making up 60% of luxury sales.
Vancouver’s real estate market has long been tied to foreign capital and money laundering concerns. The Cullen Commission’s findings in 2023 revealed that between $46 billion and $113 billion in illicit money was funneled through BC real estate annually (Global News).
New regulations, including enhanced beneficial ownership reporting, aim to reduce these issues, but some loopholes remain. For instance, luxury properties purchased under corporate structures can obscure ownership details, making it difficult to track the true buyers. However, increased scrutiny from financial institutions and regulatory agencies may deter illicit investment practices. Has the crackdown been effective? Read: How Dirty Money Flows Through BC’s Real Estate Market.
A $5 million budget gets you vastly different properties depending on the location. See our detailed comparison: What $5 Million Gets You in West Van vs. North Van vs. Port Moody.
If you’re looking for stability, Vancouver’s luxury real estate still holds long-term value. The luxury market has outperformed the overall housing market, with high-end properties appreciating by 6.5% annually on average over the past decade. However, investors must navigate foreign buyer restrictions, taxation policies, and shifting demand patterns.