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The Vancouver Rental Bubble Is Real—and It’s Already Bursting

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Welcome to the Great Emptying

For years, the story of Vancouver’s rental crisis went like this: too many people, not enough homes. Landlords raised rents every year. Tenants clung to leases like lifeboats. International students, digital nomads, and short-term migrants flooded into the city, fighting for bedrooms, dens, and converted closets.

By 2023, it wasn’t uncommon to see eight tenants sharing a three-bedroom East Van home. Or renters subletting single bunks for $900/month to students on study permits who were too desperate—or too unaware—to say no.

The whole thing was wildly unsustainable. But it worked. Until it didn’t.

Because in 2025, the rental market didn’t just slow down. It imploded. The engine that kept it running—international students—sputtered and died, almost overnight. And suddenly? All the greed, speculation, and rent hoarding that defined the last five years came back to bite. Hard.

Today, there are empty rooms across Vancouver. Entire Craigslist pages filled with “urgent” sublet listings. Student-only basement units collecting dust. And landlords panicking as their $2,600 mortgage helpers vanish into thin air.

“It’s eerie,” says Jordan L., a property manager in Kitsilano. “Two years ago, we had 50 people lining up for a showing. Now, we have units sitting empty for 90 days, fully furnished, priced $300 below last year.”

Welcome to the Vancouver Rental Bubble Collapse. Where prices are still high, supply is suddenly plentiful, and demand has cratered—because the entire system was built on short-term renters who never planned to stay.

How We Got Here: COVID, Subletting Greed, and the International Student Gold Rush

To understand the rental collapse of 2025, you need to rewind to the chaos of 2020—the start of COVID-19—and the unholy cocktail of policy, panic, and profit that followed.

At the beginning of the pandemic, the rental market in Vancouver briefly looked like it might correct. People fled dense buildings, borders slammed shut, and short-term rental listings flooded the long-term market as tourism evaporated. It was a moment of fragile relief—rents dipped for the first time in years.

But the crash never came. Why?

Because by 2021, massive immigration targets were announced, campuses reopened, and the international student pipeline came back harder than ever. Canada welcomed over 800,000 international students in 2022—more than any other country on earth. B.C. got a huge slice of that, with thousands funneled into private diploma mills operating out of strip malls and shared buildings in Burnaby, Surrey, and East Van.

And guess what most of those students needed? A place to sleep.

Landlords saw dollar signs. So did renters with leases and an entrepreneurial streak. Suddenly, Vancouver had a wild west subletting economy on top of an already broken rental market.

The Rise of the “Tenant-Landlord” Middleman

It started small: someone with a 2-bed condo rents the second room to a student for $1,300/month, covers their share of the rent, and pockets the difference.

Then it grew: people leased whole homes and sublet each room separately at a markup. Or split living rooms into curtained “bedrooms.” Or rented units under corporate names and filled them with a revolving cast of short-term renters at inflated prices.

By 2023, it had become commonplace:

  • A three-bedroom East Van house rented for $4,200/month. The primary tenant sublet it to seven students at $950 each—pocketing $2,450 in profit.

  • A West End 1-bedroom was converted into a three-person unit: the bedroom went for $1,500, the living room for $1,300, and the den for $1,000. Total income: $3,800. Original rent? $2,300.

  • “Study bunk” listings appeared on Facebook Marketplace: one twin bed in a shared room for $850–$1,000/month, often with six tenants to a 2-bed.

These setups were rarely legal. Almost never safe. But completely normalized. Everyone was in on it:

  • Landlords looked the other way—or turned entire suites over to tenants-turned-managers who paid inflated “rent” in exchange for full control of subletting.

  • Realtors whispered advice about how to maximize rental yields through partitioning and international student targeting.

  • Tenants played middleman, acting as gatekeepers to the “underground rental economy” and charging top dollar for low-quality space.

And the city? Mostly ignored it.

The City’s Role: Neglect, Denial, and Over-Zoning for Investors

Vancouver’s zoning policies were never built for affordability. They were built for value maximization.

The vast majority of new construction since 2016 was aimed at luxury condos and investor suites, not purpose-built rental. Developers were incentivized to build pre-sales and market homes. The “missing middle” was endlessly studied, seldom delivered. And actual enforcement of illegal rentals or overcrowding? Almost nonexistent.

During COVID, the city took a “don’t rock the boat” approach. Enforcement of occupancy bylaws was quietly deprioritized. Short-term rental crackdowns were symbolic. And even when inspectors did show up, very few landlords or tenants faced penalties—partly because no one wanted to evict a house full of students during a pandemic.

This non-response sent a clear message:

Maximize your income however you want. No one’s watching.

By 2023, the student-fueled rental economy was booming. So was rent inflation. Asking rents for 1-bed units hit an average of $2,780/month, and 2-bedrooms cracked $3,800, according to Rentals.ca. Meanwhile, the vacancy rate in Metro Vancouver hit 0.9%—a near-record low, per CMHC data.

It was brutal, but it worked—as long as the students kept coming.

2025: The Demand Engine Shuts Off

Then came the rug pull. In early 2024, the federal government—under mounting pressure to fix housing—announced a massive cap on international student permits, slashing numbers by over 50%. The crackdown focused heavily on private colleges, the same institutions responsible for the fastest-growing student populations in B.C. The move was so abrupt that many schools shut down within months.

The result?

  • Tens of thousands of students never arrived.

  • Others lost status mid-program.

  • Thousands more left Canada quietly—disillusioned by high costs, lack of support, and broken promises.

By Q1 of 2025, Vancouver had lost tens of thousands of renters in under a year.

And just like that?

  • Sublet rooms sat empty.

  • Basement suites went unrented.

  • Landlords panicked.

  • And tenants-turned-subletters? Many were left holding leases they could no longer monetize.

“I was making $1,200/month profit off a 3-bed in Burnaby,” one anonymous subletter told us. “Now I’m on the hook for the whole lease. My roommates left in January and I haven’t had a single response in weeks.”

That story is repeating across the region. Vancouver built a rental economy on transient, precarious demand. And when it disappeared? The bubble popped.

From Cash Flow to Negative Carry: Why Vancouver’s Landlords Are Now Losing Money

For over a decade, Vancouver landlords operated like they couldn’t lose. Buy a property. Rent it out. Let someone else pay your mortgage. Maybe refinance in a few years. Rinse. Repeat. If you played the game right—and found just the right group of students, temporary workers, or co-living strangers—you could easily clear $1,000+ in monthly profit.

But in 2025, those same landlords are now experiencing something they haven’t faced in a long time: Negative carry.

It means what it sounds like. The income doesn’t cover the expenses. The math no longer works. And suddenly, the once “passive” investor class is burning thousands a month—because the market they fed off for years is turning on them.

The Numbers Don’t Add Up Anymore

Let’s do the math.

Say you bought a Vancouver duplex in 2021 for $1.75 million—not uncommon in East Van. You put 20% down ($350K) and financed the rest with a 5-year variable mortgage at 1.65%. Your monthly payment back then? About $4,900/month.

Fast forward to 2025:

  • That mortgage has renewed. Your new rate is 5.79%.

  • Monthly payment? $8,200/month.

  • Property tax: $7,500/year.

  • Insurance and maintenance: $4,000/year minimum.

Let’s say you live in the top unit and rent out the basement suite. Pre-2024, you were easily getting $2,800–$3,000/month from international students or short-term tenants. But now? You’re struggling to find anyone willing to pay more than $2,200—and that’s if they actually show up to the viewing.

Even if you do rent it, you’re now subsidizing the property by $6,000–$7,000 per month—on top of living in a city with some of the highest costs of living in North America.

And if you own multiple properties? Multiply the pain.

“We used to cash flow $1,500/month on our 2-bed laneway in Kits,” says owner Ashok G., who bought in 2017. “Now we’re covering $800/month out of pocket. We’d sell, but nothing’s moving.”

That’s the new reality: Vancouver’s rental market no longer works for landlords—especially those who treated their properties like ATMs instead of homes.

The Subletting Game Collapses First

The earliest signs of stress came from the rental middlemen—those who leased large units and sublet them room-by-room to generate “passive income.” Most weren’t even homeowners. They were tenants running small, unregulated rental businesses.

In early 2023, these “operators” were thriving. By fall of 2024, many were in serious trouble. And now, in spring 2025, they’re the first to be completely wiped out.

“I know six people who signed 12-month leases on 4-bed homes, thinking they’d make a killing,” said Kevin, a former Airbnb and sublet manager. “By February, they were begging people to move in. Now they’re in default. Some just ghosted their landlords.”

The disappearance of international students was the first domino. But what followed was a wave of panic subletting—Facebook groups flooded with desperate listings, often offering rooms at steep discounts or with “first month free” offers. Some renters even started paying people to take over their leases.

At the peak in February 2025, a search for “room available” on Vancouver Facebook housing groups returned over 1,700 active listings, with many reposted daily.

The glut overwhelmed demand. Prices cracked. And once the subletting pyramid scheme collapsed? The pain moved upstream—right to the actual landlords.

Even Purpose-Built Rentals Are Sitting

It’s not just secondary suites and investor condos. Newly built rental buildings—the ones politicians love to point to in photo ops—are now experiencing lease-up problems for the first time in years.

A 2024 purpose-built building in Burnaby, targeting “young professionals,” launched in late fall with:

  • $2,400/month 1-bed units

  • $3,600/month 2-bed units

  • Limited amenities

  • Mid-tier finishes

By April 2025, only 60% of units were leased. Several tenants who moved in during pre-lease promotions now pay less than current asking rents, leading to tenant resentment and turnover.

Meanwhile, operators are quietly offering incentives:

  • One month free

  • Visa gift cards

  • Gym memberships

  • “Live free until June” promos

These are pre-crash tactics—the kind of tricks landlords use when they know the optics are bad but still don’t want to admit that rents are dropping.

They’re trying to preserve pricing on paper. But the market doesn’t care about paper. It cares about vacancy. And 2025’s vacancy rate? It’s finally climbing.

Landlords Can’t Sell—And They Can’t Hold

So what happens now? Many landlords would love to sell. But the resale market is frozen. As explored in Why Nothing Sells in Vancouver Anymore, buyers have disappeared, listings are stacking up, and prices are quietly correcting—especially for properties that no longer cash flow.

That means landlords are now:

  • Trapped in high-cost assets

  • Losing money every month

  • Unable to exit without taking a loss

  • Unwilling to drop rents (because they’re in denial)

  • Stuck hoping for some miracle in Q3 or Q4

It’s a classic asset trap. And for many, it’s the first time they’ve ever felt real risk.

The Renter Rebellion: What Happens When Tenants Finally Have Leverage

For over a decade, Vancouver’s rental market has been a one-sided blood sport. Landlords raised rents at will. Tenants signed over their privacy, dignity, and peace of mind just to secure a shoebox. Asking if pets were allowed felt like a privilege. Submitting an application required full financial disclosure, professional references, and a handwritten essay on why you’re “low impact.”

But in 2025? The power balance is shifting—fast.

With inventory rising and applicants thinning out, tenants are finally gaining leverage. They’re asking tougher questions. They’re pushing back. They’re offering less. And for the first time in years, landlords are listening.

No More Begging—Now It’s Bargaining

Just six months ago, a listing for a one-bedroom in Mount Pleasant at $2,600/month would have sparked a bidding war. Now?

  • Renters are negotiating down to $2,200.

  • Asking for free parking or utilities included.

  • Demanding repairs and upgrades before move-in.

  • Refusing 12-month leases unless there’s a rent freeze.

  • Ghosting landlords who don’t answer within 24 hours.

“I applied for a 2-bed in Kits at $3,000,” says Gemma, a 34-year-old renter who moved from Toronto. “Then I found the same floorplan in the same building for $2,700. I messaged both landlords and said, ‘I’ll take whichever one drops to $2,500 first.’ One replied in 10 minutes. That never would’ve happened last year.”

This is the post-bubble shift. Renters know the market is softening. They can smell the desperation. And after years of being told “you’re lucky we picked you,” they’re finally saying, “Prove you’re worth my money.”

Exposing the Worst Units—and Walking Away

Another trend? Renters refusing garbage.

Listings that once passed for “budget housing” are now being called out, publicly and loudly:

  • Moldy basements with exposed wires? Screenshotted and posted on Reddit’s r/Vancouver.

  • No oven, no heat, and $1,900/month? Shared with 5,000 followers on Instagram by @vancouvertenantsunion.

  • Four tenants per room? Mocked on TikTok with 250,000 views.

Landlords are getting ratioed online. Buildings are getting reputations. And more renters are keeping receipts, tracking past listings, and warning others. The fear of vacancy is finally greater than the fear of tenant leverage—and landlords are adjusting.

Ghost Landlords, Rental Fraud, and the Collapse of Subletting Empires

The downturn hasn’t just created empowered renters—it’s also exposed the darkest corners of the rental market: illegal subletters, unlicensed operators, and pure scams. Now that the easy money is gone, the skeletons are falling out:

  • Tenants posing as landlords are getting sued for taking deposits on apartments they don’t own.

  • Rental scams are spiking as desperate renters cling to the few listings they can afford—often getting conned into e-transferring deposits for units that don’t exist.

  • Landlords returning from overseas are discovering their “mortgage helper” tenants have been running Airbnb or room-by-room sublets without permission for two years.

The entire rental ecosystem—once built on handshake agreements and willful ignorance—is coming undone.

Municipal bylaw officers are now fielding more complaints about unauthorized suites, illegal units, and over-occupancy than ever before. But enforcement is still weak. And until regulation catches up, renters are forced to navigate the remains of a wild west that’s falling apart in slow motion.

The Vancouver Tenants Union Is Getting Louder

Meanwhile, groups like the Vancouver Tenants Union are capitalizing on the shift.

  • Advocating for vacancy control to prevent post-tenant rent spikes.

  • Organizing renters in buildings where landlords are attempting illegal evictions.

  • Creating databases of bad landlords and sharing them publicly.

  • Pushing for legal reforms to make mass subletting and rent gouging illegal.

With tenants finally realizing they’re the ones driving the market now, the political winds are changing too. Provincial candidates are pivoting toward renter-friendly platforms, and housing advocates are gaining traction. We’re seeing the early stages of a renter political awakening—one that might reshape how the city thinks about housing entirely.

Where This Goes: The Long-Term Consequences of Letting a Rental Economy Eat Itself

The 2025 rental collapse in Vancouver isn’t just a market correction. It’s a reckoning—one decades in the making. We built a rental economy on short-term foreign students, unregulated subletting, and investor landlords chasing ROI instead of livability. We allowed greed to replace planning, desperation to replace dignity, and speculation to replace shelter.

Now that the machine has stalled, we’re left with a question nobody in government seems eager to answer:

What comes next?

Because we’re not just dealing with a blip. We’re facing a structural failure—and its impacts will ripple across housing, policy, and even city culture for years to come.

The Myth of Vancouver as a “Renter’s Paradise” Is Dead

For years, Vancouver attracted young people from around the world with the promise of urban beauty, job opportunity, and an international lifestyle. Renting here—though expensive—was once tolerable. You lived small, paid big, but felt like part of a global, growing, modern city. Now?

  • The glamor is gone.

  • The trust is broken.

  • And the basic promise—that if you worked hard, you could make a life here—is falling apart.

In survey after survey, people are planning to leave. A 2025 Angus Reid poll found that 42% of renters under 40 in Metro Vancouver are actively looking to move to another city or province. The most common reasons?

  • Rent too high

  • Poor quality of housing

  • Feeling exploited or unsafe as tenants

If nothing changes, Vancouver will become a city of landlords without tenants—overpriced units gathering dust while workers, artists, students, and families flee to Edmonton, Calgary, or Montreal in search of actual futures.

Landlords May Finally Face Regulation They Can’t Dodge

The B.C. government has long avoided strong tenant protections, preferring tax tweaks and developer incentives over real reform. But the public mood is shifting. And with housing now the number one provincial concern—outranking healthcare, climate, and jobs—it’s only a matter of time before someone pushes through:

  • Vacancy control (tying rent increases to the unit, not the tenant)

  • Rental registry with unit-by-unit pricing transparency

  • Penalties for illegal subletting and ghost landlords

  • Property taxes based on actual occupancy, not just ownership

  • Enforcement of minimum standards for health and safety in rental units

These were unthinkable policies five years ago. Now? They’re mainstream talking points. If renters continue organizing, and vacancy keeps climbing, the political cost of ignoring tenant rights will soon outweigh the donations of the real estate lobby.

The Investor Model Is Falling Apart

For decades, people in B.C. bought property not to live in—but to extract income from. Rent was seen as a revenue stream, not a social contract. It worked because the math worked.

But now:

  • Rents aren’t climbing

  • Vacancy is rising

  • Students are gone

  • Airbnb is being cracked down on

  • Interest rates are still high

  • Property taxes are rising

  • Maintenance costs are exploding

And the properties themselves? Sitting. Quietly bleeding money.

Some landlords will tough it out. Others will sell into a falling market. And still others will cling to denial—refusing to drop rents, refusing to upgrade units, and praying for a recovery that may never come.

The age of passive rental wealth is over. The age of accountability is (maybe) beginning.

Vancouver Has to Decide What Kind of City It Wants to Be

That’s the core issue. Because behind all the stats, stories, and suffering, the real question is this:

Who is this city for?

Is it for students paying $1,200/month to sleep in a dining room?

Is it for landlords collecting 4:1 sublet ratios in cash?

Is it for developers building luxury towers no one lives in?

Or is it for the people who actually live, work, and build lives here?

The rental bubble burst because we forgot that housing is a human need—not a hedge fund. And now that the system is cracking, we have a rare opportunity to rebuild something better. Or we can let it rot again.

 

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