The Great Presale Disappearing Act Reshaping Vancouver Real Estate with Jon Bennest

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What happens when 15,000 active listings meet only 2,000 quarterly sales? Former Urban Analytics co-owner and current Zonda Urban VP Jon Bennest sits down with Adam & Matt to reveal why half of Metro Vancouver’s pre-sale inventory could up and vanish from the market in the next two years.

Drawing on exclusive market data and 20 years of industry expertise, Jon explains the dramatic implications of the shift from investor-driven to end-user markets where many projects struggle to reach even 30% sold. From standing inventory opportunities to the challenges facing major developments, this insider conversation reveals exactly where the opportunities and pitfalls lie for buyers navigating today’s uncertain market. What exactly defines the “Goldilocks Zone” where certain projects are still selling briskly? How many interest rate cuts will finally “bring the market back”? And what counterintuitive investment strategy does Jon favour that contradicts conventional wisdom about chasing hot neighborhoods?

Don’t miss this essential market intelligence from one of the industry’s most respected data analysts.

Pre-Sale Market Oversupply: Is There a Tipping Point?

The Metro Vancouver real estate market is in flux, especially in the new home and pre-sale sector. Jon Bennest, VP of Product Development at Zonda Urban, shares in this episode that there are now approximately 15,000 active listings of new home product across the region—but only 4,000 total sales in the past two quarters combined.

That gap represents a sharp departure from historical norms and places the market at around 24 months of supply—a buyer’s market by any definition. The majority of these listings are pre-construction condos and townhomes, many of which may not even be built.

The 60% Sales Threshold: Why It Matters

In Metro Vancouver’s pre-sale condo market, 60% sold is the magic number. Developers typically need to pre-sell at least 60% of their units to secure construction financing. But Bennest notes that many projects are only hitting 10–30%, leaving them in limbo.

When a project fails to reach that financing threshold within 12 months of signing contracts, REDMA regulations kick in—requiring developers to either start construction or offer buyers a deposit refund. This built-in system protects consumers, but it also means a large portion of today’s inventory may never get built.

Standing Inventory = Immediate Buyer Opportunities

What does exist—and can be moved into—is standing inventory: completed, unsold new homes. According to Bennest, Zonda Urban is currently tracking approximately 1,800 units of completed, unsold inventory, with another 2,600 units expected to complete in the next year.

These properties represent a unique window of opportunity for end-user buyers looking for:

• Immediate occupancy
• Brand-new construction
• Deep discounts from peak pricing (especially in Burnaby and Richmond, where developers are motivated to sell)

Developers are offering incentives, lowered deposits, and even enhanced realtor commissions to move the last remaining units in a building. In a market with few levers to reduce prices due to persistent construction costs, this is where buyers can gain negotiating power.

The Goldilocks Zone: Where Projects Are Succeeding

Despite the broader slowdown, Bennest says some projects are thriving—specifically in what Zonda Urban calls the “Goldilocks Zone.” These are:

• Low-rise developments
• Fewer than 200 units
• Priced under $1,000/sq ft (often in the $800–$900 range)
• Located south of the Fraser: Langley, Surrey, South Surrey, and Abbotsford

These projects benefit from lower construction costs, faster build timelines (2–4 years), and smaller sales targets—making it easier to hit pre-sale financing thresholds.

For example, a 100-unit low-rise project needs just 60 sales to break ground, versus a 500-unit tower that might require 300+ pre-sales. That difference is huge in today’s cautious market.

Why Price Matters More Than Location in 2025

One of the most striking insights from this episode is the decline of location-based premiums. In the current environment, buyers are prioritizing price per square foot over neighbourhood prestige.

Projects once viewed as less desirable—like those on busy roads or in light industrial areas—are still selling, if the pricing is right. This is especially true in Surrey, where Bennest notes the pricing gap between neighbourhoods like Newton and Fleetwood has flattened out dramatically.

Buyers are willing to migrate outward for more space and affordability, even if it means giving up a prime location.

The Shift Toward Purpose-Built Rentals

As feasibility continues to challenge condo developers, many are pivoting to rental development. Zonda Urban reports a noticeable shift in advisory requests toward purpose-built rental projects. CMHC’s now-expired financing support was a driver here, but the trend continues.

Without investor pre-sales and with construction costs remaining high, rentals offer a viable alternative—though one that concentrates ownership in the hands of large institutional developers and REITs.

Interest Rates & Affordability: The Next Catalyst?

So what brings the market back? According to Bennest, it’s simple: affordability.

We’re approaching a tipping point where monthly mortgage costs rival or beat monthly rent, especially as interest rates ease. Another 25–50 basis point drop could be enough to reinvigorate demand, just as it did in the post-2008 rebound.

Bennest believes we’re not far off from a turnaround, especially for buyers with a long-term horizon and a clear grasp of today’s pricing dynamics.

Where Should Buyers Be Looking in 2025?

For those serious about getting into the Metro Vancouver housing market, Bennest offers data-backed recommendations:

• Burnaby & Richmond: Look for completed or nearly complete standing inventory. Units that were $1,200–$1,400/sq ft at the peak are now available around $1,000/sq ft or less.
• Langley, Surrey, Abbotsford: The sweet spot for low-rise pre-construction condos under $1,000/sq ft, particularly for first-time buyers or those chasing affordability.

Completed inventory over pre-sales: Prioritize units already under construction or built—especially for buyers who want certainty in delivery.

Frequently Asked Questions (FAQ)

What’s the main challenge in Metro Vancouver’s pre-sale condo market?

Developers aren’t hitting the 60% pre-sale target needed for construction financing. This is delaying or canceling many new projects.

Is now a good time to buy new construction in Vancouver?

Yes—especially if you’re an end user. Completed units (standing inventory) in Burnaby and Richmond are discounted and ready to occupy.

What is the Goldilocks Zone in Metro Vancouver real estate?

It refers to low-rise projects under 200 units, priced under $1,000/sq ft, typically located south of the Fraser in areas like Surrey and Langley. These projects are currently outperforming the market.

How long will this market condition last?

If interest rates continue to fall, buyer activity could rebound in the next 12–18 months. Conditions are aligning for affordability-driven demand to return.

Should I invest in pre-construction or resale right now?

Focus on value and risk mitigation. Many buyers are choosing completed new units over long delivery pre-sales, especially in high-inventory areas.

Last updated April 17 2025 by Adam Scalena PREC.