Ahead of the 2026 Vancouver Real Estate Forum, Shawn Ning, Vice President of Financing, breaks down the trends shaping one of Canada’s most sought-after rental markets and our outlook on areas of opportunity as Vancouver shifts toward rebalancing.
Key Insights
- Softer market conditions are helping Vancouver renters, as vacancy rates remain high amid an influx of new deliveries.
- The overall number of buildings sold increased by 2%, yet transaction volume by dollar value fell 24% in 2025. This suggests broader institutional caution and a flight to quality, lower-ticket deals where buyers can control risk and execution more tightly.
- Developers are taking advantage of R1-1 zoning policies, which allow multi-unit developments to be developed on a single lot. This is becoming increasingly popular in areas such as Vancouver, North Vancouver, Burnaby, Coquitlam, and the Fraser Valley.
Market Fundamentals
As one of Canada’s most popular rental markets, Vancouver is receiving much-needed relief from tighter immigration policies. Rental demand has slowed in tandem with record-high completions, which has improved affordability for existing renters. Year-over-year rent fell 5.76% as of February 20261, attributed to rising vacancy. This was expected, as most of Canada’s top rental markets are working through an influx of new deliveries.
Chart 1: Year-over-Year Change in Average Rent Across the Top Canadian Markets1
Despite a substantial amount of supply for planned developments, many projects may face difficulties balancing pro forma costs and returns. Therefore, actual deliveries of rental units may still lag behind demand, necessitating new developments.
Cap Rates & Transaction Activity
Multifamily cap rates have trended upward since 2021 but remain compressed relative to other asset classes, such as industrial and retail, indicating strong investor demand for multifamily assets. Underlying debt remains less expensive, supported by CMHC programs, ensuring borrowing remains an attractive option for investors. Although cap rates remain comparatively compressed, transaction volume by dollar value fell 24% in 2025, yet the total number of buildings sold increased by 2%.2
This shift toward smaller transactions, despite a decline in dollar volume, suggests broader institutional caution and a flight to quality, lower-ticket deals where buyers can control risk and execution more tightly. This further creates opportunities for value-add investors and regional players to pick up assets at narrower spreads, while larger investors recalibrate their portfolio strategies amid persistent cap‑rate compression and favourable CMHC‑backed financing.
Chart 2: Vancouver Cap Rates Trend Upward3
Market Trends: Multiplexes & The Appeal of Wood-Frame
Zoning laws are reshaping how multifamily housing is being developed in Vancouver. The R1-1 zoning policy, which allows single-family homeowners to build multiple small homes on a single lot, has incited investment interest, with one-third of residential dollar sales reported at the end of 2024 attributed to multiplex redevelopment.4
With developers shifting toward build-to-rent, the cost of construction has become increasingly important, especially as larger builds struggle to pencil out. As a result, wood-frame projects have become a popular option amongst developers due to their cost efficiency. In tandem, these wood-frame multiplex developments are reshaping the Greater Vancouver multifamily market, especially in Vancouver, North Vancouver, Burnaby, Coquitlam, and the Fraser Valley.
Market Outlook
Despite cyclical softening market conditions, Vancouver continues to report strong rental demand supported by job opportunities and location appeal. Vancouver’s growing tech industry, ranked among the top 3 talent hubs in North America, is expected to continue to support rental fundamentals in the city.5
As demographics continue to shift in Vancouver, so will housing preferences. City planners forecast that most residents will live in apartments by 2051, with the share of single-family home occupants dropping by nearly half.6 For multifamily developers and investors, this is an encouraging outlook on Vancouver’s rental market, which will continue to necessitate new supply to meet strong rental demand.
Even as rent growth remains muted, Vancouver has the highest asking rents across Canada, making affordability a primary concern for residents. For developers and investors in the multifamily sector, the need for affordable housing is presenting opportunities, especially with CMHC programs, which encourage affordable developments through favourable lending terms.
The Peakhill Advantage
As a leading CMHC-insured lender, Peakhill is committed to providing flexible financing structures to our clients, offering term, bridge, construction, and CMHC lending options. With $2 billion in total financings across BC markets since inception, Peakhill is an active lender supporting commercial real estate owners and developers. Working alongside our clients, we align financing solutions with project-specific requirements and ever-changing market conditions.
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Let’s continue the conversation
Footnotes
- Rentals.ca. 2026. Rentals.ca March 2026 Rent Report. ↩︎
- RENX. 2026. A year of mixed signals in Metro Vancouver apartment investment. ↩︎
- Colliers. 2025, 2024, 2023, 2022, 2021. Canada Cap Rate Report. ↩︎
- Storeys. 2025. A Third Of All Land Buys Are Now Multiplex: Vancouver’s Zoning Bet Is Paying Off. ↩︎
- BC Times. 2026. Vancouver tech industry 2026 Trends & Growth. ↩︎
- Vancouver Sun. 2025. Majority of Metro Vancouver residents expected to live in condos or apartments by 2051, report predicts. ↩︎
