Metro Vancouver’s real estate industry leaders are becoming increasingly concerned about a glut of unsold new condominium units, CBC reported.

The unsold new-condo industry has doubled year-over-year to about 2,500, according to Canada Mortgage and Housing Corporation figures. Anne McMullin, president and CEO of the Urban Land Institute, attributed the increase to higher prices.

“Costs have escalated so much in the last 10 years that to build a unit is out of the price range of 80 per cent of the public in the Metro Vancouver area,” McMullin told CBC.

She criticized government for contributing to the problem.

“The cost that is associated with policies at all three levels of government has made it that we can no longer build what people can afford,” McMullin told her interviewer.

In June, Square Nine Developments held a one-day flash sale on a new Surrey condo development that had been slow to sell, generating 63 deals with more anticipated. Meanwhile, many would-be buyers surrendered deposits as they walked away from their presale agreements. Many other would-be purchasers of other presold units have done likewise, placing a strain and developers that has resulted in more distressed-asset sales across the region. Meanwhile, some developers have switched planned condo projects to purpose-built rental developments.

McMullin told CBC that she hopes Vancouver-area municipalities will review their various policies and requirements, including those for non-market rental housing, energy codes and public art.

Greg Zayadi, president of Vancouver-based condo marketing firm Rennie, told CBC that the market has been slowing down for three years after enjoying two decades of good times. But the decline will have large ripple effects across the labour pool.

“The last time we saw this level of developer-owned unsold inventory was 24 years ago,” he told his interviewer.

Developers must understand prospective buyers do not want to shell out $800,000 for a unit that comprises only 400 to 500 square feet; they prefer units spanning 800 to 1,500 square feet for a price of $800,000 to $1.2 million, he added.

“We need to get to a point where we can deliver inventory as an industry, as a province, at $700 to $900 a square foot,” he told CBC. “That’s $200 to $300 above where the market is today.”

According to Zayadi, most of the unsold units are located in Burnaby, Coquitlam and parts of Surrey. Earlier this year, Rennie launched a new division dedicated to selling conventional commercial properties, such as retail, to offset the slowdown in its long-time condo-marketing specialty.

Oleg Galyuk, Royal Pacific Realty agent, told CBC that many developers are offering incentives, including cash-back options on completion, in presale agreements.

“Right now, a lot of condos [are] coming online that people don’t really want to live in,” Galyuk told CBC.