HARD TIMES HIT HOME

Num­bers point to ‘big trouble’ for the fin­ances of both res­id­ents and investors

West Van­couver has recor­ded 295 per cent more court-ordered list­ings this year com­pared to the aver­age after the global fin­an­cial crisis in 2008.

Vancouver Sun

DAN FUMANO

12 Sep 2026

New data from B.C. real estate search plat­form Zealty shows the annual num­ber of court-ordered home list­ings in the Lower Main­land has more than tripled over the last three years. The trend indic­ates `the eco­nomy is not in good health,' says Zealty pres­id­ent Hamidreza Ete­barian. “Fore­clos­ure day” at the Van­couver court­house has been a busy scene recently.

Every Monday and Thursday morn­ing, law­yers rep­res­ent­ing mort­gage lenders such as banks bring fore­clos­ure pro­ceed­ings to B.C. Supreme Court in down­town Van­couver, aim­ing to force the sale of prop­er­ties whose own­ers have stopped mak­ing their monthly pay­ments. Homeown­ers, realtors, pro­spect­ive buy­ers, and oth­ers often appear as well. It can get crowded.

“You see indi­vidual law­yers who reg­u­larly appear, they have their bind­ers of papers, sit­ting at the front table wait­ing to get through their mat­ters. But then you also are start­ing to see self-rep­res­en­ted homeown­ers appear, you see poten­tial pur­chasers and the realtors there. Occa­sion­ally, people are look­ing to snap up a deal,” said Cody Reed­man, a Van­couver law­yer who spe­cial­izes in insolv­ency and reg­u­larly works on behalf of homeown­ers whose prop­er­ties have been fore­closed on by lenders.

“Fre­quently, it starts to spill out into the hall­way, and it can be hard to find seat­ing.

“We've had days when our office has gone to court, and there are over 60 mat­ters ... sched­uled in fore­clos­ure cham­bers for a single day in front of a single asso­ciate judge,” Reed­man said.

Law­yers and realtors work­ing in this area say fore­clos­ure days in court are notice­ably busier now than in past years.

Court regis­tries in other B.C. cit­ies have their own des­ig­nated days for fore­clos­ures, and new stats show a steady increase in fore­clos­ure activ­ity provincewide in recent years. The num­ber of fore­clos­ures ini­ti­ated by lenders in B.C. has more than tripled over the last five years, accord­ing to data from B.C.'S Min­istry of the Attor­ney Gen­eral, reach­ing a 10-year-high in the last fiscal year.

New data provided to Post­me­dia from the B.C. real estate search plat­form Zealty shows the annual num­ber of court-ordered home list­ings in the Lower Main­land has more than tripled over the last three years.

“This is an indic­ator,” said Zealty pres­id­ent Hamidreza Ete­barian. “The gov­ern­ment depends on real estate for its health and for its GDP. And this basic­ally shows that the eco­nomy is not in good health.”

Zealty, which has more than 150,000 monthly users and is affil­i­ated with Holy­well Prop­er­ties real estate broker­age, estim­ates 2026 could reach a 20-year high in court-ordered list­ings, which is as far back as the com­pany's data goes and would exceed the peak levels fol­low­ing the 2007-08 global fin­an­cial crisis.

The com­pany's data shows 773 court-ordered list­ings last year in the areas rep­res­en­ted by the Greater Van­couver and Fraser Val­ley real estate boards. That was roughly triple the annual aver­age between 2017 and 2022. But the first eight months of this year blew past that num­ber, with 845 court-ordered list­ings hit­ting the mar­ket between Jan. 1 and Aug. 31.

If the pace of list­ings for the rest of this year matches the aver­age in the first eight months, 2026 could see more than 1,200 court-ordered home list­ings, Ete­barian estim­ates. Although the totals also include other legal pro­ceed­ings, includ­ing bank­ruptcies and fam­ily act fil­ings such as divorces, most of these court-ordered list­ings stem from fore­clos­ures.

The Greater Van­couver and Fraser Val­ley real estate boards include most of B.C.'S total res­id­en­tial unit sales, encom­passing the area from Whist­ler and Squam­ish south through the Sun­shine Coast, to Van­couver, Sur­rey and the Metro sub­urbs east to Mis­sion and Abbots­ford. As of this month, Zealty does not have access to data for court-ordered sales and list­ings in other parts of the province, but data provided by the B.C. Min­istry of the Attor­ney Gen­eral shows a sim­ilar trend played out in fore­clos­ure activ­ity on a provincewide scale over the past 20 years: a surge in the years after the global fin­an­cial crisis of 2008, fol­lowed by a steady decrease between 2012 and 2016, a few years of rel­at­ively low levels, and then a steady increase start­ing in 2022.

The B.C. gov­ern­ment's num­bers rep­res­ent all new fore­clos­ure pro­ceed­ings, includ­ing all kinds of res­id­en­tial and com­mer­cial prop­er­ties, filed in B.C. Supreme Court for each fiscal year, and not all of them res­ult in a court-ordered sale.

Zealty's num­bers come from a search fil­ter of court-ordered list­ings for indi­vidual homes, which includes houses, con­dos, and town­houses, but not com­mer­cial prop­er­ties, whole apart­ment build­ings, vacant land or other kinds of estates.

B.C. has also seen a recent surge in developer and com­mer­cial receiv­er­ships and fore­clos­ures, but Zealty's new data reflects something dif­fer­ent, Ete­barian said: fin­an­cial dis­tress at the level of indi­vidual res­id­ents and investors. The num­bers look like “big trouble,” he said.

FORECLOSURES HAVE 'SHIFTED UPMARKET'

Zealty's data shows this wave of court-ordered list­ings has a dif­fer­ent pro­file and geo­graphy from the pre­vi­ous surge more than a dec­ade ago fol­low­ing the fin­an­cial crisis, Ete­barian said.

“There is a big dif­fer­ence between this crisis and the pre­vi­ous one,” Ete­barian said. “I would say the '08 cycle was about people los­ing their jobs. But this cycle is about people who bor­rowed cheaply at the top of the mar­ket, and now they can­not carry the cost.”

Ete­barian sees many court-ordered list­ings for high-end homes pur­chased in 2020 and 2021 in expens­ive neigh­bour­hoods, at a time when Cana­dian interest rates were at their low­est in recent his­tory. As those five-year mort­gages came up for renewal last year and this year, this cohort of buy­ers is facing much higher monthly pay­ments, and many appear to be strug­gling.

After the 2008 fin­an­cial crisis, many court-ordered sales appeared in rel­at­ively afford­able parts of the region such as the Fraser Val­ley and the Tri-cit­ies, often when middle-class homeown­ers fell on hard times and struggled to keep up with their pay­ments, Ete­barian said.

The new wave of fore­clos­ures has “shif­ted upmar­ket,” he said, with the region's most expens­ive hous­ing mar­kets see­ing a surge of activ­ity.

This year, West Van­couver has recor­ded 295 per cent more court-ordered list­ings com­pared to the annual aver­age after the global fin­an­cial crisis, Zealty's data shows, and on Van­couver's west side, the num­ber has more than doubled.

Mean­while, hot spots for court-ordered sales after the 2008 crisis, such as Maple Ridge, Pitt Mead­ows and Port Coquit­lam, are record­ing sig­ni­fic­antly lower levels than their post-2008 pace.

Ete­barian poin­ted to a 10,000-square-foot, six-bed­room, nine-bath­room man­sion with an infin­ity pool in Van­couver's tony Shaugh­nessy neigh­bour­hood that went through a $10 mil­lion court-ordered sale this sum­mer — less than half the price it was lis­ted for a few years earlier. In the spring, a six-bed­room man­sion in West Van­couver's Brit­ish Prop­er­ties went through a court-ordered sale of $6 mil­lion — more than $1.5 mil­lion less than the price the seller bought it for five years earlier.

These examples, Ete­barian said, are “the kind of prop­erty that simply did not appear on fore­clos­ure rolls dur­ing the pre­vi­ous cycle.”

“Back in the day, we wouldn't really see any prop­er­ties in West Van, or Van­couver West Side, expens­ive prop­er­ties being fore­closed . ... Now, it's not all of them, but we do see a lot,” he said.

“These guys that are selling these expens­ive prop­er­ties today, they're not middle-class. They are actu­ally wealthy people who (were) liv­ing in a $4 mil­lion prop­erty, and then sud­denly they say, `Oh, mort­gages are cheap now, let me upgrade to an $8 mil­lion prop­erty.'”

SHORTFALL

Not every fore­clos­ure fil­ing leads to a court-ordered sale. The pro­cess typ­ic­ally works like this: After a prop­erty owner has missed mort­gage pay­ments for a period of time, the lender con­tacts the bor­rower to warn that fore­clos­ure pro­ceed­ings will be ini­ti­ated if the arrears are not paid in full before a cer­tain date. After that, the lender's law­yers can start fore­clos­ure pro­ceed­ings in B.C. Supreme Court, after which a judge will typ­ic­ally give the prop­erty owner a chance to pay the full amount owing, plus interest, by a cer­tain date — usu­ally six months. After that period expires, the lender can seek a court-ordered sale of the prop­erty to recover the debt.

The whole pro­cess — from the first missed pay­ment, to demand let­ters, to fore­clos­ure fil­ings, to a court-ordered sale hit­ting real estate list­ings — often takes close to a year or more.

Dur­ing B.C.'S pre­vi­ous surge of fore­clos­ure activ­ity, in the years after the 2008 global fin­an­cial crisis, most fore­clos­ure pro­ceed­ings that were ini­ti­ated didn't go all the way to a court-ordered sale, said Simon Clayton, a realtor for 23 years with Mac­don­ald Realty in Van­couver who fre­quently works on court-ordered sales, usu­ally rep­res­ent­ing lenders.

In past years, while the real estate mar­ket was gen­er­ally going up, even if a prop­erty owner was unable to keep up with their mort­gage pay­ments, they could sell the prop­erty, pay out the lender, and move on, Clayton said.

“If someone owes a lender $1 mil­lion, and their place was worth $1.5 mil­lion, and they could quite eas­ily find someone who would give them some money to cover that debt, it pays off the lender, and the pro­ceed­ings stop.”

That has changed in the last two years, Clayton said.

Now, more fore­clos­ure files are pro­ceed­ing all the way to a court-ordered sale, he explained, because in today's slow hous­ing mar­ket, own­ers are often unable to sell their prop­er­ties for the price they paid a few years earlier or, in some cases, even at a price that cov­ers the debt.

“A lot of them are in short­fall,” Clayton said, “which essen­tially means that the debt is higher than what it can be sold for.”

In some cases, own­ers are find­ing them­selves in fore­clos­ure court over prop­er­ties they have owned for dec­ades, but “they've just refin­anced them to death, and maybe fallen on hard times,” Clayton said. “I have a lot of empathy for these people because, you know, not everything goes up forever. A lot of the time, they have mul­tiple mort­gages registered, and it just adds up, and then there's no equity left.”

Clayton reg­u­larly attends fore­clos­ure days at the Van­couver court­house, and they are notice­ably busier lately.

“You can see how busy the courtroom is,” he said. Fore­clos­ures still rep­res­ent “a small per­cent­age of the over­all list­ings, but there's def­in­itely an increase.”

Prop­er­ties in fore­clos­ure court are a mix of homeown­ers' prin­ciple res­id­ences and prop­er­ties owned by investors. The investor-owned prop­er­ties are often mid- to lower-priced con­dos, where a com­bin­a­tion of lower mar­ket rents and higher mort­gage and insur­ance pay­ments mean the land­lord can no longer cover the monthly cost of own­ing the unit, Clayton said.

The cur­rent situ­ation is not bad news for every­one. Ten­ants are see­ing lower rents, and more choice in the mar­ket than they have seen in years.

There could be oppor­tun­it­ies for first-time buy­ers to enter the mar­ket when investors are forced to sell homes at a loss, but “the trouble is there's not a lot of con­fid­ence when the mar­ket's not bound­ing along,” Clayton said. “Buy­ers don't have much con­fid­ence, so some­times those oppor­tun­it­ies are missed because people are too nervous . ... There's a lot of nervous­ness in the mar­ket in gen­eral.”

For homeown­ers fight­ing to keep their prin­ciple res­id­ence, it's “a series of cir­cum­stances that have led to, really, an unfor­tu­nate situ­ation,” he said.

Clayton would like to see fore­clos­ure levels decrease, but based on broader eco­nomic con­di­tions, he believes, “They'll prob­ably remain steady for the fore­see­able future.”

“You don't want to see people lose their homes,” he said. “I'd be per­fectly happy not hav­ing a bunch of court list­ings.”

`THE MECHANICAL BULL'

A national sur­vey released last month by Royal Lepage found anxi­ety around mort­gage renew­als tends to be higher in B.C. than else­where in Canada, because the out­stand­ing mort­gage bal­ances are often much lar­ger.

The same increase in interest rates that adds a few hun­dred dol­lars to a monthly pay­ment in other parts of Canada can have a much big­ger impact in Metro Van­couver, the Royal Lepage release said.

Of the respond­ents who expec­ted their mort­gage renewal would cre­ate fin­an­cial strain, more than one-third said they would reduce spend­ing on essen­tials such as gro­cer­ies and gas, and almost one in five said they plan to obtain a second job or new source of income, Royal Lepage repor­ted.

In Que­bec, Saskat­chewan, Man­itoba and Atlantic Canada, between 12 and 13 per cent of those respond­ents said the impend­ing mort­gage renewal made them con­sider chan­ging their liv­ing situ­ation, such as selling their home and mov­ing in with fam­ily or becom­ing a renter.

In Van­couver, the pro­por­tion was more than 29 per cent.

Mort­gage delin­quency rates in Canada are still very low as a per­cent­age of all mort­gages — less than one per cent in B.C. in the Canada Mort­gage and Hous­ing Corp.'s most recent num­bers — but they have been rising in recent years.

In May, Equifax Canada repor­ted the growth in mort­gage delin­quency rates revealed “severe fin­an­cial strain in high-priced mar­kets,” includ­ing a 36 per cent year-over-year jump in B.C. (second only to Ontario).

The present situ­ation in B.C. is a far cry from the much higher mort­gage delin­quency rates recor­ded in parts of the U.S. after the 2008 crisis, said Thomas Dav­idoff, an asso­ciate pro­fessor of real estate at the Uni­versity of B.C.'S Sauder School of Busi­ness.

“It's still a very low num­ber,” Dav­idoff said, “but the trend is not our friend. It's not a good dir­ec­tion.

“The cur­rent eco­nomy (in B.C.) is not great, but it's lethal for the real estate industry. And real estate's a pretty big part of the Greater Van­couver eco­nomy.

“It's sort of like rid­ing the mech­an­ical bull. It's tough when interest rates rise and the eco­nomy's weak, and there's tar­iffs, and infla­tion for stuff you need, and you hold on as long as you can, and even­tu­ally you fall off,” Dav­idoff said. “And there's every reason to think the num­ber of people fall­ing off the mech­an­ical bull of mak­ing mort­gage pay­ments is going to con­tinue to go up.”