Wave of Foreclosures Hit Greater Vancouver Real Estate

A wave of court-ordered sales is hitting the BC real estate market, and the Lower Mainland appears to be experiencing some of the largest increases.According to data reported by real estate search platform Zealty, court-ordered listings have more than tripled from the levels we were seeing just a few years ago.As a REALTOR® who deals with more than my fair share of court-ordered sales, I can tell you that I'm seeing this firsthand.I've personally dealt with more court-ordered sales in 2026 than in any other year of my real estate career.Courtrooms dealing with these properties have become noticeably busier, and if the current pace continues, we could be heading toward the highest number of court-ordered listings in the available data.But there's something particularly interesting about this latest wave.It's not happening in exactly the same places or for exactly the same reasons as previous foreclosure cycles.

Court-Ordered Listings Are Approaching Record Levels

In 2025, approximately 773 court-ordered listings came onto the market in BC.That's roughly three times the annual average recorded between 2017 and 2022.Those earlier years were unusually low, however, and there's an important reason for that.Real estate values increased dramatically through much of that period. Homeowners who ran into financial trouble often had substantial equity available in their properties.Instead of reaching the point of foreclosure, many could refinance or simply sell their property and pay off their debts.That safety net has become much weaker as prices have fallen and borrowing costs have increased.So far in 2026, approximately 845 court-ordered listings have already come to market. If the current pace continues, that number could exceed 1,200 by year-end.That would be the highest level in the available data, which goes back roughly 20 years.

Not Every Court-Ordered Sale Is a Foreclosure

This is an important distinction.People often use "foreclosure" and "court-ordered sale" interchangeably, but they aren't necessarily the same thing.A court can order a property sold for several reasons.Mortgage default and foreclosure are obviously among them, but court-ordered sales can also result from bankruptcies, lawsuits, partnership disputes, divorces and other legal circumstances.So we shouldn't assume that every one of these listings represents a homeowner who stopped making their mortgage payments.But the significant increase in court-ordered properties is still an important indicator of financial stress within the market.

This Cycle Looks Different From 2008

One of the more interesting differences between today's market and the period surrounding the 2008 financial crisis is what's driving some of the financial pressure.During previous downturns, job losses were a major contributor to mortgage distress.This time, higher carrying costs appear to be playing an important role.Think about someone who purchased near the peak of the real estate market in 2021 or 2022.They may have purchased at an extremely high price while financing that property with an extraordinarily low mortgage rate.That mortgage eventually needs to be renewed.If the homeowner is refinancing into a significantly higher rate, the value of the property has declined and their other household expenses have increased at the same time, the financial equation can become much more difficult.For most homeowners, that doesn't mean foreclosure.But for households that were already stretched financially, substantially higher carrying costs can become the final problem they aren't able to overcome.

The Geography of Court-Ordered Sales Has Changed

Another major difference is where we're seeing the increases.Historically, financial distress often showed up more heavily in relatively affordable suburban markets.This time, some of the largest increases are occurring in much more expensive areas.West Vancouver, for example, has reportedly experienced an increase of approximately 295% in court-ordered sales, while Vancouver is up approximately 158%.The properties involved aren't necessarily entry-level homes either.The court-ordered inventory has included luxury properties, including a six-bedroom, nine-bathroom Shaughnessy home with an infinity pool listed above $10 million.At the same time, some traditionally more affordable areas are actually seeing fewer court-ordered sales than during the 2008 period.Maple Ridge, Pitt Meadows and Port Coquitlam are reportedly below those previous levels by approximately 35% to 66%.

What About Surrey and Langley?

This is where the numbers become particularly relevant to my own real estate market.Langley is reportedly about 15% below its previous comparison level.But Central Surrey and North Delta have experienced increases of approximately 150% to 162%.Those numbers line up with what I'm seeing in my own business.I'm seeing more court-ordered listings, dealing with more of these transactions personally and following considerably more of them through the MLS than I have in previous years.This isn't simply something showing up on a chart.It's becoming a noticeable part of our local real estate market.

There Could Be More Coming

This may be the most concerning part of the story.Court-ordered sales don't happen overnight.The legal process can take a significant amount of time, and in some cases a property may not actually reach a court sale until long after the homeowner's original financial problems began.That creates a lag.In other words, some of the court-ordered properties we're seeing today may reflect financial trouble that began well before 2026.If household finances have continued deteriorating through 2025 and 2026, it's reasonable to watch closely for whether additional distressed properties continue working their way through the system.We won't know the eventual scale until it happens, but the current trend is worth paying attention to.

What Does This Mean for BC Home Prices?

Court-ordered sales can add additional downward pressure to an already weak real estate market.Lenders and other parties involved in these transactions generally have a different motivation from a typical homeowner.A traditional seller may simply decide not to sell if they don't like the price the market is offering.A distressed property doesn't necessarily have that same flexibility.Eventually, the objective is to complete a sale.As more distressed properties sell, those transactions become part of the comparable sales data buyers, sellers, appraisers and REALTORS® use to establish current market value.That's one reason an increase in court-ordered sales matters even if your own home isn't in financial trouble.Your property is still competing within the same marketplace.

What Does This Mean for Sellers?

For sellers, this reinforces something I've been saying throughout this declining market.If you've already decided that you need or want to sell, waiting for yesterday's price to return can be risky.A court-ordered property selling nearby can become another comparable sale buyers use when deciding what they're willing to pay for your home.That doesn't mean you should panic and sell simply because foreclosures are increasing.But if you're planning to sell anyway, you need to understand the direction of your specific market and price your property accordingly.In a declining market, a sooner sale can sometimes be a higher sale.

Are Foreclosures Great Deals for Buyers?

This is where I think there's a major misconception.Buyers hear the word "foreclosure" and immediately imagine buying a property for some ridiculous discount.That's generally not how these transactions work.A court-ordered property can certainly create an opportunity, particularly in a declining market.But these sales also come with significant risks and a very different purchasing process.There may be limited representations about the property. The condition can be uncertain. The process can involve court approval, competing bids and considerably less certainty than a traditional transaction.Most importantly, simply writing an extremely low offer doesn't mean the court is going to hand you the property.A distressed sale is not automatically a fire sale.

Buyers Need to Understand the Process

If you're considering purchasing a court-ordered property, education is extremely important.These aren't transactions where I would recommend assuming the process works exactly like a normal resale.You need to understand what you're buying, what protections you may or may not have, how court approval works and what could happen if other buyers become involved.The potential opportunity has to be weighed against the additional risk.That's especially true as more buyers become interested in these properties.A surge in court-ordered listings doesn't necessarily mean nobody wants them. In fact, attractive properties can generate significant attention precisely because buyers believe there may be an opportunity.

Is This Another Sign of Stress in the BC Real Estate Market?

I think the increase in court-ordered sales is another important indicator to watch.It doesn't mean we're suddenly facing a foreclosure crisis everywhere in British Columbia.And it certainly doesn't mean every homeowner with a mortgage renewal approaching is in trouble.But court-ordered listings are increasing significantly, some of the largest increases are occurring in expensive Lower Mainland markets, and higher carrying costs are putting additional pressure on households that may already have been financially stretched.For sellers, more distressed inventory can create additional competition and downward pressure on prices.For buyers, it may create opportunities, but those opportunities come with additional complexity and risk.And for homeowners who are already struggling financially, the most important thing may be dealing with the problem early rather than waiting until someone else is making the decisions for you.The numbers are telling us that court-ordered sales are becoming a much more significant part of today's real estate market.Where they go from here is something I'll be watching very closely.Written by:
Steve Karrasch PREC
Karrasch Real Properties Team
Macdonald Realty