Chilliwack real estate may finally be moving towards a buyers’ market, according to the local real estate board. (Paul Henderson/ Progress file)

Drop in Chilliwack home sales attributed to ‘stress test’

Number of sales down 36 per cent with average price up 18 per cent

It’s finally possible local real estate could be heading towards a buyers’ market as sales slowed last month due to the new mortgage “stress test,” according to the Chilliwack and District Real Estate Board (CADREB).

There were 324 sales of all types of residential homes in May, which compares to 511 for the same month in 2017.

• READ MORE: Chilliwack home sales shoot up in May as prices hit new highs

“With all other variables being fairly constant such as a strong provincial economy and moderate hikes in interest rates, the drop can be attributed to the more stringent lending rules introduced by the federal government early this Spring,” said Chilliwack and District Real Estate Board (CADREB) President Lori Maier.

• READ MORE: New mortgage rules could cool Chilliwack and district real estate for 2018

Maier said that given B.C.’s economy remains strong during a month when home sales are typically at their strongest, the sales dip points only in one direction: the new mortgage rules.

Under the new regulations, potential home buyers need not only qualify for the amount borrowed on a new home, but have to be able to withstand any future mortgage rate interest hikes.

“This likely has caused some first-time buyers especially to put their home-buying plans on hold,” Maier said. “The recent issues of a trade war [between Canada and the U.S.] isn’t helping to instill confidence either.”

And while sales last month at 324 represent a 36 per cent drop over May 2017, that number is still higher than the 10-year average for that month. Since 2009, the average number of sales for May was 314.

Sales may have dipped year over year, but prices are up a lot. The average price of a home sold last month was $538,999 up 18 per cent from the average or $457,956 in May 2017.

That despite the fact that single family home and townhouse sales dropped considerably, with apartment sales staying level.

“At 63, apartment sales were strong, indicating stronger demand for lower price points,” CADREB said in a press release.

The high end of the market continues to prove popular too, however, with 14 sales over the $1 million mark, including one over $2 million.

Of the 324 sales posted last month, the highest number (40) were in the $550,000 to $599,999 range followed by 39 in the $450,000 to $499,999 range.

After several months of well-below average listings, the supply of homes for sale is increasing to a healthier level, with 1,277 homes on the market at the end of May, compared to 936 in May of last year.

“With decreased sales, it has shifted the local real estate landscape from a seller’s towards a buyer’s market,” Maier said.

Realtors are seeing price reductions on some listings due to slowing sales, so the relative affordability of the Chilliwack and area market remains attractive to buyers, particularly those from the Vancouver area, according to Maier.

• RELATED: Chilliwack real estate prices to keep rising: BCREA forecast


@PeeJayAitch
paul.henderson@theprogress.com

Like us on Facebook and follow us on Twitter.

Just Posted

More than 125 tonnes of garbage hauled in during Fraser River Cleanup in Chilliwack

A total of 700 volunteers flocked to the shores of the Fraser River to help with the cleanup

Seven Days in Chilliwack

A list of community events happening in Chilliwack from March 25 to 31

WATCH: Sparks fly as SUV speeds down wrong side of Highway 1 in Chilliwack trying to flee police

Captured on video, the vehicle headed westbound against oncoming traffic before crashing

Drugs and guns seized by Chilliwack Mounties in complex case

Drug trafficking investigations led to five arrests in three different locations across Chilliwack

Chilliwack RCMP trying to catch robbery suspect

Police hope someone will identify the person who appears in security camera footage

Stolen Bentley spotted going wrong way down highway found in Summerland

The car has been recorded going the wrong way on the Coquihalla, found two days later

Bobrovsky perfect as Blue Jackets blank Canucks 5-0

Vancouver shut out for 10th time this season

Fundraising campaign launched for man caught in SilverStar avalanche

In only two days, the GoFundMe surpassed its $15,000 goal

Terror at sea: Helicopter rescues frightened cruise passengers in Norway

The Viking Sky cruise ship was carrying 1,300 passengers and crew when it experienced engine trouble

Search and rescue team helicopters injured climber from B.C. provincial park

A 30-year-old woman suffered a suspected lower-limb fracture in Skaha Bluffs Provincial Park

DOJ: Trump campaign did not co-ordinate with Russia in 2016

Attorney General William Barr said special counsel “does not exonerate” Trump of obstructing justice

Trudeau in Vancouver to support Tamara Taggart at Liberal nomination event

The former broadcaster is seeking the nomination for the Vancouver Kingsway riding

Trudeau calls May 6 byelection for B.C. riding of Nanaimo-Ladysmith

The riding opened up when Sheila Malcolmson resigned in January

B.C. VIEWS: The hijacking of our education system gathers speed

Children taught to strike and shout fringe far-left demands

Most Read