Real estate prices in Chilliwack are hitting all-time highs as residential listings are at an all-time low. (Greg Laychak/Black Press file)

High Chilliwack home prices, sales forecast to moderate

2018 sales should be lower than 2017 and 2016, which was the hottest year on record

As house prices rise and supply dwindles, a cooling may be on the horizon thanks to mortgage changes in the new year.

The B.C. Real Estate Association’s (BCREA) fourth quarter housing forecast calls for a drop in sales for 2018 in the Chilliwack and District Real Estate Board (CADREB) along with just a 4.3 per cent increase in price.

Provincewide, the BCREA forecast calls for an 8.8 per cent decrease in sales by the end of 2017 and a further 10.4 per cent drop in 2018.

• READ MORE: Chilliwack real estate sales and prices remain hot

For CADREB, the BCREA forecasts a 13.1 per cent drop in sales below the record 4,306 in 2016.

“Housing demand across the province will face increasing headwinds in 2018,” according to Cameron Muir, BCREA’s chief economist. “A rising interest rate environment combined with more stringent mortgage stress tests will reduce household purchasing power and erode housing affordability.”

Muir says the five-year qualifying rate is forecast to rise 20 basis points to 5.15 per cent by the end of 2018. Add that to an estimated 20 per cent decrease in purchasing power thanks to new qualification rules for conventional mortgages means the market should cool.

• RELATED: Chilliwack among top 10 B.C. cities to buy real estate

As for prices, the average price of a home in CADREB area — which includes Chilliwack, Agassiz, Harrison Hot Springs, Hope, Boston Bar and in between — was $397,911 in 2016.

The BCREA forecasts the average MLS price in CADREB to average $469,400 for the entire 2017 up 18 per cent, the highest increase of the 11 real estate boards in the province.

That compares to the average sale price last month locally of $484,753. With a BCREA forecast average sale price in 2018 of $489,900, that would require a stability in the local market unprecedented over the last decade.

Indeed, BCREA forecast just a 4.3 per cent price increase year-over-year, close to the B.C.-wide prediction of 4.6 per cent from $712,300 in 2017 to $745,300 for 2018.

And while the fewer sales for 2017 and 2018 are just that, fewer sales, these numbers will still be the second and third highest years on record.

What analysts will be paying particular attention to in 2018 is the much-needed increase in supply. Supply is at near decade lows, which, coupled with increasing demand has led to the rapid rise in home prices.

BCREA says the combination of new demand coming on line along with decreased consumer demand due to the new rules should make for a more balanced market in 2018.


Like us on Facebook and follow us on Twitter.

Just Posted

Chilliwack RCMP seek ID of man caught by bait car camera

Police say man is wanted for identity theft connected to incident downtown on Feb. 5

Chilliwack court to decide on allowing assistance dog to sit with sex assault witness

Yellow lab Caber helps calm people in crisis, in police interviews and in courthouse appearances

Chilliwack Special Olympics launches into spring season

Bocce ball, soccer, softball and golf highlight the offerings for 87-plus local athletes.

Rupert the Bunny sidelined due to deadly virus outbreak

Chilliwack’s famous therapy rabbit quarantined for his own safety, people not at risk

Auditors couldn’t tell if Fraser Health executives bought booze on taxpayers’ dime

Review from 2014 says one administrator bought Bose headphones on company credit card

Local rock hound carves a 9-tonne granite grizzly bear

Chilliwack’s Paul McCarl’s about to complete a carving project 14 years in the making

Lower Mainland rabbits confirmed killed by highly-infectious virus

Feral colony on Annacis Island in Delta died from hemorrhagic disease. Pet rabbits could be at risk

B.C. Scientists witness first-ever documented killer whale infanticide

“It’s horrifying and fascinating at the same time.”

Okanagan Falls winery showing international photo project

Liquidity Wines will be sole Canadian show of National Geographic’s Photo Ark

Lawyer for one suspect in beating of man with autism says he’s not guilty

Ronjot Singh Dhami will turn himself in, lawyer said

Liberals awarded $100,000 contract to man at centre of Facebook data controversy

Christopher Wylie says his voter-profiling company collected private information from 50 million Facebook users

Facebook’s Zuckerberg admits mistakes in privacy scandal

Zuckerberg admits to privacy scandal involving a Trump-connected data-mining firm, but no apology

Online threat to U.S. high school traced to Canadian teen

A 14-year-old girl has been charged in connection with an online threat against a high school

Vaping device overheats, burns down home on Vancouver Island

Nanaimo Fire Rescue says units could cause fires in other homes and even aircraft

Most Read