What goes up must come down.
The Chilliwack real estate market, which was red hot throughout 2020 and 2021, fell like a rock in 2022.
Interest rate hikes and more inventory conspired to slow sales and bring prices down in the Chilliwack and District Real Estate Board (CADREB region), which encompasses an area from Yarrow to Boston Bar.
In January the average value of a single family home was $1,098,710 and one month later it would hit an all-time high of $1,118,254, according to CADREB numbers. But prices dipped in six of the next nine months, and by the end of November it was down to $861,009, representing a 23 per cent drop.
The average value of all homes in Chilliwack, including townhouses and condominiums, dropped to $649,006 in November from an all-time high of $907,385 in January, representing a 28.5 per cent decrease.
While those homes were flying off the market almost as soon as they were listed at the start of the year, by November they were taking an average of 44 days.
The inventory increase was real. Available units bottomed out at 264 in December, 2021 but rose sharply throughout 2022, topping out at 1,295 in July. There were 1,014 listings on the market at the end of November.
The 2022 one-month low of 133 sales happened in June, representing an 80.5 per cent drop from the all-time one-month high of 681 set in March of 2021.
The interest rate hike was also real. The Bank of Canada announced a 0.5 per cent hike on Dec. 7. The seventh increase of the year brought the interest rate to 4.25 per cent, which is the highest in the country since early 2008. The interest rate rose rapidly, as it was only 0.25 per cent in March.
Most forecasts predict the interest rate to remain steady or drop very slightly in 2023 before declining in a more significant way in 2024.