Real estate sales in the Chilliwack and District Real Estate Board (CADREB) area were down 29 per cent in 2018 compared to 2017.
With 2,829 residential sales in the region – which includes Chilliwack, Cultus Lake, Harrison Hot Springs, Agassiz, Hope and the rural areas in between – that’s down more than 1,000 from the 3,983 sales in 2017.
As local Realtors move into the new year, they say 2018 will be remembered as the year of the “stress test.”
After the first and second biggest years ever for local real estate, 2016 and 2017 respectively, it was last January 2018 that tougher mortgage qualification rules came into effect aimed at cooling the large and overheated markets in Vancouver and Toronto.
Those rules, introduced by the federal banking regulator, were intended to ensure those qualifying for a mortgage could still afford that mortgage if interest rates increased.
“Hardest hit were first-time buyers, who found themselves qualifying to borrow approximately 20 per cent less that was available to them before,” according to a CADREB press release. “It also had a significant effect on ‘move-up’ buyers, and the impact was particularly felt in the typically slower months of housing sales in Chilliwack and area.”
December 2018 was the slowest month of the year with just 118 sales compared to 204 in December 2017.
And while sales are down, prices remain steady. While the average price of a home sold in December was just $485,349, the average sale price of all homes for 2018 was $516,843.
Assessed values of Chilliwack residential properties are also up, 13 per cent across the city. That’s 10 per cent for single family homes and 23 per cent for stratas.
“We experienced a noticeable lull in December,” said CADREB president Lori Maier. “Last month saw a 42 per cent decrease in sales, compared to a record December of last year when people were getting into homes before the new regulations came into effect.”
While the stress test for mortgages will remain in effect, Maier said CADREB believes indicators point to a balanced market in the coming months.
“All of the economic markets, not just real estate, are feeling economic changes,” she said. “Overall, the pressure on mortgage rates has had less effect due to decreased markets, and with little change locally in median house prices, all indicators point to a solid balanced market in early spring.”