The Chilliwack real estate market joined the broader provincial housing boom over the last year, posting enormous gains in sales and prices. Be it historically low interest rates or strengthening fundamentals, the Chilliwack housing market is on fire – and it could remain that way for the rest of the year, much to the chagrin of first-time homebuyers who may have missed out on the temporary COVID discount.
This is the same trend unfolding within real estate markets throughout British Columbia. From Vancouver to Victoria to Vancouver Island, multiple municipalities have been posting record-setting growth throughout the coronavirus pandemic. For many locations, it comes down to the simple fact that demand is outpacing supply. Many cities – and not just on the west coast – were not prepared for the onslaught of demand for locations possessing minimal inventories.
As a result, the Chilliwack real estate market is reporting eye-popping numbers.
Chilliwack Real Estate Market sees Red Hot Gains in 2021
According to the Chilliwack & District Real Estate Board, residential sales spiked 183.5 per cent year-over-year in February, posting a new all-time sales record for the month of February. Also, in the first two months of 2021, home transactions soared 145.7 per cent from the same time a year ago, with 865 units being sold.
Home prices edged higher, too. The MLS® Home Price Index (HPI), which is considered to be more accurate than average or median price measurements, highlighted that real estate valuations advanced at an annualised rate of 16.1 per cent. The year-to-date average price, meanwhile, gained 21.4 per cent to $660,171.
Here is a year-over-year breakdown of how the different property types performed in February:
- Single-Family: +19.5% to $704,600
- Townhouse: +16.5% to $497,200
- Apartment: +5.5% to $303,700
But how is this all this heated activity possible when February is historically a quiet month? This surprised Andrew Verschuur, President of the Chilliwack and District Real Estate Board.
“Setting a new February record is one thing, but what’s really astonishing is that February managed to reach the second highest level of sales for any month in history, coming in just seven sales below the all-time record from June 2016 in a month that is otherwise typically very quiet compared to the rest of the year,” said Verschuur in a news release.
Chilliwack real estate conditions continue to be tight, but they did ease modestly in February. The number of new listings jumped 46 per cent to 587, while active residential listings tumbled 44.3 per cent to a three-decade-low of 500. Months of inventory clocked in at 0.9 at the end of February, under the 4.8 months level in the previous year, and below the long-run average of 5.7 months
“Part of the reason sales jumped to such unexpected highs was a very welcome surge in new listings returning to the market. This helped to keep the market balance from accelerating further into seller’s territory for the time being, although conditions remain the tightest in history. Unsurprisingly, price gains continued their double-digit climb,” Verschuur added.
Valuations have spiked, too. In February 2020, the value of units sold was $103 million. A year later, the dollar value of all homes sold was $361.1 million. This represents a 253 per cent increase.
Chilliwack: A Seller’s Market in 2021?
The Chilliwack real estate sector has been a seller’s market for the last year, much like other areas in the British Columbia real estate market, due to tight inventories and persisting demand. But while new listings might offer a bit of a reprieve, the increase in the number of housing starts and completions could act as a respite to gently soften tightening conditions.
According to the Canada Mortgage and Housing Corporation (CMHC), housing starts and completions have increased substantially from a year ago within the Chilliwack community:
- Housing Starts: +136% to 163
- Completions: +33% to 44
- Total Absorptions: 0% at 53
And this has been the trend provincewide, with the broader housing sector jumping 35.41 per cent year-over-year to 25,430 in January.
The British Columbia Housing Boom
It is not only Chilliwack that is witnessing a housing boom. The entire province of British Columbia is experiencing sky-high sales activity and real estate valuations. It is a full-blown seller’s market. The British Columbia Real Estate Association (BCREA) reported in February that prices moved at a “blistering pace” of 89 per cent and residential sales gained 63.3 per cent. With interest rates at historic lows and demand outpacing supply, homebuyers will be forced to continue to shift their property budgets higher (and be prepared to put up a fight in a bidding war). A rate hike or a surge in supply could be the only mechanisms to ease home prices across the province.