It comes from a Romany word, ‘chavi’ which means child and this is quite a well established etymology and it happened in the south east of England that this was borrowed into English and it’s sort of spread from there via the internet and the media.
In 2004 it entered the Oxford English Dictionary as the first ever Word of the Year and was heavily promoted as such and that led to quite a lot of media coverage of the word and an increase in use in sort of the mainstream media, although it had been bubbling away on the internet and in people’s speech for a while.
There are various sorts of false etymologies, false stories about where the word comes from, the most famous of these, is to say that it’s an acronym of ‘Council House and Violent’.
And what this shows is that people are reading a meaning into the word and they go back and they make a story up where they think the word’s come from based on what they think the word means or how people are using the word and what this false etymology shows really is that it has these sort of class-related meanings.
So they’ve reinterpreted it as meaning something to do with council housing and violence it’s used in the demonization of the working class, especially young working class people as if they constitute some sort of underclass distinct from the rest of us non-chavs.