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SOMBA K'E/YELLOWKNIFE - The current world financial crisis is having little effect on the Yellowknife real estate market, according to an employee of Coldwell Banker.

"The reality is it hasn't affected us to a large extent yet. We're not really feeling it yet," said Ken Pearman, sales associate for the Yellowknife firm. "I spoke to several banks. There's plenty of mortgage funds to go around. Interest rates are stable."

Ken Pearman, senior sales associate at Coldwell Banker, said the Yellowknife housing market has been affected very little by the current economic slowdown in Canada and the U.S. - Guy Quenneville/NNSL photo

The economic slowdown has actually produced a boom for home buyers.

"One positive thing is that fuel prices have come down," said Pearman. "It's like 70 (dollars) a barrel - half of what it was. Our heat costs will be lower."

Which is good, he said, considering the growing number of his clients who bring up heating costs when talking to him about buying.

"We see a lot more people budgeting and putting in wood pellet stoves," he said.

But there is potential for the economy to have an adverse effect in the future, Pearman added.

"Down the road we might (see an effect) if people start to want to take money out of their RRSPs for their down payment."

Coldwell Banker has actually generated more sales revenue so far this year compared to this time last year and is easily on track to do even better next year in total annual sales revenue. Pearman could not reveal specific figures.

While the company's website has a new section devoted to houses whose prices have been lowered, there were only four listed on Monday. For the most part, prices for homes have remained stable, said Pearman.

"We don't see a real deterioration in the prices. Maybe a little bit in the high-end homes. Anything above $550,000 may take a little bit longer to sell. People might be a little more cautious. 'Do we need a bigger house?'"

What worries Pearman more, he said, is the possibility of the GNWT instituting new taxes in the territory, such as a beefed-up sales tax or a five per cent hotel tax.

"That's the absolutely worst thing they can do," said Pearman. "The best thing they can do is drop income tax in half, stimulate the economy and get people working, get more employment and create a tax base that way.

"It's already expensive enough here."

As for who is actually buying homes in Yellowknife right now, it's a wide cross-section, according to Pearman.

"We have a lot of military people buying. We have the mining sector. We have accountants. We have some doctors coming in. It's really all over the map. Our strongest segment is probably our more entry-level homes like our condos and town homes."

Richard Goatcher, senior market analyst with the Canada Mortgage and Housing Corporation (CMHC), echoed Pearman's thoughts about the Yellowknife housing market.

The CMHC recently compiled statistics on sales listings from July to September, which were not available as of press time.

"It seemed to me that overall the market balance hadn't shifted that much in terms of the relationship from sales to listings," he said. "The rate of price growth has slowed down a bit. But it's still positive; prices aren't falling."