Home page

Text size

E-mail this page

SOMBA K'E/YELLOWKNIFE
The average price of NWT homes went up 26.5 per cent last year, according to the Canadian Real Estate Association.

An interactive map on the association's webpage indicates the average price for a home in the territory rose to $466,333 in 2012 from $368,543 in 2011.

However Yellowknife Real Estate Board president Ken Pearman is not convinced the national numbers are an indication of a skyrocketing housing market in Yellowknife, but instead said they were likely skewed by a few purchases with big price tags.

Also, the Canadian Real Estate Association takes into account the entire territory and not solely Yellowknife.

"We have a very small market," said Pearman. "If we sell four or five bigger houses at $680,000, and if we sold two or three less mobile homes in the $300,000 range, it could look like we have a 26-per-cent gain when that isn't true. We don't have tens of thousands of houses to base the market on.

"So you can get the numbers skewed."

Regine Durand, a market analyst for the Canadian Mortgage Housing Corporation, echoed Pearman's observations.

According to Durand, real estate prices in Yellowknife went up 3.4 per cent between 2011 and 2012, which is actually less than the five-year average of seven per cent per year.

"Actually last year we had half of the price growth of the five-year average, compared to the previous five years," she said. "But, of course, that's still growth."

Durand said the 3.4-per-cent price increase was namely due to an increase in the sale of homes with high price tags. In 2012, 39 per cent of sales were valued at $400,000 or more whereas in 2011 only 32 per cent of sales were for more than $400,000.

Pearman, who has worked in real estate in Yellowknife for almost 30 years, said prices in Yellowknife have been steady between 2011 and 2012 "with a slight uptick." The market should be about the same heading into 2013, he said.

Pearman said he doesn't expect upcoming projects to affect the steady trend all that much.

He said the largest residential development in the pipeline at the moment is a Homes North mobile home subdivision, which is expected to reach a total of 315 units.

Pearman said a mobile home development allows the developer to put units on the market as they are ready for occupancy.

This contrasts from the construction of condominiums because, once they are built, they are on the market and need to be sold as soon as possible for the developer to realize a return on investment.

As a result, the trend will likely remain steadily optimistic, said Pearman.

"If the cost of construction goes up, the resales will probably follow that," he said. "I don't see anything on the horizon that is going to say that this market is going to crater.

"Similarly I don't see anything on the horizon that says this market is going to go bananas."

Durand also predicted a steady but undramatic increase in Yellowknife housing prices.

She explained that demand still surpasses supply in the city, with new listings in Yellowknife up only eight per cent while sales were up 32 per cent in 2012.

These statistics are particularly notable when compared to the five-year average for sales growth, which was at minus 2.5 per cent.

National average real estate prices

Source: Canadian Real Estate Association

We welcome your opinions. Click here to e-mail a letter to the editor.