Yellowknifer asked real estate agencies about the housing market in Yellowknife and their predictions of the direction it will move in the coming months and years.
Adrian Bell, owner and broker for Century 21 Prospect Realty; Kim Knutson, owner and broker for RE/MAX North of 60 Realty; and Rod Stirling, broker and owner of Coldwell Banker Northern Bestsellers, all provided input.
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What is the state of the housing market right now in Yellowknife?
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Adrian Bell
“The Yellowknife market has slowed down considerably this fall, which is consistent with what we’re seeing right across the country. Since the beginning of August we’re down 29 per cent in listings sold compared to a year ago. But what’s interesting to me is that the number of homes coming to market — the number of new listings — is down slightly more than the number of sales.
“It’s not so much a case of homes being listed for sale but not selling. They are selling. People are just taking a bit of a breather before putting their homes on the market, likely waiting for the spring rush to give themselves the best possible chance of maximizing their sale price.”
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Kim Knutson
“The housing market is ‘seasonably slow.’ Typically from November to the end of February the market slows right down.”
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Rod Stirling
“Like the weather, the market has cooled somewhat. That coupled with the higher mortgage rates has some people sitting on the sidelines and doing a ‘wait and see’ type of approach with the market. Though the effect on our market as far as average price, days on market, the amount of (listings) has not had the dramatic swings they are experiencing in larger southern markets.”
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What happens to the housing market in Yellowknife when the Diavik mine closes in a few years?
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Adrian Bell
“It’s hard to predict exactly what will happen, but I think it’s safe to say that there will be a lot more listings on the market for a period of time. We know there were 350 Yellowknifers employed at Diavik in 2020. Some of those folks will find other work locally, some may retire and stay put, but many will not.
“We have already seen a small number of Diavik employees make the move early, rather than waiting for a possible glut of listings to hit the market. I was surprised to see this start to happen so far out from mine closure, but it is happening. It’s possible that those jobs are not being backfilled — that would be a question for the folks at Diavik. If that were to happen, we might have a more gradual increase in listings over a longer period of time. That would be better for people’s property values.
“What is also hard to predict is how other projects like the Giant mine remediation project will offset Diavik’s impact on the real estate market. I believe Giant will employ 260 people at its peak. But I don’t think the peak will coincide with the 2025 closure, I believe it comes later. And I also suspect that more of the Giant employees will be renters as opposed to homeowners. Will there be other significant projects that come along and help ease the pain? It’s not impossible, but I’m not counting on it.”
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Rod Stirling
“That is a hard one to predict three years out. Sure they are a big employer and spend a lot of money in the North, but it is not as though someone turns out the lights and shuts the doors and everyone leaves come 2025. There will be employment in doing all the shutdown and reclamation for years after they shut down, but certainly not at the current employment levels.
“At the same time, there is a huge project for the reclamation and clean up at Giant mine and hopefully there will be new mines that are able to start up in the NWT between now and 2025 to offset the effects of the Diavik shut down.”
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Are housing prices going up or down?
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Adrian Bell
“It’s too early to say with any certainty. The median average sale price this fall is down by four per cent, but it’s hard to tell if that’s a real number or just a result of a different ‘sales mix’ - i.e. smaller homes coming to market. We don’t have the kind of data here that you would need to make that assessment.
“Personally, I think we’ll see prices plateau for a while rather than going either up or down. A lot of listings will be priced similar to last year, but then if they sit on the market for longer and longer, prices will start to dip.
“We’re seeing the first hints of that, with average days on market rising from 40 to 45 this fall. We’ll have to see if that trend continues.”
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Kim Knutson
“In general, the lower-end market is holding steady and we are finding the higher-priced homes are taking longer to sell and prices are coming down a bit. Currently there are five properties over $1 million on the market. It’s hard for vendors sometimes to realize we are not in the same crazy market as this past year and often they want the more aggressive prices. We are seeing a lot more price reductions.”
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Rod Stirling
“Although the listing inventory is down from a banner year of last year, the prices on resale properties has gone up. Again a sharp contrast to what is happening in larger southern markets.”
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What kind of spring season are you expecting?
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Adrian Bell
“The federal government is working very hard at taming inflation, and housing prices are a big piece of the puzzle. I have no doubt they will succeed and it will impact markets right across the country. But we are fortunate here in that home prices didn’t rise as high as the rest of the country over the last couple years, so we don’t have that far to fall to return to ‘normal.’
“I also think that, given how transient Yellowknife is, there will be no shortage of eager buyers looking to move here to take the jobs and buy the homes that are made available. Sellers will have to price their homes more competitively, and they will be more reliant on professional help than they tend to be during hot markets, but I still expect it to be a very busy spring and a healthy, more balanced market.”
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Kim Knutson
“Its always hard to predict but we see no reason we won’t see a robust market, likely a more balanced market with not as many multiple offers. We have a large military presence in Yellowknife and they really fuel the market. Also there are still a lot of buyers out there, just not the right properties, or people have decided to hunker down for the winter.”
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Rod Stirling
“Busy, I hope, locally with the project at Giant, a new aquatic centre, the Avens Centre expansion, some local multi-family rental construction and possibly a new DND project on the horizon. I expect that the market will remain busy.
“Try and find a rental property right now with zero per cent vacancy and rising rents. It is good that at least one developer is trying to meet some of this demand but we need much more land identified and developers building to meet the demand as it far outweighs the supply right now.”
“A vacancy rate is always a good economic barometer on a market. Given there is close to zero for rental inventory and a lot of new construction coming, I would say the market will continue to be busy.”
“A lot of people moving or wanting to move north want to be rooted in the community and become homeowners, and there is not a lot of availability in certain housing types in the marketplace. A lot of these folks choose not to move here because of the lack of quality housing. It is quite concerning when a person can find a good job far quicker than they can find good, suitable housing. I think that the city perhaps in concert with the YKDFN (Yellowknives Dene First Nation) and various other stakeholder groups should try and develop a can-do attitude as far as trying to bring on more land and housing options and encourage developers to build here rather than throwing up roadblocks and creating an air of uncertainty and discouragement.”
“We have a good opportunity for some growth and to increase the tax base if everyone tries to work together on trying to solve our housing woes. As the saying goes, ‘If you build it, they will come.’”
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Are there any other details you feel are important that you would like to share?
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Adrian Bell
“It would be really great if the folks at Diavik could provide more details about their closure as it approaches, and more details about how many of their employees are homeowners as opposed to renters. The more information they can provide, the easier it will be for the rest of the community to plan for impacts on their property values.”