It’s hard to resist a good gab about the price of real estate in the Yukon.
The growth in the past five years has been nothing short of phenomenal. Prices have nearly doubled and overall sales have gone nowhere but up.
But the latest figures from the Yukon Bureau of Statistics hint that, just maybe, the housing party – at least for sellers – may be coming to an end.
For buyers, on the other hand, it may have just begun.
The barometer: the price of a single-family house in Whitehorse (condos, duplexes, trailers not included.)
After reaching a whopping high of $455,700 in the third quarter of 2011, that price has started to retreat.
Between October and December, it dropped $23,100 or 5.1 per cent to $432,600.
That’s still higher than the same period in 2010 when it was $404,800 and considerably more than the $226,000 it was in 2005.
If you bought a place or two back then, or earlier, you’re probably congratulating yourself on your impeccable timing or good karma or some combination thereof.
And if you’ve been thinking of selling, you’ve probably been biding your time for just a bit longer to see if you can’t squeeze another $10,000 or $20,000 or maybe even $40,000 out of some unsuspecting buyer.
If you’ve been sitting on the sidelines, waiting to buy your first home, you’ve been praying for prices to peak or plateau. Maybe even plunge.
But whether this recent drop in Yukon prices is simply a blip or the beginning of a downward trend depends on who you want to believe.
A recent issue of Canadian Business magazine paints a bleak picture of real estate nationally – a perfect storm where strong demand has pushed housing prices up faster than wages. Throw in record levels of personal debt and the powerful, self-perpetuating forces of greed and fear, and it says that not even low interest rates will be able to save the housing market from taking a dive in 2012.
But don’t despair, it concludes: “A house is firstly a place to live, not an investment. Bubbles occur, in part, because we forget that distinction. So buyers need to be comfortable knowing their houses might not increase in value over the next few years – and also that they could be worth much less.”
The Canada Mortgage and Housing Corporation takes a sunnier view.
It expects house prices to keep on climbing, albeit moderately, for the next two years.
In the Yukon, 2012 seems poised to be the year that supply finally catches up with demand.
Thanks to the Whistle Bend subdivision and other housing developments in the works, there should soon be plenty of homes for all who want one.
And if prices continue to slide, those new homes may even be affordable.