Councillor accuses builders of hoarding lots

Today the territory has no residential lots for sale in Whitehorse. But that doesn’t mean it’s impossible to buy a new house on a newly…

Today the territory has no residential lots for sale in Whitehorse.

But that doesn’t mean it’s impossible to buy a new house on a newly staked lot.

Just ask a builder.

A few builders have bought up too many city lots and they’re turning them over for big profits because of the municipality’s lack of available land, said councillor Doug Graham.

“These properties have been taken off the market by builders and they’re being held by them, which was fine when there were lots available in the city, but now there aren’t,” said Graham.

“It’s artificially forcing up the prices of everything because people moving into the city can’t buy lots so they either go to a builder or they force the prices of housing up somewhere else.”

Under the lands branch’s builders’ residential lot sale policy, construction companies can buy up to a maximum of 20 lots.

The policy was drafted to “facilitate purchase of multiple lots by building contractors for development and resale,” and to allow builders to meet the high demand for housing in the territory.

But a few individuals are taking advantage of the system by setting up shell companies and holding 35 or 40 lots at once, said Graham.

There is no government legislation against one person buying lots under two different companies, said Bryony McIntyre, lands client services manager in Yukon’s Resources department.

“They’re not breaking any laws; people can incorporate themselves any way they wish as long they’re meeting the rules and regulations of corporate services and the rules of the country.”

But Graham says the fault lies with the Yukon government and its process for land disposition.

Allowing builders to hold 20 lots is too many, he said.

“They’re allowing some builders to buy too many; there are very few of them who are screwing the system up for everybody else,” said Graham.

“I know it’s happening up there, all you have to do is drive around Copper Ridge and see how many lots are sitting there empty.”

Currently 13 contractors hold 55 lots in the Copper Ridge area and they’re all meeting their requirement to build, said Yukon Housing Corporation spokesperson Doug Caldwell.

“Nobody’s sitting on a lot; they’re all active.”

Under the territory’s current land-disposition process, the lots are first offered for sale by public lottery.

Then builders get a crack at the remaining lots; each can buy a maximum of 20 and they must pony up a 20-per-cent down payment.

On the first lot purchased builders have a five-year agreement of sale with two years to build, but on all other lots (two to 20) they have one year to build and one year to pay the outstanding balance.

Any lots left over are then put up for sale at the lands branch office.

In September, 106 residential lots in Copper Ridge, south of Winze Lane, are slated to come up for sale.

And now the territory is taking a proactive approach to dole out those lots so there will be enough for builders and for the general public, said McIntyre.

The builders’ lot policy states that lands branch may limit the number of lots a builder can buy to ensure a plentiful supply for sale to the general public.

And that’s just what the lands branch may do.

Government reps have scheduled a meeting with builders and city planners on July 19  to strike a delicate balance — to keep the builders in the black while ensuring there are lots available for the general public.

“This allows us some control over the builders buying lots in a bunch,” said McIntyre.

“That allows the builders to have a selection of lots without stampeding our counter at 8:30 a.m. on the day that they’re available over the counter.

“We want to look at retaining some inventory for the public after the lottery for the next building season in 2007, and what’s the best way we can do that while meeting the needs of the builders,” said McIntyre.

“We want to have those decisions made and communicated to the building community before we have the public offering in the fall.

“If we had 1,000 properties this wouldn’t be an issue,” she said. But because there’s a limited amount of land available the department has to be proactive.

In the past this hasn’t been a problem because there were more than enough lots to go around.

Country residential lots in Whitehorse Copper subdivision and industrial lots in the Mt. Sima area are also slated to become available in the fall.