Yellowknife ‘should expect 1,000 new households in next decade’

Yellowknife should be preparing to house an extra 1,060 households by 2035, a new housing study states, calling for the construction of hundreds more two, three and four-bed units.

Urban Systems, the consultants who led the study, told the city to find a balance – in meeting that goal – between filling in vacant lots with apartments and developing single-family detached housing in new spaces.

Jake Papineau, presenting Urban Systems’ initial findings to Yellowknife’s city council on Tuesday, said infill development makes sense when the municipality already controls downtown land but other areas are still controlled by the NWT government.

The GNWT and city are entangled in a protracted negotiation to have the territory hand over administrative control of more land within the municipal boundary. In the meantime, a lack of developable land was identified by the consultants as a key barrier to getting more housing built.

“If we’re talking about 1,000 or 1,500 units, if you develop those lots that have infill, you might be able to hit that unit number,” Papineau said.

“But as far as the overall feel and fabric of the community, there might be some elements that get … not necessarily focused on in the same level. So it’s really about maintaining a balanced approach, so that whatever type of unit somebody would like to live in, in Yellowknife, there’s an opportunity for them.”

Papineau said the consultants estimate Yellowknife’s population will be 22,400 by 2035, a projection based on various sets of territorial and federal data. The extent to which the fluctuation of jobs in the area is included – the growth of the Giant Mine remediation project, for example, or the closure of the Diavik diamond mine – isn’t clear.

Urban Systems says the move to a population of 22,400 would mean 1,060 new households making Yellowknife home.

He translated that to an anticipated demand for 193 new studio or one-bedroom units, 263 two-bedroom units, 473 three-bedroom units and 174 units of four or more bedrooms.

That’s based on 2023 data, meaning buildings currently close to completion – like several properties being built by developer Milan Mrdjenovich, or the refurbishment of the downtown former Bellanca office building into apartments – are not factored in and will contribute toward reducing the number of units needed.

Urban Systems said it spoke with builders, developers, businesses and 23 community organizations to draw up its housing needs assessment.

Overall, Papineau said most people “love living in Yellowknife,” feel connected to their community and “there’s a lot of appetite to make change happen,” but the people in a position to create new housing are uncertain about the environment they’re building in.

“Lack of available developable land was identified pretty-much ubiquitously. At that time, there were no residential housing lots available for development. From a builder’s perspective, not knowing where they’re potentially going to be building next year makes them more hesitant to make investments,” Papineau told council.

“While infill development is viewed as an important step, a lot of the builders and developers that we spoke to mentioned that there still needs to be some element of greenfield development specifically to address market gaps that they perceive as being those single detached homes.

“A lot of the groups that we spoke to are just kind-of unsure what the future looks like based on a lack of land availability and the overall magnitude of affordability challenges.”

Yellowknife’s current housing situation

Many of the observations in Urban Systems’ summary will sound familiar to Yellowknifers.

There are just over 7,500 households in Yellowknife, with an average of 2.7 people per home.

The consultants found that a “very high percentage” of households in the city are renting – 44 percent, compared to a Canadian high of 54 percent in Vancouver and a lower figure of 32 percent in Calgary. The Yellowknife figure is “pretty significant,” Papineau said.

The average sale price for a single-family home in Yellowknife was $624,000 according to the most recent sales data, a slight drop from $652,000 over the year to date, the consultants reported, though they cautioned that prices can readily fluctuate in a small city depending on the type of home reaching the market and other factors.

Roughly one in 10 Yellowknife households is in “core housing need,” Urban Systems reported, meaning a household either spending more than 30 percent of its income on housing, living in a unit that requires major repairs, or living in a unit without enough bedrooms. In Yellowknife’s case, most households in core housing need are struggling to afford the home they have.

The “concentrated ownership group” controlling most Yellowknife rental properties – Northview is the dominant landlord in the city – means rents “stay frustratingly high” and there’s little incentive to revitalize and reinvest in rental units, Urban Systems said it had heard.

“It’s a pretty tenuous housing situation for some folks,” Papineau said.

Data problems

The consultants said some of the federally available data doesn’t appear to match the reality in Yellowknife, which complicates the picture they can provide.

Data from the Canada Mortgage and Housing Corporation, for example, suggests that Yellowknife’s vacancy rate in 2023 was 3.4 percent, but Urban Systems said it had “consistently heard” from locals that the real rate is lower.

CMHC data suggested an average rent of $1,300 a month for a bachelor unit or $2,250 for a three-bed, Papineau said, which again the consultants had heard “might not actually be the reality in the community.”

“I’m really excited to hear that there’s some caution with the data,” councillor Rob Warburton responded, “because from our experience, those are rents are way higher and vacancy is closer to zero.”

Warburton said flagging the data concern is important because banks and other levels of government rely on CMHC data when making decisions.

“We need to do, as a council, some lobbying work to make sure this is captured accurately, because it is hurting everything,” he said.

The consultants said they had been “unable to connect directly” with Indigenous groups or representatives, leading to another gap in the data. The city said it will try to help Urban Systems make that connection before the report is finalized.

What happens next

The final report is expected by the end of 2024. The study was launched after Yellowknife received $8.4 million from a federal housing accelerator fund earlier this year.

Charlsey White, the city’s director of planning and development, said the housing needs assessment will be used to “help support us in our conversations with the GNWT” about land Yellowknife needs for housing. It’ll also be used to help lobbying efforts with the federal government.

“It really supports our argument and our point that more land is required for the City of Yellowknife,” White said on Tuesday.

Councillor Steve Payne said the report ultimately highlighted that the city was now playing catch-up to make land available, and the problem should have been solved far earlier.

“Every term, we talk about how we need more land and how we’re going to do different things to get more land,” Payne said.

“For lack of a better phrase – and I’m always one to give out different phrases – I really feel that we’ve shit the bed on getting land to market.”

Papineau cautioned that the 2035 population projection is the consultants’ best estimate but he had “never encountered a population projection that gets it right” in his career.

“There’s a lot of variables that can change. Interest rates could bottom out. You could get new development that comes in and brings 10,000 new units to market, and then all of a sudden everybody realizes, ‘Hey, I can afford to live in Yellowknife.’ Those things can change very, very quickly,” he said.

“I feel that Yellowknife is also in a unique situation. Housing is such a constraint that it might actually be something that’s limiting population growth.

“If supply were to come online, it’s possible that population growth could greatly exceed what’s projected.”