A local resident doesn’t like what he’s seeing with the Yukon government’s new approach to selling residential lots in the city.

The resident wishes to remain anonymous because of his position in the community.

Selling three single-family lots to the highest bidder with a minimum bid price could drive up the cost of residential land even further, he told the Star this week.

In one case, he points out, the government has set the minimum bid for an unserviced infill lot in Granger at $249,000.

Who knows, he asked, what it will go for, other than to the highest bid?

He pointed out the lot is not serviced with water and sewer lines.

That means the new owner will have to dig into the street pavement to hook up the water and sewer mains at a cost likely to exceed $30,000.

The owner will also have to bring in the power, and communications, he said.

He said he knows of friends who were interested in the lot – but have pulled back because they simply can’t afford the high costs involved.

“Typically, they have always done a lottery process for the lots,” he said.

He said he understands the price of land is going up, but the government here should be doing what it can to hold down escalating prices – not inflating them with bidding contests.

Marc Perreault, the president of the Yukon Real Estate Association, said he was not able to comment this morning because he didn’t know the government is using a bid process instead of a lottery, but he was surprised.

Selling residential land to the highest bidder can drive up the price of land overall, he said.

Coun. Samson Hartland told the Star he was not aware of the Yukon government’s decision to use a bidding process to sell five of seven infill lots.

The city continues to struggle with providing affordable housing, he pointed out. Selling residential land to the highest bidder runs contrary to keeping the price of land within reach, he said.

Hartland said it could be argued a bid process is appropriate for the larger, five-hectare lot in Hidden Valley that has an upset price of $1,029,000.

There is the potential for developers to be innovative with subdivision plans and so forth that make it more of a commercial venture, he suggested.

But selling the three single-family lots to the highest bidder does not meet the same test, Hartland said.

Colin McDowell, director of the land management branch, said the decision to use a bid process for the three urban residential lots was to establish a pilot project to see the response from the private sector and local contractors.

All three lots, he pointed out, are large enough to support more than just a single-family home; they are large enough for duplexes or even triplexes.

The government has used a bid process in the past to sell commercial and multi-residential lots, he pointed out.

He said a bid process is commonly used to sell residential properties down south.

Staff with both his Department of Energy, Mines and Resources and Community Services decided it was the right step to implement a pilot program to test the private sector development capacity in Whitehorse, McDowell said.

He said the market value for each lot was established by a professional appraiser.

Mike Gau, the city’s director of development services, said today city staff were aware the government was contemplating using a bid process to sell the land.

The tender for five of the infill lots and the lottery for two country residential lots will close Tuesday.

The seven lots are as follows:

• The Granger lot at 119 Wilson Drive is 1,160 square metres, or 12,486 square feet, and is unserviced.

The minimum bid price is $249,000 before the GST, with a requirement to build in three years. By comparison, the largest of the Whistle Bend properties were 912 square metres, or 9,817 square feet, and sold for $194,649 before the GST;

• The Porter Creek lot at 42 14th Ave. is 1,580 square metres, or 17,000 square feet, and is unserviced. The minimum bid price is $227,000, with a three-year build requirement;

• The Porter Creek lot at 67 Wann Rd. is 2,480 square metres, or 26,695 square feet, and is unserviced. The minimum bid price is $249,000, with a three-year build requirement;

• The Logan lot at 6 Finch Cres. is 3,860 square metres, or 41,550 square feet, and is unserviced. The minimum bid is $911,000;

• The Hidden Valley lot at 48 Couch Rd. is five hectares, with a minimum bid price of $1.03 million;

• The Cowley Creek country residential lot at 55 Salmon Trail is 1.03 hectares. It is being sold through a lottery for a price of $209,000.

• The Cowley Creek lot at 59 Salmon Trail is 1.05 hectares. It is being sold through a lottery for a price of $212,000.