Fest Fun

Summer’s on when music lovers pack the sprawling green space steps from where I live, for the Vancouver International Jazz Festival’s annual crescendo. A dozen concerts formed the giant set list at David Lam Park in Yaletown over the weekend. Billed as an international celebration of music, food, and culture, the changing weather conditions this year were as wild as the swirling sounds of Ibraham Electric’s Hammond B3 organ. Among the images below is the stacked brass section of local funk favourites Miami Device.

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Wooden It Be Loverly..

Getting wood dressed is not new. Getting dressed up with wood might be. That’s what a father-son team in Burnaby, B.C. has introduced to the fashion world with designer bow ties. The company’s website offers 10 different styles fashioned from what some might refer to as trim ends guaranteed to make you look trim. Made of reclaimed maple and North American walnut, each bow tie begins as a remnant sourced from a commercial mill in Oregon. Even the packaging materials are repurposed, reports The Georgia Straight here: “The only virgin element is the Swedish teak oil used to hand-seal the wood and bring out the grain in each piece. Thanks to variations in grain and texture, and the occasional knot or burr, no two ties are identical.”

~Sawdust~

The Lumberjack World Championship is reportedly now in full swing south of the border. Log rolling, tree falling, and pole climbing are among the 21 disciplines scheduled to keep the town of Hayward, Wisconsin abuzz over the weekend. The event’s set to heat up with “hot saw” on Saturday, before “couples bucking” come Sunday. According to the website, “over 100 competitors will vie for more than $50,000 in prize money, making this one of the largest purses for a lumberjack competition in the world.”

No doubt some guys in B.C. would consider their lumberjack competitions to be ‘world championships’ also. At the Squamish Days Loggers Sports Festival, the world championship happens July 31-August 4. And in Campbell River, we’re told two lumberjack world championships will be held during the Salmon Festival August 8-10. Here in Vancouver, world champions are crowned twice daily at the Pacific National Exhibition (PNE) in Vancouver August 16-September 1. Timber!!

“Halfway Home”

A fresh chart from Trulia today illustrates how quickly the U.S. housing market is moving back to normal. It reveals improvement in all but one of the five market indicators since Q1. With regard to new construction, Trulia reports “starts are 50% back to normal, up from 45% one quarter ago and 41% one year ago. Multi-unit starts – mostly apartment buildings – are leading the recovery: in 2014 so far, multi-unit starts accounted for 35% of all new home starts, the highest annual level in 40 years. This apartment boom started last year, and last year’s starts are now being completed, which is increasing the supply of apartments for rent.”

MD-235-Housing-Barometer_Q22014

“While the spring selling season was softer than anticipated by us and the investor community, the homebuilding recovery continued its progression at a slow and steady pace. The fundamentals of the homebuilding industry remain strong driven by high affordability levels, favorable monthly payment comparisons to rentals, and overall supply shortages. Demand in most of our markets continues to outpace supply, which is constrained by limited land availability.”
– Stuart Miller, CEO of Lennar Corporation, speaking today

Logs and Blogs

Log exports have long stirred more controversy in B.C. than blog exports. For one thing, there are more regulations imposed on log exports than blog exports in this province. It’s mostly readers who determine acceptable blog reporting in this space.

In today’s Vancouver Sun, an associate professor of economics at Thompson Rivers University in Kamloops argues that many of the rules surrounding log exports impose needless costs on producers and owners. He points to a new study on log export policy for B.C. which concludes that a combination of free trade in logs and the export quota policy now in place yields much larger benefits to B.C. than an outright ban on log exports. In fact, “streamlining the export process, while continuing to restrict exports, will ensure B.C. gains the most value from its forestry resources,” we’re told.

According to the professor, “free trade in logs is a more desirable policy when a global perspective is incorporated.”  In the face of China’s fibre deficit no doubt, he explains that if all log export restrictions were removed as part of an Asia-Pacific trade agreement, concessions of a similar size could be leveraged to the benefit of B.C.

“If the B.C. and federal governments are intent on building a healthy and sustainable forest industry in British Columbia, consideration should be given to streamlining the log export process in the short term while looking to free trade in the long term as negotiations further develop.”
– Joel Wood

On fire..

Six regional wildland fire centres operated by the B.C. Forest Service’s Wildfire Management Branch are reportedly gearing up for the possibility of a busy, destructive fire season ahead. With summer set to arrive tomorrow, forecasters are warning of an unusually hot and dry couple of months across the province.

Located near the geographical centre of B.C., Vanderhoof is aptly referred to as “the heart of it all“. On August 18, 2010, Vanderhoof experienced what experts in the field consider to be the hottest fire ever seen in North America. In one night, the fire travelled 17 kilometres, wiping out 40,000 hectares of working forest. Less than two years later, a presentation by Vanderhoof Mayor Gerry Thiessen was the highlight of the 2013 COFI Convention. Looking out at everyone in attendance, he memorably asked: “The fires are coming – what will the response be?”

When I re-connected with Thiessen earlier this morning, he was concerned that the water basin in Vanderhoof is only 14% of normal for this time of year. But he was also upbeat about proactive measures concerning fire control. According to Thiessen, Vanderhoof, The Kootenays, and an area on Vancouver Island are the focus regions of a “landscape level planning” pilot project initiated by the B.C. Ministry of Forests, Lands, and Natural Resource Operations. As Thiessen explains, back in 2010 patches of unharvested forest contributed to the spread and intensity. The severity of that fire scorched every little seedling in its path. To help contain the spread of future fires, he says strips of forest are presently being harvested. “We’ll never stop the fire from spreading altogether, but this project will stop the intensity. It’s exciting for us as a community.”

Thiessen noted that seven fires like the one back in 2010 would wipe out enough sustainable harvest to shut down Canfor’s Plateau Sawmill for 100 years. “That’s why I’m so passionate about how we harvest on the land base. We need more than just facilitators of the resource – we need stewards,” said Thiessen.

Mystery Money

Property speculation in Vancouver reportedly has a new meaning these days. According to The Economist, it’s “wondering what exactly is driving up prices in the least affordable housing market in North America”. Is the market being fuelled by foreigners? That remains a baffling “mystery” we’re told in the full report. There just “isn’t information” available. No data is kept on foreign investment activity in the city, explains The Economist, echoing the rhetoric of Vancouver’s “condo king” Bob Rennie.

Analyst studies aimed at uncovering patterns, trends that might offer clues, have reportedly included monitoring electricity bills, tracking property assessment mailings, and counting “mainland Chinese-sounding names” on sales records. It’s all a big waste of time according to urban planner Andy Yan, who likens any effort to measure the impact of foreign money on prices to “searching for the Higgs particle”. Says Yan: “Everyone knows it’s there, but it’s proving it that’s the problem. We know it’s not wage growth; and it isn’t the economy here. All we know is that in Vancouver, real estate has been de-coupled from the local economy.”

Economist Benjamin Tal recently called the lack of publicly available information about Canada’s housing market “mind-boggling”. The Globe and Mail reports this morning that in response to demand, the Canada Mortgage and Housing Corporation (CMHC) is now looking to fill research gaps on the Canadian housing market. While foreign investment activity is cited as a possible research gap, we’re reminded in the report that a statistical grasp on foreign money is “challenging”. Meanwhile, CMHC is still “trying to find the biggest gaps and the highest priority areas to focus on,” says CEO Evan Siddall. We won’t hold our breath.

“The steadiness is evidence..”

On the face of it, this morning’s U.S. housing starts and permits report appears disappointing. However, a more encouraging picture emerges from a nuanced National Association of Home Builders (NAHB) blog post here. The NAHB notes that the driver behind the declines was multifamily apartment construction (down 7.6%), while “steady” single-family data is indicative of a gradual recovery that’s on track: “Single-family permits were up 3.7% to 619,000 (seasonally-adjusted annual rate), the highest since November 2013 and roughly equivalent to the output for all of 2013.” The NAHB attributes a 5.9% decline in single-family starts to a combination of factors including:

  • cautious/conservative behaviour of homebuilders that persists after a six year decline in housing production
  • low supply of developed lots
  • labour/construction crew constraints
  • supply chain difficulties which have caused builders to postpone and lengthen construction schedules.

The NAHB report concludes: “The number of single-family homes under construction has remained relatively steady at 340,000 for the past six months and the number completed just above 600,000 for the same period. The steadiness is evidence of builders continued conservative approach to adding inventory and the builders’ read of the same conservative nature of potential home buyers. As the economy continues to expand, consumer confidence in housing will return and the housing market will continue its modest expansion.”

“All the elements – the key drivers – are coming together as forecast. The only thing that’s been harder to predict is the pace of the recovery. U.S. housing markets are improving – but painfully gradually.”
– Mark Kennedy, CIBC