When the Canada Mortgage and Housing Corporation (CMHC) published results of their survey aimed at measuring foreign ownership levels in the Canadian housing market, few believed the results. According to CMHC, rental condos under foreign ownership were just 2.4% in Toronto and 2.3% in Vancouver. Economists questioned the calculation methods. CMHC acknowledged “data gaps”. So it was interesting to hear that by all reports, Bob Rennie’s presentation at the B.C. Wholesale Lumber Association Smoker earlier this week was refreshing for its candor. Rennie unequivocally confirmed offshore money is largely responsible for supporting recent real estate activity in Vancouver and across the Lower Mainland.
While the drop in the Canadian dollar against U.S. currency is encouraging Canadian lumber exports to the U.S. market, both sides of the border are searching for direction amidst diverse economic and financial variables at play. All of this going on at the same time as winter weather has been doing its best to upstage Super Bowl hype. The time-lapse video below aired on CNN last night, capturing what 34 inches snowfall looked like in Berlin, Massachusetts.
In a week leading up to Super Bowl we’re still absorbing implications of variable air being let out of things on both sides of the border. On the Canadian side, weaker oil prompted economic measures aimed at pumping a deflating economy. On the U.S. side, any oxygen in the President’s State of the Union address seemed upstaged by headlines of deflated footballs. The annual NHL All-Star break this weekend garnered little attention with no claims of deflated equipment despite goalie Roberto Luongo’s preference for a softer puck.
Closer to home, B.C. Wholesale Lumber Association President Chris Sainas is pumped to confirm leading real estate marketer Bob “Condo King” Rennie will be the keynote speaker at tomorrow’s BCWLA Smoker in Vancouver. Speaking of sales, it’s reported majority of lumber analysts project benchmark SPF lumber prices to average between $370/M and $375/M this year (up from $350/M average in 2014). With the benchmark SPF price presently at $312/M, permabull Daryl Swetlishoff explains here: “At the core of our forecast is our assumption of total U.S. housing starts, which Raymond James expects to increase 10 per cent to 1.09 million units in 2015. We note this forecast remains conservative relative to consensus at 1.18 million units.”
On the road to Kula, Maui – photo credit: ejh (01-25-15)
When lumber traders go to Maui in January, they load up the Kindle with reading material, book tee times, and secure tickets to the PGA’s Tournament of Champions – unless they have a three and five-year-old who love the water!
It’s the time of year for predictions. Almost everyone’s got a few. Around here, there’s really only one. We’ll be working hard this year!
And, leave the rest of the forecasts to experts. Even so, it’s fun to read what some of them predict – especially the positive economic predictions for areas involving the lumber business.
Who wouldn’t enjoy the CNBC report suggesting general outlook hints 2015 market forecast looks too good to be true. As usual there are forecasts involving the Pope and Putin. Plenty of predictions for sports winners, albeit few foresee the Vancouver Canucks winning the Stanley Cup this year.
The astrology predictions as usual include more about “meteorites heading our way” in 2015. Here’s hoping they don’t interfere with our on-time delivery commitments. The astrologers tell us there will be a huge leap in human consciousness this year. Lumber production in B.C. meanwhile, not so much. Several predict that Prince Harry will get engaged. One predicts that there will be more volcanic eruptions in Japan and Hawaii in 2015. Astrologers all agree that the best predictions are formed in dreams.
With all that expertise as background, I’m heading to Maui for the next couple of weeks to do a little dreamin’ on the beach and maybe check out the time frame for fresh volcanic ash on Haleakala.
Happy New Year!
Haleakala (Photo Credit: aboutmauniu.com)