The Washington Post is reporting on the disaster that is the British Columbian Forest industry – that the U.S. housing crisis is about to crush what has long been considered the backbone of the British Columbian economy.
I am very happy that they decided to do a three page spread about the B.C. towns that are falling apart, because I may not have realized how grim the situation really is. The local Vancouver media would never run a story like this.
Because it’s bad economic news, and we can’t have any bad economic news in our papers, people might stop buying real estate.
I live in beautiful, Vancouver British Columbia, where for just 70% of your income, you too can live in a three bedroom bungalow. This is a real estate market that should have cooled down before the end of 2006, but instead it roared through 2007. It roared through however, because people were bombarded with messages like “buy now or be priced out forever”, “real estate only goes up”, or my favourite “it’s different this time”.
The average single family home is now priced at $742k in a community where the average family income is $54k – things have spun completely out of control. And that’s the problem, I’m afraid that it’s too far out of control.
There are over 100 communities and 200,000 jobs depending on forestry. News of their doom could have people questioning whether or not this is the best time to sign up for $4000 or $5000 a month for 40 years. That of course could start to effect the 280 000 jobs in construction, or the 17500 real estate agents, that all depend on the boom’s continuing booming.
The media can’t report anything “anti real estate”, that would upset their advertisers, the ones who buy pages and pages of space to show off their shiny granite counter tops. Bob Rennie, our local real estate guru, has more power then the mayor.
So British Columbians have continued their trek through open houses, and have left themselves with a personal savings rate of -7.9%. Combine that with a province that has a 17% poverty rate, and a government that has spent $1.6 billion on the 2010 Olympics, and we’re stretched real thin.
But we’ll all keep our heads in the sand. We’ll buy our Starbucks, and read reports telling us how fantastic we are. The most controversial topic to cross the news in the past week was the mayor’s request to have fire trucks turn off their sirens at night, they disturb his sleep.
That, in itself, says so much .