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NEW HOUSING PRICE INDEX...
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) l N5 Y* D7 J# G5 XThe New Housing Price Index, has just been released and it provides some very! b: }. K: v5 b; _
interesting insights, not only into where the market has moved, but where it6 I1 C9 h( D0 }; Q3 f
will be going.& y9 B# R. d; Y1 r+ D3 M, i8 [/ D
! N% _; H8 k* s/ h- u+ T9 ^8 o* \It proved, once again, the value of looking at fundamentals behind a market.0 n5 X& J3 b. S/ |& k1 B
: _# ^& A8 u2 C, _+ FThe New Housing Price Index is compiled by Statistics Canada and is used by
2 }3 r! S3 \1 a% |sophisticated investors to see how much the market has moved, as well as an/ N4 `( W/ X- N8 M* e: i
indicator of where re-sale home prices will be moving in the coming six months. ' Q! Z6 R1 L' ~ T
We look at the ripple effect that new housing prices have on re-sale property9 B7 A, F- H2 J
values and can extrapolate what direction re-sale prices will be moving and by
( m9 y8 b; {0 _how much.% F; J5 z3 |* \$ G2 A @0 W5 q
% H [1 j- c- @For instance, for the last three years, we have told investors to avoid Windsor,
4 f1 r" o% y4 M0 B n+ W' WOntario as an investment area because the underlying fundamentals are not very- v' ` c) I' s' F& o/ x1 o5 F) Z
strong. This has been proven once again with the release of the latest
! f# u ^/ O' N efindings. New Housing Prices have actually decreased by .5% during June 2005 -3 ^& J: @- {5 B$ }3 T
June 2006 proving that fundamental investing works in helping you pick the best6 a J+ W- L: M4 f+ l: Y+ ~
markets and avoid the flat ones. This .5% decrease should have little impact
1 j" [2 Y( O' j; U w' K/ N; [on average re-sale values in the Windsor region.
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To contrast this, the fundamentals we discuss are so strong in Calgary that the! N' e9 @5 B* C% i
market continues to be super heated. With close to 3,000 net new people into
) }8 r1 H) R/ Z+ Z- Gthe city every month, the property market just can't keep up. That is why we
$ X% v; n, O3 Zsaw the New Housing Price Index increase by 49.2% (June 2005 to June 2006). . ]" h8 ^2 ?: U6 E
This is great news for the future of re-sale values in the city as these
$ C% m- n% g, K' t# w6 X2 \* cincreases will continue to ripple out into the market for at least the next six
d! R3 O, h3 G$ T+ `( Gmonths.
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Comparing these two regions is a great illustration of the value of not getting4 v0 p. v$ }9 b# e, Q6 d; Y% Z$ ~
caught in the 'emotional guessing game' by just focusing on the underlying' h/ w7 t5 u6 ~. v
fundamentals. It is sad to see those people who said in the last 2 years that
- P3 n/ K1 A' h, w' T6 wthe Alberta real estate market was over and they were going to sit back and wait6 @) `9 [* S) T) ~: B: a) E
until it drops. Quite obviously, they have missed out on AMAZING gains, all+ E9 a6 m" }1 _% K; t
because they didn't follow fundamentals, they just led with their emotions.8 Z2 d; ~! l* j6 ~
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By the way, Edmonton's New Housing Price Index is up an amazing 28% so far (June
- ^# G& R6 o* k4 x( s3 H& H% |; N/ f2005 to June 2006), also great news.
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By comparison across the country, these are the numbers for June 2005 - June
" q/ X# ~2 g5 R: N( F5 Q2006 New Housing Price Index for:
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Vancouver . . . . . . . . +5.2%
) e! l' o, r$ H. L$ ~4 h5 bSaskatoon . . . . . . . . +8.5%7 ^2 k/ D/ N1 r( g, @1 i2 v
London . . . . . . . . . . . +3.0%" s3 J0 ^9 A1 O( H
Hamilton . . . . . . . . . . +4.9%. b7 a6 q% S E5 h
St. Catharines - Niagara . . . . +4.9%8 a8 U r: A& l- ?& c5 {( b+ }
Toronto and Oshawa . . . . . . . +3.2
* E/ W/ m! I( K6 G, v0 vOttawa - Gatineau . . . . . . . . . +3.1%
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0 ^4 ^; M* @0 H1 SFundamental investing ALWAYS makes you look like a genius - emotional investing2 L# V. L" ^9 K5 R* f
gives you quick highs, but also quick lows. Well done on your focus!* T7 r( p4 ]; F" j6 u2 b$ x
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As the fundamentals have been showing all along, the Alberta market continues to2 Y2 n5 N! `7 _. W
be strong, as in-migration and job creation continues to attract people from not. F! Q" M' A+ W# W% K
only across Canada, but from around the world. Our average wages are& R2 `: G" m+ k
increasing, our population is increasing, our unemployment rate continues to
# F0 X( U N' `$ X; Sdrop and our GDP growth is slated to once again lead the country.
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Here are some very interesting facts that are helping to support the strong) v" _8 H. {: n' @9 Z
fundamentals:
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" e" x* \& E. Z2 T5 W1. The Conference Board of Canada is forecasting strong economic growth in
5 A) U& p" r9 J, U% Z. h1 \- NCanada, with Alberta once again leading the way. In fact, the projected growth; w% r9 i( x8 {+ m0 k0 y" }/ U. g
for Alberta's economy is a staggering 6.6%. (BC + 3.6%, Ontario + 2.5%), and; ~* E1 y0 ]; Y. b3 J
this is slated to occur even with the labour shortages we are witnessing.
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! k" @4 C+ G4 I# |2. People are discovering Canada as an investment center from all over the+ {: R2 w) Z; H4 L Z8 D
world. Recently, there have been investors coming here from Asia, Australia,
2 P! e" F2 g/ r) K6 Nthe US, UK and Europe. In fact, if you review the world's press you will see
1 `. \1 z5 E8 q( j9 wthat Canada (with a focus on Alberta) is being discussed more frequently. # @1 i S2 w! A8 ], b j6 h# g
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3. Don Campbell has just returned from presenting our Canadian investment+ s( r' z. _& o$ L+ s
atmosphere (including Why Alberta - Why Now") to a group of major investors in
0 p1 \+ X6 F. X) f& b" W2 ADublin, Ireland, and the response was overwhelmingly positive. In fact, after) F, e3 l6 `- [
Don presented the economic facts, many of these investors (who could invest8 \* @% F8 I, f! ?1 V
anywhere in the world) have already booked their flights to here. Once again
9 H7 f$ E% [) x. ?: Z6 ]. Rproving that when the true numbers of our economy are presented (along with the2 g1 v. @+ ~/ e( B5 Y
political stability of our country), there is no place in the world that can
& {! D" \0 U: pbeat it for long term investment.
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; s5 Z, B4 g! D" J4. Job creation continues to be strong (with a small lull in June); definitely4 P8 @8 L' i: l: d/ P
a sign of strong long-term fundamentals. RBC has also been following the job
# y9 v8 O8 y9 P! Q4 screation situation and here is what they are saying: (www.rbc.com/economics)9 R) D0 Y0 j7 l" ?% f
"After generating a substantial 96,700 jobs in May, the largest such gain since; Q9 m) D, {" \0 x: p% l9 \
January 2002, the economy lost a modest 4,600 jobs in June...
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Strength in the Canadian economy contributed to a gain of 215,600 jobs in the
' O2 C0 J( d: Q! D. [2 t- Nfirst half of 2006, a feat not matched since the second half of 2002. With the
S/ _: p a$ d& G3 `8 H2 g W& f3 reconomy widely expected to grow at a more moderate pace in the second half of9 H% r+ Q" V8 a; g% ^, p
the year on the back of slowing trade activity, this impressive showing may not
5 w5 r( }! q1 D4 Lrepeat itself. We expect that employment grew in July at a pace consistent with0 ]+ s/ d0 h/ A- ~
its recent trend of 24,000 jobs a month. Assuming that the labour force grew at
, n$ h7 K' G2 o+ Vits trend rate, a gain of 24,000 jobs will lead to a national unemployment rate9 T* a; I$ B* X8 C( f- l5 A) O# i
of 6.1%." Overall very good news. Now the key is to ensure that the region in
( S) z2 n9 {0 X, T6 `( T& \! rwhich you are investing is continuing to generate jobs and increasing incomes.
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In other words, it is a great time to be taking advantage of this strong! I4 V) g+ K ]5 S' @
economy, avoiding 'excuses' and to especially not listen to the uninformed" i( t( |6 B- X( x
'dream stealers.' As long as you stick with your game plan, you continue to do
% j$ `/ H& H9 Q3 J' }your due diligence, and you remove emotions from the equation, you will see the
/ K: f% i6 `: o: ]4 r8 C9 kopportunities that are right in front of you, right here in Alberta. Let the3 x4 U, J5 y- X6 m; I! Z- K
'dream stealers' call you 'lucky' 5 years from now as your net worth has soared5 n e# s4 V9 }3 [0 ]
and your financial freedom has surpassed even your wildest expectations." Q- q) M8 C' ~* {% {8 N! m
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- ?" P0 M9 h% x S3 V& ]1 DCapital Gains Comparison.
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" |1 l* s+ }1 j( S! a9 g9 w+ `8 `KPMG has recently released a comparison of the true Top Federal and Provincial
2 m/ ]) r# q" {( {2 \ kMarginal Capital Gains Tax Rates per province. It is very interesting to see
: H4 t8 k9 @5 c! ?7 R0 phow these will affect your exit strategy. Here are the numbers:7 H, R8 z4 ?: ?. C- Y- [' H
4 [# d* H9 R9 r- h. }BC . . . . . . . . 21.9%
* j& B! s3 \6 s, o6 eAB . . . . . . . . 19.5%
# f& w0 g& Y7 ~SK . . . . . . . . 22.0%
5 Z. h4 w _5 S8 z1 P# gMB . . . . . . . . 23.2%
- P; @6 g7 D% z- X' i9 j2 YON . . . . . . . . 23.2%
& z J9 A% c c, vQC . . . . . . . . 24.1%
, Q& \' N# p1 ?% H! P( y" {NB . . . . . . . . 23.4%- o, T+ J7 n% A4 t! r
NS . . . . . . . . 24.1%
9 M( Z( y4 ?" f' I8 P0 vPE . . . . . . . . 23.7%6 u9 E; H$ T5 o1 ~, o' d; t
NF . . . . . . . . 24.3%" |$ U k- g) ~+ o% [
* l2 z4 Q J: j9 _Lower capital gains tax increases investment and stimulates the long term
% p# x: t" I" l, f/ Ceconomy of the province. It also allows real estate investors to keep more of$ z/ z+ N$ T( _. N P4 w" Q
their profits at exit time. Always a good number to pay attention to." o$ i! `; l* H1 L0 v
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( s( ^0 C5 g4 P9 p0 {Overall, by staying focused for the next short period of time, you have the
) a+ M0 c/ \' w( @1 z3 t* lopportunity to create financial freedom of which others can only dream. Of
5 g, r7 ]7 d7 p3 m& [# Bcourse, the key word is focus. And with an August line-up of 'Members Only'
% i0 |( {" u, x5 ~/ nevents like this, you can't help to become a real estate investment champion
* V6 V5 |0 {" H- }7 pwhen you take action as a full REIN Member.# j4 Z( U* Q+ l. n6 g
% O" ^6 @. m% G" U4 ?Focus on the fundamentals, keep emotions out of your decisions, and enjoy the Z! {( f, g$ @
results in just a few short years. |
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发表于 2006-8-25 08:35
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