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NEW HOUSING PRICE INDEX..., q1 ^& | e% n8 {
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The New Housing Price Index, has just been released and it provides some very: j# d5 M1 U0 U0 O: ~* A* ~4 M
interesting insights, not only into where the market has moved, but where it* ]* e7 |" K$ |' T
will be going.
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* H3 i4 ` M2 r( h5 OIt proved, once again, the value of looking at fundamentals behind a market.
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The New Housing Price Index is compiled by Statistics Canada and is used by
+ g) H: L a2 F4 ]sophisticated investors to see how much the market has moved, as well as an/ E1 W$ r8 ?+ ~$ B- Y
indicator of where re-sale home prices will be moving in the coming six months.
9 F- w5 V- \# }. @8 N' SWe look at the ripple effect that new housing prices have on re-sale property* W5 O6 A1 a+ F9 B2 z
values and can extrapolate what direction re-sale prices will be moving and by
: Q; g% p3 g$ E- l/ \: u X! Thow much.$ z: l e0 u3 H/ F) Y
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For instance, for the last three years, we have told investors to avoid Windsor,
# t* s% i+ C, w8 v: h1 t5 POntario as an investment area because the underlying fundamentals are not very& ?8 L" z) U& \* i
strong. This has been proven once again with the release of the latest* a- {) q0 n0 i5 e, C
findings. New Housing Prices have actually decreased by .5% during June 2005 -6 v# s9 t: v5 q \
June 2006 proving that fundamental investing works in helping you pick the best
' I% L) a2 P" ?) L; V) imarkets and avoid the flat ones. This .5% decrease should have little impact
( E# a9 v d- |, ron average re-sale values in the Windsor region.
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6 }+ `8 L. i: @! q4 y; ~* RTo contrast this, the fundamentals we discuss are so strong in Calgary that the6 P6 F' K9 s; h6 U
market continues to be super heated. With close to 3,000 net new people into
$ X( K, @# v% g2 k- r+ {0 Lthe city every month, the property market just can't keep up. That is why we
( I6 |. r9 f1 z; Qsaw the New Housing Price Index increase by 49.2% (June 2005 to June 2006). - O7 \: \6 T& P4 K
This is great news for the future of re-sale values in the city as these6 V3 ~+ A* ?2 y9 R
increases will continue to ripple out into the market for at least the next six" y) D8 Q7 _+ S+ I4 w2 |
months.
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Comparing these two regions is a great illustration of the value of not getting! P! E, U4 Q7 j- R) @
caught in the 'emotional guessing game' by just focusing on the underlying2 q# g: d' n& f" @
fundamentals. It is sad to see those people who said in the last 2 years that; b a1 y) O& Y" r$ ]" X% v: G
the Alberta real estate market was over and they were going to sit back and wait8 B+ ]- }' e8 D5 u6 K- K
until it drops. Quite obviously, they have missed out on AMAZING gains, all8 J# m/ |, ^$ s, D D, n
because they didn't follow fundamentals, they just led with their emotions.9 z m& [* K, q& I
: ^1 T7 R3 i7 n! {0 h4 aBy the way, Edmonton's New Housing Price Index is up an amazing 28% so far (June
- j6 ^7 d' ~9 H6 ]/ Y2005 to June 2006), also great news.8 m( d ?; S, V6 J$ @ ?) u/ S
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By comparison across the country, these are the numbers for June 2005 - June
1 y+ D7 A* @% q. E2006 New Housing Price Index for:/ H, L! f. e& u8 a# z3 b
* q* m% ~1 g5 {3 v. eVancouver . . . . . . . . +5.2%
6 J+ u* `( A2 q7 lSaskatoon . . . . . . . . +8.5%
% E1 {6 P% Y$ rLondon . . . . . . . . . . . +3.0%
/ x4 ?3 J8 t* J M: pHamilton . . . . . . . . . . +4.9%
) c1 ~8 }" h8 h1 hSt. Catharines - Niagara . . . . +4.9%
! {6 S/ v1 N$ T& o% f, sToronto and Oshawa . . . . . . . +3.2$ x" J9 B$ B9 q
Ottawa - Gatineau . . . . . . . . . +3.1%. p4 R; H( _5 X( T4 a* ^' k) |( v& I
- w" d& e2 ^, ^( X# IFundamental investing ALWAYS makes you look like a genius - emotional investing& M- E0 Z# l. F6 A
gives you quick highs, but also quick lows. Well done on your focus!
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4 }3 ?" v3 x8 {; F* [ U! }$ }( gAs the fundamentals have been showing all along, the Alberta market continues to1 U% e: u3 H% _4 S' q' Z& ]
be strong, as in-migration and job creation continues to attract people from not
& w& A( D$ G6 m9 sonly across Canada, but from around the world. Our average wages are
- `! C+ L0 u5 `' h; {2 ?* |+ G) Cincreasing, our population is increasing, our unemployment rate continues to
+ B3 A7 q# V" l7 c7 j! Jdrop 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 strong7 ^2 E0 F1 J. W4 l% T+ u5 }
fundamentals:4 R, L3 ?$ F) ?$ K* Q6 P: j
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1. The Conference Board of Canada is forecasting strong economic growth in
3 K* H' D2 i! Z! GCanada, with Alberta once again leading the way. In fact, the projected growth7 b# d: y; I) I2 ^& i
for Alberta's economy is a staggering 6.6%. (BC + 3.6%, Ontario + 2.5%), and9 G$ t, M6 w" @: n, H
this is slated to occur even with the labour shortages we are witnessing.
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+ I; r. ^% I) c2. People are discovering Canada as an investment center from all over the
; f; H% C; Z. z8 `: I- Gworld. Recently, there have been investors coming here from Asia, Australia,. y/ ?/ k' ]5 k$ S' i
the US, UK and Europe. In fact, if you review the world's press you will see
9 O, U, e! W0 y- N5 O+ cthat Canada (with a focus on Alberta) is being discussed more frequently.
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! O6 {6 `( U a$ I$ T5 o7 j: x3. Don Campbell has just returned from presenting our Canadian investment7 i+ e2 H( S d5 \8 T O' m
atmosphere (including Why Alberta - Why Now") to a group of major investors in
) E* c' ?7 _; x9 H0 E2 mDublin, Ireland, and the response was overwhelmingly positive. In fact, after
l% q9 G7 J3 Y5 t* |! D1 O/ nDon presented the economic facts, many of these investors (who could invest4 i2 V$ m/ W0 a N( u
anywhere in the world) have already booked their flights to here. Once again2 _9 e Y3 }, j# T0 \2 t
proving that when the true numbers of our economy are presented (along with the! w- f) |% ~* X4 a9 R0 c. M1 g+ o
political stability of our country), there is no place in the world that can
6 C& \0 l/ l: X. _, r2 o% Nbeat it for long term investment.
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3 i9 h( w# m; P% B2 B' F3 h* d4. Job creation continues to be strong (with a small lull in June); definitely" l3 M2 ?! y9 ]+ `+ Y
a sign of strong long-term fundamentals. RBC has also been following the job8 y! ]% k+ Z' R+ `+ L
creation situation and here is what they are saying: (www.rbc.com/economics)
& b4 H3 A$ o+ \6 P' x"After generating a substantial 96,700 jobs in May, the largest such gain since
6 _4 R" S |" x" `- x1 ]( u. \' IJanuary 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* Q9 T! i8 `4 \
first half of 2006, a feat not matched since the second half of 2002. With the
/ e. C: ~0 _2 ?. l' ]" ^4 q1 seconomy widely expected to grow at a more moderate pace in the second half of
' W/ n, ?$ V/ K2 i- Lthe year on the back of slowing trade activity, this impressive showing may not, j2 X1 L9 Y4 Q6 s! w$ a1 x
repeat itself. We expect that employment grew in July at a pace consistent with4 a# o" N2 K; k5 V% r
its recent trend of 24,000 jobs a month. Assuming that the labour force grew at
7 u5 K7 L# I8 tits trend rate, a gain of 24,000 jobs will lead to a national unemployment rate9 z( u' ^; y2 ]8 m& B- i" C
of 6.1%." Overall very good news. Now the key is to ensure that the region in+ V5 s ]2 Z( b; o; k. F
which 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
4 P, m3 T- v6 C7 Teconomy, avoiding 'excuses' and to especially not listen to the uninformed
0 k. n+ X" T8 m: R& E9 T'dream stealers.' As long as you stick with your game plan, you continue to do
( g9 R/ E' ~) Fyour due diligence, and you remove emotions from the equation, you will see the
7 F# ^# y$ g0 v3 Xopportunities that are right in front of you, right here in Alberta. Let the
" u! x/ _- h, Z/ o3 A- `( `: G'dream stealers' call you 'lucky' 5 years from now as your net worth has soared1 ?8 L; `! C$ v; J
and your financial freedom has surpassed even your wildest expectations.
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Capital Gains Comparison.2 d& y3 q6 X3 f+ c
4 w% O5 ?2 K! ~# e2 Q& T- f/ ^KPMG has recently released a comparison of the true Top Federal and Provincial
9 l ]/ X, K0 X1 H0 |& b5 K8 F7 Z6 RMarginal Capital Gains Tax Rates per province. It is very interesting to see, b( d- `; Y' A F, g/ g+ y; F4 j
how these will affect your exit strategy. Here are the numbers:# s ^* M( g6 j( c
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BC . . . . . . . . 21.9%9 \9 @$ C9 l: m, V* D+ a' u
AB . . . . . . . . 19.5%5 K5 x! s) T! Y4 S% [. l
SK . . . . . . . . 22.0%7 v" e( W6 W: O0 p
MB . . . . . . . . 23.2%
, c1 `% V: J- pON . . . . . . . . 23.2%! I" A0 [+ ~( ^4 z! U" l$ }
QC . . . . . . . . 24.1%+ e- B2 W1 E4 G% k J( Z
NB . . . . . . . . 23.4%$ j1 @4 b- h: Q. z) g% n7 Z T
NS . . . . . . . . 24.1%
7 K6 ^- z3 \& K" D9 iPE . . . . . . . . 23.7%
/ G8 `( V: g; `4 YNF . . . . . . . . 24.3%
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' j- V& d; I* r$ n! b$ O) w# dLower capital gains tax increases investment and stimulates the long term
: [, O; }& a% P8 D$ i& {/ E0 f) ?economy of the province. It also allows real estate investors to keep more of" g k+ N, j) a; E6 e
their profits at exit time. Always a good number to pay attention to.5 r; S- Q; h0 z
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9 r5 [5 `) u1 N2 ^2 N9 fOverall, by staying focused for the next short period of time, you have the
/ i& @ k' P) copportunity to create financial freedom of which others can only dream. Of
! }8 g6 J# i4 }, c1 Rcourse, the key word is focus. And with an August line-up of 'Members Only'1 V: _( `" g! {8 f4 d. R
events like this, you can't help to become a real estate investment champion
" n5 I1 y5 A$ f! a$ o( G0 z/ j; Nwhen you take action as a full REIN Member.
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Focus on the fundamentals, keep emotions out of your decisions, and enjoy the) Z* G* g8 y; f a5 Z9 `
results in just a few short years. |
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发表于 2006-8-25 08:35
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