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NEW HOUSING PRICE INDEX..." M: ?# L, a- O& o1 Y' d$ E5 H, p
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The New Housing Price Index, has just been released and it provides some very+ V7 Z8 C# x2 `5 c
interesting insights, not only into where the market has moved, but where it ]- F- V/ g/ k! O
will be going.
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It proved, once again, the value of looking at fundamentals behind a market.
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: d0 l( C2 o( F5 [The New Housing Price Index is compiled by Statistics Canada and is used by
3 o7 S4 u( X) U1 Gsophisticated investors to see how much the market has moved, as well as an
! p7 ~+ n0 n, Sindicator of where re-sale home prices will be moving in the coming six months.
+ \3 q; N* ]7 w( h @, LWe look at the ripple effect that new housing prices have on re-sale property
/ O, g7 Y/ h5 y2 ]values and can extrapolate what direction re-sale prices will be moving and by
; j. ]* Q2 y) Y" h# J4 ~how much./ c, x4 Y& \. m2 u" ]% U- r5 P8 q
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For instance, for the last three years, we have told investors to avoid Windsor,
$ k7 v( ~$ ~$ I7 d. [7 HOntario as an investment area because the underlying fundamentals are not very
& R, F! ?6 t3 pstrong. This has been proven once again with the release of the latest9 G2 N- M% {& o/ K& L
findings. New Housing Prices have actually decreased by .5% during June 2005 -" x0 d; E b& Y" U
June 2006 proving that fundamental investing works in helping you pick the best/ Y2 [( f; p, N0 D2 Z/ |; p
markets and avoid the flat ones. This .5% decrease should have little impact: U g3 L2 p- s X3 S
on average re-sale values in the Windsor region.4 c, U* K' H" l
$ a% q8 M! h4 s( ?0 ]9 e- r
To contrast this, the fundamentals we discuss are so strong in Calgary that the
$ S) {& |' K7 `; G% |market continues to be super heated. With close to 3,000 net new people into
8 N9 q- s" d6 Ethe city every month, the property market just can't keep up. That is why we0 W) v: r+ Q) p2 p7 c: |& n$ Y( f
saw the New Housing Price Index increase by 49.2% (June 2005 to June 2006). & M3 F+ ]0 P% P/ }
This is great news for the future of re-sale values in the city as these$ Q( o# V0 b2 a* E( v
increases will continue to ripple out into the market for at least the next six4 V2 A' f; ]$ k6 Z8 n; b' `
months.
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Comparing these two regions is a great illustration of the value of not getting
# V; s3 K7 k) E2 g9 @5 xcaught in the 'emotional guessing game' by just focusing on the underlying8 ]1 X; g" ~' ?8 t2 H) [4 n3 T
fundamentals. It is sad to see those people who said in the last 2 years that, f* U4 }3 m) Q! d" u8 w$ y- _
the Alberta real estate market was over and they were going to sit back and wait
. I% j% I8 V1 D% ?. }until it drops. Quite obviously, they have missed out on AMAZING gains, all% S4 D6 [/ j% i1 x9 i' P1 b v: }
because they didn't follow fundamentals, they just led with their emotions." ]8 k1 r( M1 g& J+ k
1 A( v: D8 h! |8 z) A/ h+ F, {; N. @$ ABy the way, Edmonton's New Housing Price Index is up an amazing 28% so far (June% M9 R I! U) I. w/ R, Z1 c1 u
2005 to June 2006), also great news.
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By comparison across the country, these are the numbers for June 2005 - June
8 ~' y, C. u B' j( M+ l! J1 u2006 New Housing Price Index for:' U: J1 j7 C- G6 Z5 C
# `; @4 e8 j4 [2 q: aVancouver . . . . . . . . +5.2%8 s) t$ h1 g1 S# n
Saskatoon . . . . . . . . +8.5%
$ m1 a' O8 x+ y0 z- \7 M0 DLondon . . . . . . . . . . . +3.0%8 G: r4 p" J, `) A1 R+ u& h2 l, r
Hamilton . . . . . . . . . . +4.9%
H" m; x1 ^3 [! q ]St. Catharines - Niagara . . . . +4.9%
" F- P! c5 I' }/ r- k) a1 D( dToronto and Oshawa . . . . . . . +3.24 J" D9 K7 S/ c% t' _0 m5 \
Ottawa - Gatineau . . . . . . . . . +3.1%4 x7 P# q7 J$ q* L+ y8 C
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Fundamental investing ALWAYS makes you look like a genius - emotional investing0 M; s9 j: x, B4 M# M6 u, @
gives you quick highs, but also quick lows. Well done on your focus!
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As the fundamentals have been showing all along, the Alberta market continues to1 K" W/ n* n5 O. c8 Z2 T4 {
be strong, as in-migration and job creation continues to attract people from not
. A) W1 Q% A) g6 ~1 ?0 W, u% V1 conly across Canada, but from around the world. Our average wages are
) f6 X( c2 |- G' C; o V% d1 t* k- Iincreasing, our population is increasing, our unemployment rate continues to
$ W- `1 {4 h) r% x. qdrop 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
" T% _6 m7 k' Y( k" s- U' B2 Hfundamentals:
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1. The Conference Board of Canada is forecasting strong economic growth in
& r) B# W: Z w9 tCanada, with Alberta once again leading the way. In fact, the projected growth
; Y/ i1 g$ ^" K; K8 g/ O# lfor Alberta's economy is a staggering 6.6%. (BC + 3.6%, Ontario + 2.5%), and
4 c5 L. m/ R" S0 q bthis is slated to occur even with the labour shortages we are witnessing.# k8 x& m, k" a, E
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2. People are discovering Canada as an investment center from all over the" u; d& m& O8 i7 z% i1 g% U
world. Recently, there have been investors coming here from Asia, Australia,7 I. Y' Z' ?& e
the US, UK and Europe. In fact, if you review the world's press you will see, ?/ y8 W' _7 A, w6 R
that Canada (with a focus on Alberta) is being discussed more frequently.
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0 k( t( q6 G' Q3. Don Campbell has just returned from presenting our Canadian investment
8 p0 Y8 X0 t( C! S( ~* katmosphere (including Why Alberta - Why Now") to a group of major investors in
) @+ s, q3 E7 ?7 r1 ?2 {/ _3 ODublin, Ireland, and the response was overwhelmingly positive. In fact, after7 R1 Y* f6 R. @5 I6 e. ?
Don presented the economic facts, many of these investors (who could invest& L+ \3 H p, M
anywhere in the world) have already booked their flights to here. Once again
% G' l/ s; E$ z& A1 l. g* f& Zproving that when the true numbers of our economy are presented (along with the
1 z. n7 x( N/ P2 V) dpolitical stability of our country), there is no place in the world that can
& n- B2 N0 X0 |8 C* f4 jbeat it for long term investment.
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4. Job creation continues to be strong (with a small lull in June); definitely
( Q# c1 I! R! Y `& Sa sign of strong long-term fundamentals. RBC has also been following the job
# W5 Z1 l! R! W2 G& I1 Z$ g3 x3 Bcreation situation and here is what they are saying: (www.rbc.com/economics)
4 r8 r1 a1 G' M/ k/ ]5 d8 y6 g"After generating a substantial 96,700 jobs in May, the largest such gain since0 Y: B% a& R4 @; B8 O
January 2002, the economy lost a modest 4,600 jobs in June... ! n1 f2 S3 g# @4 ~+ Z0 v
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Strength in the Canadian economy contributed to a gain of 215,600 jobs in the# A1 c9 b( m% |2 l
first half of 2006, a feat not matched since the second half of 2002. With the
' k3 }3 Q/ ?+ y/ R+ S0 W- }+ M" X# ?economy widely expected to grow at a more moderate pace in the second half of g6 M T7 C0 R' z9 C5 X, q
the year on the back of slowing trade activity, this impressive showing may not+ r6 S" E' U* \ n( X3 y
repeat itself. We expect that employment grew in July at a pace consistent with
P9 A: W: H( F; Rits recent trend of 24,000 jobs a month. Assuming that the labour force grew at9 ^. Z* e2 c0 p! w* S$ Z" K) h B
its trend rate, a gain of 24,000 jobs will lead to a national unemployment rate! b, {2 b e1 F* {; _0 U2 J
of 6.1%." Overall very good news. Now the key is to ensure that the region in# Y+ I0 ?" Y0 |9 _
which you are investing is continuing to generate jobs and increasing incomes. t" }) d" q( n9 T$ X
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In other words, it is a great time to be taking advantage of this strong
- `4 F$ Y4 T5 a8 I. i% |economy, avoiding 'excuses' and to especially not listen to the uninformed
, V! l( k+ ~9 J0 Q& N'dream stealers.' As long as you stick with your game plan, you continue to do) l$ M5 r. O1 k$ Q
your due diligence, and you remove emotions from the equation, you will see the D- {+ P& ?' i) H; e7 C. y2 Q
opportunities that are right in front of you, right here in Alberta. Let the
b* D6 i% [% ~4 A5 N'dream stealers' call you 'lucky' 5 years from now as your net worth has soared
?1 P( E) F$ Pand your financial freedom has surpassed even your wildest expectations.* _9 f2 M; H3 L. G: I' w& c
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; l; k9 Z8 A; pCapital Gains Comparison.- R3 c/ H) \: A0 C) e* D2 w
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KPMG has recently released a comparison of the true Top Federal and Provincial, U+ X9 |+ J& \0 _- z
Marginal Capital Gains Tax Rates per province. It is very interesting to see0 g6 m4 p. N$ Q* N
how these will affect your exit strategy. Here are the numbers:
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BC . . . . . . . . 21.9%8 {# _5 O/ Q+ s" {: e" s
AB . . . . . . . . 19.5%4 p x, t0 `: Q+ r9 Z
SK . . . . . . . . 22.0%5 G2 N$ L% k, H3 H/ f8 Q8 s
MB . . . . . . . . 23.2%4 |4 ^( M! i, Y* p
ON . . . . . . . . 23.2%
/ p3 g$ C3 a1 T# P8 b' ]% ~QC . . . . . . . . 24.1%
7 [. G* K/ Q: x' J P9 U$ sNB . . . . . . . . 23.4%
( l: e. b( S% ^8 c/ \NS . . . . . . . . 24.1%
( ^/ t5 n6 C2 b' Z8 u* cPE . . . . . . . . 23.7%4 n$ T! u4 O" ~" s$ P! S# C
NF . . . . . . . . 24.3%
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& p! R$ Q. D: L" r8 |* L0 ULower capital gains tax increases investment and stimulates the long term
% p, k% w* k# r6 h- ueconomy of the province. It also allows real estate investors to keep more of
R+ ]0 Q% f) N1 Q9 i) Dtheir profits at exit time. Always a good number to pay attention to.$ Q( P9 l4 {& g2 }& }
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Overall, by staying focused for the next short period of time, you have the
+ ?, @( v3 c- |* _* f5 B# Sopportunity to create financial freedom of which others can only dream. Of
7 l0 r a9 y8 Q3 ^/ | e+ B, acourse, the key word is focus. And with an August line-up of 'Members Only'' ?8 Z; P" K- s: W' @* _
events like this, you can't help to become a real estate investment champion, N+ @0 g' B" R6 R# d. B$ J
when 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
1 a2 S- l: j* R. gresults in just a few short years. |
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发表于 2006-8-25 08:35
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