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NEW HOUSING PRICE INDEX...- M! E" c* T2 S& x, h, Q: I8 Z
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The New Housing Price Index, has just been released and it provides some very# { r( x- {0 x9 q- A0 A, N
interesting insights, not only into where the market has moved, but where it
3 {, m) R0 S1 x0 o) {will be going.* t9 |- N, j1 \
, E4 N2 M- W4 @# jIt proved, once again, the value of looking at fundamentals behind a market.2 M% P+ ^, F$ u' I! x# h
; z# W0 d+ \' D# N* UThe New Housing Price Index is compiled by Statistics Canada and is used by+ p8 g$ R! u# c
sophisticated investors to see how much the market has moved, as well as an
7 t* p* w- R4 E* o% rindicator of where re-sale home prices will be moving in the coming six months. . R4 N: C" I" ]& G! |4 ]
We look at the ripple effect that new housing prices have on re-sale property
! u5 E% p2 W3 J8 mvalues and can extrapolate what direction re-sale prices will be moving and by
: x0 q+ Z( P% s& Xhow much./ @" a7 `, [% ~+ j
; J& ~! ]- \' _) P* [For instance, for the last three years, we have told investors to avoid Windsor,
& A, B$ K/ x3 TOntario as an investment area because the underlying fundamentals are not very
: X( i4 u, g' [; R% ]strong. This has been proven once again with the release of the latest6 l3 Z7 r6 E+ \3 A
findings. New Housing Prices have actually decreased by .5% during June 2005 -0 B2 T8 `6 F) L* a
June 2006 proving that fundamental investing works in helping you pick the best8 W8 h; P \6 k- X) M4 }
markets and avoid the flat ones. This .5% decrease should have little impact* ~# D) T' E4 P
on average re-sale values in the Windsor region. E! Y! {4 b v9 t
- B3 d% R* k; |To contrast this, the fundamentals we discuss are so strong in Calgary that the V* H* Y4 A3 f, f+ E: ?3 _5 r
market continues to be super heated. With close to 3,000 net new people into
) o% Y/ x* Q7 v! C- g3 U" \the city every month, the property market just can't keep up. That is why we8 p' r, G# B% W0 w W/ Y
saw the New Housing Price Index increase by 49.2% (June 2005 to June 2006). 8 Y( X( t% M6 m. ]* K* w# N6 f
This is great news for the future of re-sale values in the city as these
! Z/ X5 |' g2 o8 t: _7 a- S% uincreases will continue to ripple out into the market for at least the next six
5 r% M. X: m; T, Z mmonths. 9 h0 k3 [# L" l# b- r
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Comparing these two regions is a great illustration of the value of not getting3 s: T7 e! {* i. I- \, d/ j& L [
caught in the 'emotional guessing game' by just focusing on the underlying
! Y$ t! l/ y' v) Hfundamentals. It is sad to see those people who said in the last 2 years that" w% P! K: W0 V. ?0 A# M
the Alberta real estate market was over and they were going to sit back and wait. N9 N- }1 x; b
until it drops. Quite obviously, they have missed out on AMAZING gains, all0 g8 E7 Y' E+ E8 o
because they didn't follow fundamentals, they just led with their emotions.% ]5 x' [7 H) z6 D
$ I$ u1 v5 P6 I5 [. P5 B" jBy the way, Edmonton's New Housing Price Index is up an amazing 28% so far (June: [& d! ^9 Z" q4 C' @
2005 to June 2006), also great news.
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By comparison across the country, these are the numbers for June 2005 - June/ u' s% ?, u7 e9 O" q
2006 New Housing Price Index for:$ l# q( t/ m' l% Q) j8 T" p- Z
; {9 S/ X- ]9 N, e) t. b5 U& C. C$ _Vancouver . . . . . . . . +5.2%
7 {: C+ j8 b, g. ?9 Y7 CSaskatoon . . . . . . . . +8.5%. _$ f! t* i0 k5 J4 f
London . . . . . . . . . . . +3.0%7 ?# H8 y/ i8 m8 R
Hamilton . . . . . . . . . . +4.9%9 q% g! v, b# v/ A$ U
St. Catharines - Niagara . . . . +4.9%8 |! ?. u' g6 K' P* F$ N1 y
Toronto and Oshawa . . . . . . . +3.2
7 c) d) d% c$ o) HOttawa - Gatineau . . . . . . . . . +3.1%& ]0 ]' n0 D$ ?6 R
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Fundamental investing ALWAYS makes you look like a genius - emotional investing; I# z3 Y' V8 n4 A f+ x
gives you quick highs, but also quick lows. Well done on your focus!
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* t2 r9 K5 y% ]% e% \As the fundamentals have been showing all along, the Alberta market continues to
( J8 y' ~2 o' {3 N$ C0 ube strong, as in-migration and job creation continues to attract people from not
1 D5 e0 U* y' V/ N$ r* Konly across Canada, but from around the world. Our average wages are
4 f2 I) k2 |& ~increasing, our population is increasing, our unemployment rate continues to/ \5 j; C! I$ t. d8 c: k
drop and our GDP growth is slated to once again lead the country.
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/ y6 ~0 ^7 Y8 W0 Z1 A% L8 D& QHere are some very interesting facts that are helping to support the strong
7 k" e% V/ y. }/ Z( p6 mfundamentals:
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1. The Conference Board of Canada is forecasting strong economic growth in
# S" s4 q K+ X+ a; Q3 PCanada, with Alberta once again leading the way. In fact, the projected growth
& g' A: d3 t% efor Alberta's economy is a staggering 6.6%. (BC + 3.6%, Ontario + 2.5%), and+ M# J6 r, ^) G+ @$ A
this is slated to occur even with the labour shortages we are witnessing. Y# `, T* j# X: {4 X
: n9 Y. a2 g1 n( }; h* m/ }2. People are discovering Canada as an investment center from all over the. i4 ]/ S# ]2 H# m$ R3 Y1 P
world. Recently, there have been investors coming here from Asia, Australia,
" I w5 P) ~' `' u- Q! E* @) B( Xthe US, UK and Europe. In fact, if you review the world's press you will see4 b8 d( A% t) Q) @4 c0 \7 | A
that Canada (with a focus on Alberta) is being discussed more frequently. 9 g1 [4 I5 w" {/ n, w1 {! v
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3. Don Campbell has just returned from presenting our Canadian investment2 ~9 T0 M9 l# g
atmosphere (including Why Alberta - Why Now") to a group of major investors in
! F) V8 K C, O2 j, @8 cDublin, Ireland, and the response was overwhelmingly positive. In fact, after5 ~6 O1 {) b9 O L1 D& `
Don presented the economic facts, many of these investors (who could invest
$ ^3 t1 m! v9 s. ?. h+ k6 q9 Fanywhere in the world) have already booked their flights to here. Once again
2 B6 ?0 o' g1 v/ q6 @& ?4 Hproving that when the true numbers of our economy are presented (along with the
/ _3 C& x1 @* j4 [7 Kpolitical stability of our country), there is no place in the world that can
1 d/ g ~& ]2 Y. cbeat it for long term investment.
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# Q$ ~5 ^7 r9 e U! ]9 o7 |! Z4. Job creation continues to be strong (with a small lull in June); definitely# s" j& p5 B& M" Z7 y3 @" d
a sign of strong long-term fundamentals. RBC has also been following the job t+ I/ F4 t- x. N) R) O& L
creation situation and here is what they are saying: (www.rbc.com/economics)/ M3 }8 f, y, [: w9 ?6 j
"After generating a substantial 96,700 jobs in May, the largest such gain since4 Y% {. r) \9 a9 H4 Q) s- w
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 the7 g% ~8 E* x3 R9 _5 l4 X
first half of 2006, a feat not matched since the second half of 2002. With the
) ?- u7 R* O, h# z8 ^; `7 h0 zeconomy widely expected to grow at a more moderate pace in the second half of
1 a) [, y5 d l3 E2 r) {the year on the back of slowing trade activity, this impressive showing may not: c+ a o' n1 R: z
repeat itself. We expect that employment grew in July at a pace consistent with9 d/ j5 Q' Y! w* b5 ]0 z
its recent trend of 24,000 jobs a month. Assuming that the labour force grew at/ S! _( i1 \; y! N
its trend rate, a gain of 24,000 jobs will lead to a national unemployment rate; _3 S$ I3 D8 g0 c5 v$ _0 O
of 6.1%." Overall very good news. Now the key is to ensure that the region in
5 f* B3 y1 a5 Y8 q+ zwhich you are investing is continuing to generate jobs and increasing incomes. T8 i; l4 I. a/ k, i+ f/ P* B
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In other words, it is a great time to be taking advantage of this strong/ c# S# V$ s8 Q* R
economy, avoiding 'excuses' and to especially not listen to the uninformed' J( a* v) P$ _) W1 V; D
'dream stealers.' As long as you stick with your game plan, you continue to do
- L3 I1 `' ?" J+ W' R! U+ ~your due diligence, and you remove emotions from the equation, you will see the
7 ^: Y) v. y: x- F* T4 d l/ ]- i. dopportunities that are right in front of you, right here in Alberta. Let the
. M1 M' Q4 K! M2 R5 l. x" c'dream stealers' call you 'lucky' 5 years from now as your net worth has soared: e" W) q3 E0 r' V) n
and your financial freedom has surpassed even your wildest expectations.1 a( K- y4 [) e4 A
c3 |4 I. ] L+ n$ Y
- Y9 A# l' S- I4 UCapital Gains Comparison.4 T. ]) w( L) C, c+ S1 k
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KPMG has recently released a comparison of the true Top Federal and Provincial% {% G% f. B" \$ d
Marginal Capital Gains Tax Rates per province. It is very interesting to see
9 U) R- t* ?+ _how these will affect your exit strategy. Here are the numbers:
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BC . . . . . . . . 21.9%
' Y0 `6 X. v2 I( Z! u- I2 ?AB . . . . . . . . 19.5%
) I5 f# |0 B ~& |0 [- r0 @SK . . . . . . . . 22.0%
- e0 g3 o6 ]5 D2 R5 h2 @MB . . . . . . . . 23.2%
% D2 ~5 U4 |% b# P, UON . . . . . . . . 23.2%
& D5 [. a) k. ?( o8 L* u1 hQC . . . . . . . . 24.1%
. i+ a. }! L* t: O1 w4 v2 W* k" tNB . . . . . . . . 23.4%5 l- z' F4 m( a) y' c1 W+ M+ y
NS . . . . . . . . 24.1%
" V' B/ }/ L# ]. v5 Q; uPE . . . . . . . . 23.7%
: ~- V# i/ O, I% h7 B2 p5 ^7 b9 }NF . . . . . . . . 24.3%
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4 E7 b; w& A; v' p4 S7 oLower capital gains tax increases investment and stimulates the long term
/ h7 o3 e: B# x5 C. c# Y$ seconomy of the province. It also allows real estate investors to keep more of+ C. j5 g: z% t
their profits at exit time. Always a good number to pay attention to.( U+ `2 D; _9 C8 S$ _; ^, K
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( {2 i& P, b4 s( b2 {: |% A0 t/ l' b3 t9 T5 BOverall, by staying focused for the next short period of time, you have the8 A F0 N; F/ O0 ^7 d
opportunity to create financial freedom of which others can only dream. Of
' a. V$ N% p5 y+ e5 ?. Y9 m, Bcourse, the key word is focus. And with an August line-up of 'Members Only'
/ @6 e, n, T! D \# k$ Y* C& tevents like this, you can't help to become a real estate investment champion4 [; x+ e7 e/ K/ l# r, Y
when you take action as a full REIN Member.& t6 `; T Q! O
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Focus on the fundamentals, keep emotions out of your decisions, and enjoy the
* a* G) P" b0 Mresults in just a few short years. |
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发表于 2006-8-25 08:35
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