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NEW HOUSING PRICE INDEX...
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+ Z+ Z2 O [ UThe New Housing Price Index, has just been released and it provides some very' }, S9 v8 L' t& D2 t7 ?4 v/ `7 ?
interesting insights, not only into where the market has moved, but where it4 k' j7 o' a- N- _ a
will be going." s+ L- P6 ~ B6 R
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It proved, once again, the value of looking at fundamentals behind a market.2 M6 B6 I Y9 ?! T( d. y1 T
# h4 t2 s- M8 s$ D/ @The New Housing Price Index is compiled by Statistics Canada and is used by4 @$ }, n- Q$ Q8 d
sophisticated investors to see how much the market has moved, as well as an2 B! F( V% T D4 K t& A$ {
indicator of where re-sale home prices will be moving in the coming six months.
: r4 t) v' W! O3 o) ^/ R# ?" a3 F7 nWe look at the ripple effect that new housing prices have on re-sale property
7 i5 ?9 } P& M N) A Q6 W9 ~4 i0 |) f @values and can extrapolate what direction re-sale prices will be moving and by
/ d3 k! K/ i" g5 R# Hhow much.8 n) ~! D6 h+ R9 \6 A J
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For instance, for the last three years, we have told investors to avoid Windsor,
2 w1 q2 W8 c" o# t8 Z0 S8 m5 cOntario as an investment area because the underlying fundamentals are not very% H6 V0 j1 R) o3 r+ u, q5 {+ ?, [! [
strong. This has been proven once again with the release of the latest
0 ^. {2 V/ ^3 M, z3 M* f3 M4 \findings. New Housing Prices have actually decreased by .5% during June 2005 -
8 {* T8 v2 W( v& HJune 2006 proving that fundamental investing works in helping you pick the best
3 z. H) d; l9 e6 e/ s. Pmarkets and avoid the flat ones. This .5% decrease should have little impact% [/ E* q% U. x2 @1 E, F- r! A
on average re-sale values in the Windsor region.
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G0 i2 U5 u$ x o" G1 ?# T" V# DTo contrast this, the fundamentals we discuss are so strong in Calgary that the5 a* D. I: M+ P
market continues to be super heated. With close to 3,000 net new people into! F6 R& c8 n* p ~0 I
the city every month, the property market just can't keep up. That is why we
" q6 f+ Z, Y; `. ssaw the New Housing Price Index increase by 49.2% (June 2005 to June 2006). * u) l& _* b5 r5 `5 Q c8 L
This is great news for the future of re-sale values in the city as these
1 b5 N& Y4 N. \increases will continue to ripple out into the market for at least the next six+ T/ C% t1 @0 t
months. & I4 `& x& g9 X, r$ q" }
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Comparing these two regions is a great illustration of the value of not getting# F6 r& S' D% ?. u; V
caught in the 'emotional guessing game' by just focusing on the underlying
/ O; g; S s9 n" ^' Cfundamentals. It is sad to see those people who said in the last 2 years that K3 G" P& H [+ L* h
the Alberta real estate market was over and they were going to sit back and wait( ] h8 e x& t; c
until it drops. Quite obviously, they have missed out on AMAZING gains, all
' j& z% l7 V6 O7 D: @because they didn't follow fundamentals, they just led with their emotions.- Q6 n9 ?& C. ]2 i+ B
M) F* Z2 x! }& ^# sBy the way, Edmonton's New Housing Price Index is up an amazing 28% so far (June5 s5 A. \1 r. l2 K( Q( ^! u
2005 to June 2006), also great news.- y7 A4 X/ `2 L1 m; h5 c: T1 W2 ?
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By comparison across the country, these are the numbers for June 2005 - June
p, ?7 P* n! @2 y# G: k8 Y2006 New Housing Price Index for:# Q. o6 l% f6 S
" r4 n- u' c+ t( b6 r9 N2 y1 bVancouver . . . . . . . . +5.2%
1 N/ ^; u# N( p2 X$ s/ rSaskatoon . . . . . . . . +8.5%
' d- Q9 Z5 j. r) vLondon . . . . . . . . . . . +3.0%6 R( a" m9 b. Z/ u- Z: K3 G7 N5 T
Hamilton . . . . . . . . . . +4.9%- D+ D, S: ?- f/ Z$ N E1 S$ Y3 A% ^
St. Catharines - Niagara . . . . +4.9%0 L Z5 N" y) k& Y9 R: J/ y; i9 \3 X$ W+ A
Toronto and Oshawa . . . . . . . +3.2
6 w" W2 k6 l9 O( YOttawa - Gatineau . . . . . . . . . +3.1%
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. S1 i1 W! e; w1 _) [/ n6 Z% }6 WFundamental investing ALWAYS makes you look like a genius - emotional investing
8 ]! f! O1 w- ?! Egives you quick highs, but also quick lows. Well done on your focus!! s- I3 `" c* c7 g! v7 @& y
. |4 X) m5 I+ n* ~" xAs the fundamentals have been showing all along, the Alberta market continues to
' M- d ]9 x' e8 H9 n: C9 d2 z, ]2 Dbe strong, as in-migration and job creation continues to attract people from not1 c9 t. v. q. r6 I( @8 N8 J
only across Canada, but from around the world. Our average wages are; `. D8 f3 @. K4 a2 @& Y9 @
increasing, our population is increasing, our unemployment rate continues to: K5 T! P8 ?2 W; }9 N. K1 w
drop and our GDP growth is slated to once again lead the country.& |6 P; }( i- M; K8 }
3 S( F4 v: n4 s/ R4 `1 d5 BHere are some very interesting facts that are helping to support the strong
/ z$ b: X3 O1 L4 zfundamentals:
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% A0 g7 o2 E0 [ s( n1. The Conference Board of Canada is forecasting strong economic growth in
- I$ L- \# x/ @& `9 m2 @+ OCanada, with Alberta once again leading the way. In fact, the projected growth+ |8 J* Z. Y, d# k7 w6 ]3 w! s6 g
for Alberta's economy is a staggering 6.6%. (BC + 3.6%, Ontario + 2.5%), and, Y) E3 k2 q5 ~( x
this is slated to occur even with the labour shortages we are witnessing.
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2. People are discovering Canada as an investment center from all over the; T) w- }% T/ ~# K M
world. Recently, there have been investors coming here from Asia, Australia,0 e" ]! }; v- G
the US, UK and Europe. In fact, if you review the world's press you will see
8 W; V2 w+ \- R7 }5 F4 Othat Canada (with a focus on Alberta) is being discussed more frequently. % G% i2 O7 t4 }/ }: I1 i
, @& \- D5 N; U; A1 t, E* `3. Don Campbell has just returned from presenting our Canadian investment/ G" J; ?! E& r
atmosphere (including Why Alberta - Why Now") to a group of major investors in+ _4 \( P$ Y& Q9 n0 O
Dublin, Ireland, and the response was overwhelmingly positive. In fact, after
2 B1 G: u0 D) _1 j' K$ E0 BDon presented the economic facts, many of these investors (who could invest- p2 F( f' V, h5 |0 m5 r$ M& p j @
anywhere in the world) have already booked their flights to here. Once again
' m) `0 [* h5 l' |) N: w. q8 oproving that when the true numbers of our economy are presented (along with the
. C1 H6 f# D2 m0 o* w. ?political stability of our country), there is no place in the world that can
8 X& x( C- {" P3 g6 d8 ubeat it for long term investment.
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4. Job creation continues to be strong (with a small lull in June); definitely
. i; C c) X% la sign of strong long-term fundamentals. RBC has also been following the job% P L* n8 S1 X# P0 T- T0 W$ `& N1 h5 i
creation situation and here is what they are saying: (www.rbc.com/economics)
+ x, l% H' t) o* o6 p: ?"After generating a substantial 96,700 jobs in May, the largest such gain since( }8 g) c; k5 F
January 2002, the economy lost a modest 4,600 jobs in June... - ?! f- ^4 p' K2 c0 d
+ d& M3 G5 v$ QStrength in the Canadian economy contributed to a gain of 215,600 jobs in the) K( x7 i% W# Q2 {& W4 u. d
first half of 2006, a feat not matched since the second half of 2002. With the, S Y( P, o* I. [8 ?
economy widely expected to grow at a more moderate pace in the second half of' s; I# P% u* w6 a
the year on the back of slowing trade activity, this impressive showing may not( c5 ~ ]7 S) n2 X$ V4 R8 X7 C
repeat itself. We expect that employment grew in July at a pace consistent with
9 t0 b: T @9 R5 `8 X3 R1 O. gits recent trend of 24,000 jobs a month. Assuming that the labour force grew at( q! K7 S$ _" B @9 ?
its trend rate, a gain of 24,000 jobs will lead to a national unemployment rate
9 E8 u3 H7 d; {* dof 6.1%." Overall very good news. Now the key is to ensure that the region in8 J- H$ {# t- V
which you are investing is continuing to generate jobs and increasing incomes.
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, k/ r, C/ }, [' ^: ?In other words, it is a great time to be taking advantage of this strong9 |; u7 g5 U, i. _
economy, avoiding 'excuses' and to especially not listen to the uninformed+ [; H% w- Q F2 _ Y( g: n* ?2 a
'dream stealers.' As long as you stick with your game plan, you continue to do# E7 y1 ^! S R! z- x" g3 O2 N! \
your due diligence, and you remove emotions from the equation, you will see the" C) |% c2 z: _. v) ]6 T
opportunities that are right in front of you, right here in Alberta. Let the
2 s4 K2 u2 E$ ]' s0 e8 X'dream stealers' call you 'lucky' 5 years from now as your net worth has soared
. p( P% v9 ~+ F [" [" Band your financial freedom has surpassed even your wildest expectations.
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Capital Gains Comparison.
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4 B0 j# m. N3 ^6 n/ H* t% qKPMG has recently released a comparison of the true Top Federal and Provincial
- l9 x9 ^+ b2 l0 KMarginal Capital Gains Tax Rates per province. It is very interesting to see
( ], L$ b; a$ d; p' S9 Z; Yhow these will affect your exit strategy. Here are the numbers:7 ^( E+ c* |4 v0 `6 I
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BC . . . . . . . . 21.9%
/ [; }0 S2 E+ w* AAB . . . . . . . . 19.5%
4 o2 Y1 `0 D/ d- X' O* xSK . . . . . . . . 22.0%
. S+ L& P7 l; q% u* K# [: RMB . . . . . . . . 23.2%
- u8 s1 c* s/ K% c l$ ION . . . . . . . . 23.2%
4 `8 n! p. C" r* r$ aQC . . . . . . . . 24.1%
' [6 d& g, \- i" `& Z6 Y; |NB . . . . . . . . 23.4%
! K( K1 X! P/ m' r' V9 iNS . . . . . . . . 24.1%
. P/ ^, h6 r# a; _" dPE . . . . . . . . 23.7%* J7 v3 P9 V* C
NF . . . . . . . . 24.3%9 _0 r8 r8 Z7 y- T4 b7 ^
: C0 q. t# ]1 k/ L3 m( q) H( mLower capital gains tax increases investment and stimulates the long term
* ~, w3 o0 { ]5 U. _& _% v" \& ceconomy of the province. It also allows real estate investors to keep more of
q! Y7 E7 u) jtheir profits at exit time. Always a good number to pay attention to.
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; G8 m" f- Y! v) b- N0 f8 wOverall, by staying focused for the next short period of time, you have the
. B+ `# \: `7 s4 N+ Oopportunity to create financial freedom of which others can only dream. Of# |4 p7 g0 q9 Y
course, the key word is focus. And with an August line-up of 'Members Only'
. _5 M* l) Q2 Gevents like this, you can't help to become a real estate investment champion. [- Z: E5 I d! J8 v' i
when you take action as a full REIN Member.
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m3 t& @0 K e; U# t# h7 v9 \8 g# JFocus on the fundamentals, keep emotions out of your decisions, and enjoy the
" x2 x- ], l6 Yresults in just a few short years. |
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发表于 2006-8-25 08:35
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