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NEW HOUSING PRICE INDEX...
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+ w% V* T% I" ]) \8 sThe New Housing Price Index, has just been released and it provides some very: O3 L+ m8 o4 Y6 R+ |5 ?
interesting insights, not only into where the market has moved, but where it
' m. J4 M; m8 f# A! O- l) Zwill be going.
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It 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( h2 C$ o8 X: C8 w
sophisticated investors to see how much the market has moved, as well as an
: t4 M x8 i; O; b0 q! Pindicator of where re-sale home prices will be moving in the coming six months.
7 A- o3 q, `$ k4 uWe look at the ripple effect that new housing prices have on re-sale property
. l" {. E2 q7 _8 l3 Xvalues and can extrapolate what direction re-sale prices will be moving and by1 f7 U0 A; @1 m6 c
how much.
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For instance, for the last three years, we have told investors to avoid Windsor,: o; V( S3 {) n
Ontario as an investment area because the underlying fundamentals are not very! v) @( K8 T8 h# I! P( Z
strong. This has been proven once again with the release of the latest: [0 r2 o/ c$ N% w& H3 c( v" l
findings. New Housing Prices have actually decreased by .5% during June 2005 -
% I0 k( r0 ^' I( c1 t3 rJune 2006 proving that fundamental investing works in helping you pick the best
1 P. T/ }. N. H, jmarkets and avoid the flat ones. This .5% decrease should have little impact
1 [, g, V* t8 M4 d# Eon average re-sale values in the Windsor region.
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1 ?* d0 w! t4 e9 a' W* p$ vTo contrast this, the fundamentals we discuss are so strong in Calgary that the! F9 k5 q4 p+ }" I$ o
market continues to be super heated. With close to 3,000 net new people into
+ o# b" X1 D4 ~the city every month, the property market just can't keep up. That is why we; d, b ^# c' U1 o! c* i9 L
saw the New Housing Price Index increase by 49.2% (June 2005 to June 2006).
( r$ C% G/ h" `" kThis is great news for the future of re-sale values in the city as these
* i9 ]# y! m* {" Iincreases will continue to ripple out into the market for at least the next six- \; _) I; f W, Q; x; U
months.
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Comparing these two regions is a great illustration of the value of not getting4 u; A E' }, k# W
caught in the 'emotional guessing game' by just focusing on the underlying5 K% q/ X" e$ s6 y
fundamentals. It is sad to see those people who said in the last 2 years that5 s; x+ |3 g4 R" N
the Alberta real estate market was over and they were going to sit back and wait+ j, x9 D0 Z8 m2 Z# R. y+ l
until it drops. Quite obviously, they have missed out on AMAZING gains, all3 ~% G2 R l0 X" Y
because they didn't follow fundamentals, they just led with their emotions.
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By the way, Edmonton's New Housing Price Index is up an amazing 28% so far (June
' G3 F) O- H$ Z1 v% M* j4 D, e+ ^% {2005 to June 2006), also great news.
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By comparison across the country, these are the numbers for June 2005 - June
# {( o- T# \5 A8 v+ k2 G0 A6 g2006 New Housing Price Index for:' _' d4 x" Y4 n4 {; f+ M: ~
" m) W" ^' V. h% B; fVancouver . . . . . . . . +5.2%# w: E# G' W. y# E8 ~; k1 Z
Saskatoon . . . . . . . . +8.5%
7 K% W# H E' E, e2 e* b3 _London . . . . . . . . . . . +3.0%1 @$ s. n6 m ^0 p. H' {9 a: S0 I7 R- J
Hamilton . . . . . . . . . . +4.9%$ A1 ]# d( d/ m1 D1 e( a7 q* H. b
St. Catharines - Niagara . . . . +4.9%
/ i2 e7 ]8 Q6 q" uToronto and Oshawa . . . . . . . +3.2
" I% C+ [+ n: I& \) kOttawa - Gatineau . . . . . . . . . +3.1%# f" c# c- R: {& h) F) p
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Fundamental investing ALWAYS makes you look like a genius - emotional investing
1 o$ {% }; R$ n! W$ |: pgives 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 to
! F9 x- h) J, @: d1 P9 ^be strong, as in-migration and job creation continues to attract people from not. Q4 m( ? _) s: q9 c3 ?7 p
only across Canada, but from around the world. Our average wages are
6 e, H: U1 W5 H# C3 ]4 Z0 Gincreasing, our population is increasing, our unemployment rate continues to& p4 m+ F% O6 F. H7 d: s2 G5 F: m
drop and our GDP growth is slated to once again lead the country.& Z' v( V W* ?! J$ c5 L D) M+ q
: ?0 B& X# k# H& @8 I5 lHere are some very interesting facts that are helping to support the strong
' v7 |: U/ k+ S5 e, k3 lfundamentals:
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1. The Conference Board of Canada is forecasting strong economic growth in
" G; n2 m" z) H0 i0 CCanada, with Alberta once again leading the way. In fact, the projected growth
# i2 M7 T% T; Y) d) ]: N8 F8 d8 }for Alberta's economy is a staggering 6.6%. (BC + 3.6%, Ontario + 2.5%), and" J" z5 m U! z* N+ {4 @" K) l: s
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
, {* u4 p Y1 ^: Y zworld. Recently, there have been investors coming here from Asia, Australia,
6 a9 m' ]7 c& o1 y) Y7 u w; Sthe US, UK and Europe. In fact, if you review the world's press you will see" C' u) I2 m; O9 w& ~9 V
that Canada (with a focus on Alberta) is being discussed more frequently.
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3. Don Campbell has just returned from presenting our Canadian investment
, t! N4 K' Z! @' n8 Patmosphere (including Why Alberta - Why Now") to a group of major investors in3 p& m: E+ @7 T' t
Dublin, Ireland, and the response was overwhelmingly positive. In fact, after
' E) q8 K; V' Y' ?Don presented the economic facts, many of these investors (who could invest6 u1 k% R! I; ?$ j3 S! m3 E
anywhere in the world) have already booked their flights to here. Once again
5 M+ S8 l, N) u+ t u- E( rproving that when the true numbers of our economy are presented (along with the6 _$ k* G% L) W7 v: B7 G ?6 n, J5 C
political stability of our country), there is no place in the world that can0 f, U" e% _0 l1 V9 r5 ^
beat it for long term investment.6 R/ n. {. K3 f; G
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4. Job creation continues to be strong (with a small lull in June); definitely$ F4 e; w" ?" G1 R/ i) A" H
a sign of strong long-term fundamentals. RBC has also been following the job9 w X. m$ h7 d+ |! J5 n
creation situation and here is what they are saying: (www.rbc.com/economics)" b) B5 z7 n2 X+ i H
"After generating a substantial 96,700 jobs in May, the largest such gain since) d @( p5 p5 Z" x" w0 p- H4 ^
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
1 k, l5 s+ W4 x6 Hfirst half of 2006, a feat not matched since the second half of 2002. With the
8 z! X. U2 Z$ x zeconomy widely expected to grow at a more moderate pace in the second half of3 G- d: k/ p- I' d _
the year on the back of slowing trade activity, this impressive showing may not
& ^6 D) S b, _1 P0 X% hrepeat itself. We expect that employment grew in July at a pace consistent with
+ m/ M G4 S. s0 qits recent trend of 24,000 jobs a month. Assuming that the labour force grew at
. Z/ `7 w9 m: \+ L4 ]its trend rate, a gain of 24,000 jobs will lead to a national unemployment rate
. C" e% A! g# X2 mof 6.1%." Overall very good news. Now the key is to ensure that the region in* w \( R$ Q2 y& _9 n/ r# m
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
9 k4 J( A* Y9 ~, seconomy, avoiding 'excuses' and to especially not listen to the uninformed0 F5 o+ o, t* k$ s
'dream stealers.' As long as you stick with your game plan, you continue to do R& ? j" T: E. T. m
your due diligence, and you remove emotions from the equation, you will see the4 m0 Q8 J% c) O) [( ~2 w# c
opportunities that are right in front of you, right here in Alberta. Let the3 c. M( z; e' O6 a K/ l4 F# `2 K8 x
'dream stealers' call you 'lucky' 5 years from now as your net worth has soared
8 t& I' j- h" \" [- L% W" C& land your financial freedom has surpassed even your wildest expectations.
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3 c3 j# G0 c: H& |Capital Gains Comparison.
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# {7 f; y E8 {7 p$ Y) MKPMG has recently released a comparison of the true Top Federal and Provincial+ p% u m' N4 L6 @- r
Marginal Capital Gains Tax Rates per province. It is very interesting to see
0 D" F* K: V1 Thow these will affect your exit strategy. Here are the numbers:
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$ v5 d, ^; f$ F0 e" Q. z; kBC . . . . . . . . 21.9%
3 ~' i" G; T7 K3 b/ |3 CAB . . . . . . . . 19.5%0 d1 h4 j) M! b! ], x7 w5 t% L
SK . . . . . . . . 22.0%
+ }2 z# d* a1 L- _) l4 j6 e- RMB . . . . . . . . 23.2%! F$ \ X9 m2 B9 @0 J: T- w
ON . . . . . . . . 23.2%% _' N! X$ w5 @ k' H6 a! l
QC . . . . . . . . 24.1%
: U2 m1 X9 }; J, @7 F) h! uNB . . . . . . . . 23.4%
& A" c$ J) |4 X$ D/ x7 Z* bNS . . . . . . . . 24.1%
5 r2 C2 q3 e) W5 U) N, f7 |PE . . . . . . . . 23.7%
& O6 i h3 c$ L' lNF . . . . . . . . 24.3%0 }* x6 ~/ n2 K
2 P+ a% R7 O2 T+ G9 F2 H2 C# BLower capital gains tax increases investment and stimulates the long term. a- ^2 L4 I u
economy of the province. It also allows real estate investors to keep more of j$ c4 A1 C: U. L8 h
their profits at exit time. Always a good number to pay attention to.
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& B! j2 N! `! W1 M% Z. POverall, by staying focused for the next short period of time, you have the- t, t1 r+ n6 s! W* f
opportunity to create financial freedom of which others can only dream. Of
( d# e, m" A9 y) @& ucourse, the key word is focus. And with an August line-up of 'Members Only', c/ y J9 j1 J4 x
events like this, you can't help to become a real estate investment champion. U& L/ P; e6 u( `$ u) E3 p
when you take action as a full REIN Member.
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) A N3 Q0 I9 P' ]! B; _( mFocus on the fundamentals, keep emotions out of your decisions, and enjoy the! Z8 c5 T* `2 b; N
results in just a few short years. |
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发表于 2006-8-25 08:35
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