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NEW HOUSING PRICE INDEX...6 Q) y* G( y H' B9 a
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The New Housing Price Index, has just been released and it provides some very! J# t. J8 V& X1 U8 e" K4 _
interesting insights, not only into where the market has moved, but where it/ `! k# x* J; K$ ?- R
will be going.0 d$ ^, H3 h+ m. E
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It proved, once again, the value of looking at fundamentals behind a market.9 Q7 h# ~6 l7 u3 N) i/ m
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The New Housing Price Index is compiled by Statistics Canada and is used by# `3 i, V& C8 ~2 p }
sophisticated investors to see how much the market has moved, as well as an- C& J. |& X$ K7 L4 Y6 ~
indicator of where re-sale home prices will be moving in the coming six months. ' P; ]/ |' `. f" v) C
We look at the ripple effect that new housing prices have on re-sale property0 D4 R- ?& N3 {3 a; \0 q* Q
values and can extrapolate what direction re-sale prices will be moving and by3 `: T" s8 |0 R% z3 r# l
how much. f- M, H- Z" O, v! R( j* L; o$ N
& i* R% B+ Z2 z z9 @For instance, for the last three years, we have told investors to avoid Windsor,
* x( \; i. V: o hOntario as an investment area because the underlying fundamentals are not very: K& H _- N( i* f/ r' _5 q
strong. This has been proven once again with the release of the latest
. K3 H, z& B" J: O n% rfindings. New Housing Prices have actually decreased by .5% during June 2005 -
9 G8 u; R0 U+ R1 K+ qJune 2006 proving that fundamental investing works in helping you pick the best
; k) D4 N2 C7 Amarkets and avoid the flat ones. This .5% decrease should have little impact- I2 P; _9 A+ K, S! |
on average re-sale values in the Windsor region.
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0 Q. @. d# C, |9 z' ?' v1 k4 @+ {To contrast this, the fundamentals we discuss are so strong in Calgary that the' [ f) M: t V) _+ F: V# S
market continues to be super heated. With close to 3,000 net new people into$ u7 X# w8 h3 s& N, n- Q! a) t
the city every month, the property market just can't keep up. That is why we3 p( }9 I+ H6 X& H
saw the New Housing Price Index increase by 49.2% (June 2005 to June 2006).
% P3 t' }3 v. D# v/ OThis is great news for the future of re-sale values in the city as these9 ^7 `2 W# ?8 t1 s/ i
increases will continue to ripple out into the market for at least the next six: R" T+ B& A9 }5 ^, o
months. , y. P/ u* P. }8 g1 v8 Y
/ `. W$ n5 Y x3 `Comparing these two regions is a great illustration of the value of not getting$ E6 @' D% w# A& D1 r
caught in the 'emotional guessing game' by just focusing on the underlying' ]- k6 ^( l4 b" Q- k6 F" ^$ B6 q
fundamentals. It is sad to see those people who said in the last 2 years that* c$ n" W) b) H7 }- ~/ b* O
the Alberta real estate market was over and they were going to sit back and wait
k# g& K; y( W3 v0 i5 E$ @until it drops. Quite obviously, they have missed out on AMAZING gains, all
8 E/ G# B/ X! G3 q" B: Bbecause they didn't follow fundamentals, they just led with their emotions.3 \* ^& w# Z1 U0 G! \0 `
1 k9 G; x l: A8 l8 TBy the way, Edmonton's New Housing Price Index is up an amazing 28% so far (June
- g) j# t+ R) E! x! ?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% x; H" s/ m3 ^
2006 New Housing Price Index for:( w$ j9 G' z) n4 V2 Z6 t
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Vancouver . . . . . . . . +5.2%1 g9 j% a' H& u/ Y$ g/ @2 B6 O
Saskatoon . . . . . . . . +8.5%
% g7 ^& Q& S6 J3 A) h- }London . . . . . . . . . . . +3.0%
% }3 b* w" ?; w$ [- Y$ G4 jHamilton . . . . . . . . . . +4.9%, w* v' ~- j6 ]/ ?) K; J! Q
St. Catharines - Niagara . . . . +4.9%6 W1 k( `; W3 Z4 x4 Y& j! u
Toronto and Oshawa . . . . . . . +3.2
$ }) h$ }, j+ w/ O: hOttawa - Gatineau . . . . . . . . . +3.1%6 J5 f# C5 q, n6 _# F. N
$ l7 _1 [# x7 C0 e, g3 ~Fundamental investing ALWAYS makes you look like a genius - emotional investing
4 a0 L) o4 d4 {; Qgives you quick highs, but also quick lows. Well done on your focus!
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; B+ r9 j( h& [As the fundamentals have been showing all along, the Alberta market continues to# L! o% ]+ l5 n
be strong, as in-migration and job creation continues to attract people from not7 e) _0 z& g) s/ N) s* U; R B* ^
only across Canada, but from around the world. Our average wages are
% L. K& V, ` v$ R4 lincreasing, our population is increasing, our unemployment rate continues to
! D5 A" h/ _" e! _% a, vdrop 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
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1. The Conference Board of Canada is forecasting strong economic growth in$ H7 X! q f! U! W$ B6 T; r% M( a, D
Canada, with Alberta once again leading the way. In fact, the projected growth, W) N0 u0 m* g/ T
for Alberta's economy is a staggering 6.6%. (BC + 3.6%, Ontario + 2.5%), and+ }; @. d! x1 z4 n; ~
this is slated to occur even with the labour shortages we are witnessing.
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' R6 W1 b1 H4 Y2. People are discovering Canada as an investment center from all over the4 z* u q& l* j* }
world. Recently, there have been investors coming here from Asia, Australia,& Q5 _( {& f# W! E9 @/ f3 s0 ^* E
the US, UK and Europe. In fact, if you review the world's press you will see
$ W$ q h8 {9 F( `" kthat 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
9 a- I" v( U! w, ~atmosphere (including Why Alberta - Why Now") to a group of major investors in9 A l5 o3 \3 x. p- |3 w9 A: D- V
Dublin, Ireland, and the response was overwhelmingly positive. In fact, after9 U! U6 m R; D- x% L# T/ l
Don presented the economic facts, many of these investors (who could invest. E* \9 d+ E+ r
anywhere in the world) have already booked their flights to here. Once again2 `) U* w3 Z# t. a/ _
proving that when the true numbers of our economy are presented (along with the8 F& x* L1 h+ V, F) w
political stability of our country), there is no place in the world that can
- W" q; |; W% H. r9 V2 V2 |$ ybeat it for long term investment.
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4. Job creation continues to be strong (with a small lull in June); definitely
1 n0 T/ x, y! A7 Ta sign of strong long-term fundamentals. RBC has also been following the job
( N1 L: O' H5 D! v8 f$ Kcreation situation and here is what they are saying: (www.rbc.com/economics)
5 a p7 t- f8 K4 O1 r" P, g"After generating a substantial 96,700 jobs in May, the largest such gain since' i' x- H7 y" I- t: ^
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
! V J9 h5 f9 Z/ Vfirst half of 2006, a feat not matched since the second half of 2002. With the
1 w& {% l6 j& M# oeconomy widely expected to grow at a more moderate pace in the second half of
' U7 q& E9 E1 Y3 @3 ~( Hthe year on the back of slowing trade activity, this impressive showing may not, m1 g [7 ~; Q0 F! p
repeat itself. We expect that employment grew in July at a pace consistent with6 e- U) K; V# d) z$ l4 S
its recent trend of 24,000 jobs a month. Assuming that the labour force grew at* B+ D1 P: G0 I% o
its trend rate, a gain of 24,000 jobs will lead to a national unemployment rate ]* u7 r; d6 p& w d o u
of 6.1%." Overall very good news. Now the key is to ensure that the region in
! r2 c; x) W; A7 v9 h3 H! ewhich you are investing is continuing to generate jobs and increasing incomes.( f% E" p i: e, ]
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6 }* g" j" k; m" a$ x7 uIn other words, it is a great time to be taking advantage of this strong
! W. K6 s* L/ p4 r& z: ~7 M, ceconomy, avoiding 'excuses' and to especially not listen to the uninformed6 e$ U k& h7 Y4 `
'dream stealers.' As long as you stick with your game plan, you continue to do$ ~2 u9 e/ t$ u. F: D
your due diligence, and you remove emotions from the equation, you will see the
1 [ D. Y4 \! {- k/ topportunities that are right in front of you, right here in Alberta. Let the
' N/ V: z( J G8 a* w P'dream stealers' call you 'lucky' 5 years from now as your net worth has soared
& P9 r1 U- c" hand your financial freedom has surpassed even your wildest expectations.
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Capital Gains Comparison.
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KPMG has recently released a comparison of the true Top Federal and Provincial
. ~5 X7 [( J( {4 E, D3 G) q9 Q; yMarginal Capital Gains Tax Rates per province. It is very interesting to see
9 V" r* L* u$ s. V* j- uhow these will affect your exit strategy. Here are the numbers:
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6 Y. A; |6 Z7 l C. N( hBC . . . . . . . . 21.9%7 F6 o( T& u2 x+ @/ t# I
AB . . . . . . . . 19.5%
/ f8 P9 C8 h1 I1 f9 nSK . . . . . . . . 22.0%
5 C( N4 t6 m( Y0 C: E# sMB . . . . . . . . 23.2%2 x$ i! r% G1 ^0 r0 {# W! L9 b
ON . . . . . . . . 23.2%
/ x: X" e+ m' \6 J5 t$ JQC . . . . . . . . 24.1%$ b. ~# t9 a" [3 |0 l- n1 L( T2 Z! {! b
NB . . . . . . . . 23.4%
3 h& s+ \5 G/ I: TNS . . . . . . . . 24.1%
2 _$ x2 R3 v' t3 C* x. APE . . . . . . . . 23.7%. x6 X+ h+ k0 h! T8 \
NF . . . . . . . . 24.3%# ?* z9 C; M# N$ O
7 l9 O* g7 x% w) q/ OLower capital gains tax increases investment and stimulates the long term5 y" U- ^& T5 y- t6 c
economy of the province. It also allows real estate investors to keep more of6 b5 J, h6 U, S
their profits at exit time. Always a good number to pay attention to.2 Z: O, r0 ?4 z' d9 h( g4 q! N
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" ], A- i5 e# n( MOverall, by staying focused for the next short period of time, you have the( L4 V" W9 [- n& m! H( G
opportunity to create financial freedom of which others can only dream. Of
# ?& D j# X& ccourse, the key word is focus. And with an August line-up of 'Members Only'! o8 z+ I( m1 }/ z
events like this, you can't help to become a real estate investment champion/ E; K' G, o: a2 f
when you take action as a full REIN Member.
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% y+ u) U6 X* G1 YFocus on the fundamentals, keep emotions out of your decisions, and enjoy the
1 t3 q. s0 _0 [: X- T1 N# uresults in just a few short years. |
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发表于 2006-8-25 08:35
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