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NEW HOUSING PRICE INDEX...- v0 N6 n! A: P4 [
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/ j. \0 q# q+ d7 rThe New Housing Price Index, has just been released and it provides some very
; [" `. d" X; b/ z9 |interesting insights, not only into where the market has moved, but where it, g4 z2 c! G& i5 N
will be going.
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0 Q" `# @; N: N, G+ r E3 [0 BIt proved, once again, the value of looking at fundamentals behind a market.
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/ a& ]' f5 ~" c2 zThe New Housing Price Index is compiled by Statistics Canada and is used by
R/ d, b$ i* \* jsophisticated investors to see how much the market has moved, as well as an/ |$ K1 l! s q( U
indicator of where re-sale home prices will be moving in the coming six months.
& t5 x5 P' F2 P. ~) k1 U+ K7 vWe look at the ripple effect that new housing prices have on re-sale property
: S/ Y) o$ K" f% e# e/ Fvalues and can extrapolate what direction re-sale prices will be moving and by
7 U( ^) J8 t) D: J- H6 Ihow much.
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For instance, for the last three years, we have told investors to avoid Windsor,
, E- K2 c! y \5 sOntario as an investment area because the underlying fundamentals are not very7 {4 O9 p$ b- \- w m0 b
strong. This has been proven once again with the release of the latest
3 ]: g% o3 Z9 Q' Bfindings. New Housing Prices have actually decreased by .5% during June 2005 -# {. _2 U" H$ `. m5 g0 ~
June 2006 proving that fundamental investing works in helping you pick the best! N! H6 ]& q* \
markets and avoid the flat ones. This .5% decrease should have little impact
. D7 }0 i0 |5 K* ron average re-sale values in the Windsor region.7 ^# }" j2 k5 ]
0 ], H) b+ ^+ D$ V! u; l* r8 q6 rTo contrast this, the fundamentals we discuss are so strong in Calgary that the$ ^8 a5 S$ ~/ F% G/ h. Q
market continues to be super heated. With close to 3,000 net new people into
$ `( }6 [: h0 B# }/ ethe city every month, the property market just can't keep up. That is why we
b/ `7 ~; K5 ]! ?saw the New Housing Price Index increase by 49.2% (June 2005 to June 2006).
5 i2 F! L) N) PThis is great news for the future of re-sale values in the city as these3 y8 q# \9 y. |% N+ k$ c. K- Y' e
increases will continue to ripple out into the market for at least the next six9 c- S1 H9 J+ l! R: r6 Y1 J
months.
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Comparing these two regions is a great illustration of the value of not getting
7 y5 ~: w- r0 z4 g9 h1 Mcaught in the 'emotional guessing game' by just focusing on the underlying
* y9 f* ~1 Z1 J8 a! W% a4 qfundamentals. It is sad to see those people who said in the last 2 years that! U$ I1 A; D" H$ a8 u
the Alberta real estate market was over and they were going to sit back and wait
1 z; g! F" A0 h: ^( D& }2 k- I. Kuntil it drops. Quite obviously, they have missed out on AMAZING gains, all
0 r l+ N* B1 v9 K( Pbecause they didn't follow fundamentals, they just led with their emotions.3 e: q9 i9 k. T
3 J' E, S, J- U, v* Q0 W9 r- [( ]. b: ^By the way, Edmonton's New Housing Price Index is up an amazing 28% so far (June
. G& F6 C6 ^6 D* _/ Y4 b2005 to June 2006), also great news.
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1 e/ D k# G$ X- [( M" N2 u8 ?By comparison across the country, these are the numbers for June 2005 - June
7 a& \7 i7 n1 Q2006 New Housing Price Index for:
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& L4 i7 \4 B/ {/ i/ Q j4 WVancouver . . . . . . . . +5.2%
; v1 ]* L: g) g8 V) wSaskatoon . . . . . . . . +8.5%% x! ^9 h6 b5 @3 r1 Q% U9 D2 B3 Z
London . . . . . . . . . . . +3.0%
2 g% |1 ?: u3 |4 Y2 N/ ~Hamilton . . . . . . . . . . +4.9%8 X) \1 W, L1 K: F6 a- }
St. Catharines - Niagara . . . . +4.9%: {' L9 a, R2 \
Toronto and Oshawa . . . . . . . +3.2
: ]& x5 ?8 W) X5 k2 l* ]2 eOttawa - Gatineau . . . . . . . . . +3.1%
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, o$ N, o+ j7 [8 \Fundamental investing ALWAYS makes you look like a genius - emotional investing
6 z' V" l1 r. _$ }1 jgives you quick highs, but also quick lows. Well done on your focus!
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$ ?: R0 L* ~. z7 a* n/ D! g! O* f% c7 tAs the fundamentals have been showing all along, the Alberta market continues to
0 B5 q* {% X& G$ x+ h. d! K8 @be strong, as in-migration and job creation continues to attract people from not9 p7 O. m4 ~' n C) \7 i
only across Canada, but from around the world. Our average wages are! M n/ q# H' l
increasing, our population is increasing, our unemployment rate continues to* v0 A* ]$ [6 h; S' j5 H# w
drop and our GDP growth is slated to once again lead the country." g# H4 B3 z) t8 r1 V
/ ? Z, ^. p! S# t0 n0 j/ o" H5 DHere are some very interesting facts that are helping to support the strong) i' r3 o: Q& u- Y) X
fundamentals:; D# H" k! }7 M3 i, V$ Z9 P
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1. The Conference Board of Canada is forecasting strong economic growth in
5 e: B- X; p6 ZCanada, with Alberta once again leading the way. In fact, the projected growth N# x3 Z" `# X- y* A
for Alberta's economy is a staggering 6.6%. (BC + 3.6%, Ontario + 2.5%), and! P3 g- k, J- L3 C7 {3 W
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! h) F* z4 V% D! {
world. Recently, there have been investors coming here from Asia, Australia,
- b0 i) G4 D- R% Y F0 g- ]+ Vthe US, UK and Europe. In fact, if you review the world's press you will see7 v! f% r8 y3 x4 y" }$ g# G
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( e6 b8 I* I X3 o$ }
atmosphere (including Why Alberta - Why Now") to a group of major investors in
! p9 b7 R% c5 QDublin, Ireland, and the response was overwhelmingly positive. In fact, after
0 ^- c( B, W& S$ @Don presented the economic facts, many of these investors (who could invest
. b$ D% n* I0 danywhere in the world) have already booked their flights to here. Once again
+ L* |# o8 u+ d/ C/ zproving that when the true numbers of our economy are presented (along with the6 T) C" f$ _0 q! {1 \
political stability of our country), there is no place in the world that can
$ M, ^3 E' z: {; Rbeat it for long term investment.
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8 S, b4 J" [3 A# r4. Job creation continues to be strong (with a small lull in June); definitely6 u: B! a, @" _% {. D
a sign of strong long-term fundamentals. RBC has also been following the job
% _3 n$ e7 n2 F/ _! k9 f+ M9 wcreation situation and here is what they are saying: (www.rbc.com/economics)
, |6 E6 i" F, l" F, F1 N"After generating a substantial 96,700 jobs in May, the largest such gain since
) F4 ?* m* M- `7 V5 c N6 DJanuary 2002, the economy lost a modest 4,600 jobs in June...
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6 A- K3 M6 o8 e7 \Strength in the Canadian economy contributed to a gain of 215,600 jobs in the
; W$ V) z: I6 @; B) J, Dfirst half of 2006, a feat not matched since the second half of 2002. With the' Z2 ]5 Z0 \: x
economy widely expected to grow at a more moderate pace in the second half of7 U$ M) _4 B& i. w
the year on the back of slowing trade activity, this impressive showing may not
: {; z* Z9 y2 u! N& l) ]repeat itself. We expect that employment grew in July at a pace consistent with
" T; J3 H1 V# k: T9 eits recent trend of 24,000 jobs a month. Assuming that the labour force grew at7 B& G; a: g8 ^$ s# ]9 H* [' M
its trend rate, a gain of 24,000 jobs will lead to a national unemployment rate" K- z1 Y$ E$ O, S2 _
of 6.1%." Overall very good news. Now the key is to ensure that the region in: w4 x/ U0 X6 y3 e
which you are investing is continuing to generate jobs and increasing incomes.6 A2 o$ ^% S- s' C
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In other words, it is a great time to be taking advantage of this strong
3 B* L2 b' g C% J5 Peconomy, avoiding 'excuses' and to especially not listen to the uninformed9 [+ d2 Z. K4 I/ Q( G
'dream stealers.' As long as you stick with your game plan, you continue to do5 O. J9 l0 Z( a: j: O" R
your due diligence, and you remove emotions from the equation, you will see the
1 Z' \. G" I: a; q5 a' Vopportunities that are right in front of you, right here in Alberta. Let the
E7 \; Q% r: f; d. U) G A'dream stealers' call you 'lucky' 5 years from now as your net worth has soared R, a' v' \1 h- b
and your financial freedom has surpassed even your wildest expectations.
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( O- j& F! N4 Z- H9 y6 J$ SCapital Gains Comparison.
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KPMG has recently released a comparison of the true Top Federal and Provincial6 |( u+ ^* M* B6 @- f, a+ d8 s
Marginal Capital Gains Tax Rates per province. It is very interesting to see
% g9 Q% m+ n8 o9 j* w+ U) }how these will affect your exit strategy. Here are the numbers:
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BC . . . . . . . . 21.9%
0 O5 Q+ u! O8 m7 Y* }/ gAB . . . . . . . . 19.5%
( W" \& [5 [. j5 Y* _& ISK . . . . . . . . 22.0%
% }+ K6 G* T4 i7 I4 D4 ^6 N: FMB . . . . . . . . 23.2%
6 Q3 E* ~4 c! N8 g7 qON . . . . . . . . 23.2%
' L2 V! A# j5 d- x: L5 [QC . . . . . . . . 24.1%
9 F4 n% r, z$ L! {6 WNB . . . . . . . . 23.4%
4 P2 K& N* w- Z) ^+ `5 t! tNS . . . . . . . . 24.1%; G- p; o6 b T* P
PE . . . . . . . . 23.7%- d) Q* _: P/ C2 q7 Z0 }% f+ z. U
NF . . . . . . . . 24.3%* ?( _) W J* w* o6 x+ h2 J$ k% C/ n
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Lower capital gains tax increases investment and stimulates the long term
4 H! B2 Q+ L1 G E6 m5 reconomy of the province. It also allows real estate investors to keep more of& e8 [* q+ O) F* g3 @
their profits at exit time. Always a good number to pay attention to.
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Overall, by staying focused for the next short period of time, you have the
2 ^8 v7 G: I. M. j. E. A) O+ _+ _opportunity to create financial freedom of which others can only dream. Of
8 ~. v, e' o& Ccourse, the key word is focus. And with an August line-up of 'Members Only'- x' r7 y+ a; ?8 \2 Q
events like this, you can't help to become a real estate investment champion. Q% t5 O9 Y* @( ~1 ^
when you take action as a full REIN Member.+ @: D( E: x* Q+ L
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Focus on the fundamentals, keep emotions out of your decisions, and enjoy the9 p3 _- m8 \8 p" H' O
results in just a few short years. |
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发表于 2006-8-25 08:35
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