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NEW HOUSING PRICE INDEX...( c+ ~9 W4 f0 X1 O
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+ Q* p: M# A k, G" h9 @' A- FThe New Housing Price Index, has just been released and it provides some very
9 K7 G& d, U" p7 e' i9 tinteresting insights, not only into where the market has moved, but where it
! V1 Q0 Z( v4 Nwill be going.9 A x" G7 n5 z& p* ]0 ?
% y7 q6 m3 w+ @8 C9 sIt 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
- R. }: t, A2 Q% f" Ysophisticated investors to see how much the market has moved, as well as an
0 m; q# B/ h- J! `0 q: eindicator of where re-sale home prices will be moving in the coming six months.
3 W* e y: b# |8 fWe look at the ripple effect that new housing prices have on re-sale property* P8 l9 a0 B) \' {* w
values and can extrapolate what direction re-sale prices will be moving and by
" R& G0 d# M: ?3 D% e7 ^how much.
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& p1 N. D2 g% e0 `+ }; |For instance, for the last three years, we have told investors to avoid Windsor,- H* {5 l# B4 L( q7 Y/ b
Ontario as an investment area because the underlying fundamentals are not very
" G% T H i0 tstrong. This has been proven once again with the release of the latest; z5 }. h3 N7 |) D
findings. New Housing Prices have actually decreased by .5% during June 2005 -% z# t* z8 t, b; @
June 2006 proving that fundamental investing works in helping you pick the best. R; {' W M' N( n) S
markets and avoid the flat ones. This .5% decrease should have little impact& r; L5 E8 `) Q, w1 q3 l- T
on average re-sale values in the Windsor region.
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To contrast this, the fundamentals we discuss are so strong in Calgary that the
; ^3 V' Z7 ]) T3 t1 k+ Smarket continues to be super heated. With close to 3,000 net new people into
# m0 k& N6 l7 j; j1 P3 X& w( Tthe city every month, the property market just can't keep up. That is why we ]4 C* b% R5 a( i5 z' O
saw the New Housing Price Index increase by 49.2% (June 2005 to June 2006).
. C( F5 u6 o' T$ |This is great news for the future of re-sale values in the city as these
) P9 ^" z7 E! O Pincreases will continue to ripple out into the market for at least the next six, _: l. H4 [* o7 S0 d* S/ J2 L) i
months.
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& s6 W/ y( m9 YComparing these two regions is a great illustration of the value of not getting9 s y7 [$ M5 p' @
caught in the 'emotional guessing game' by just focusing on the underlying! Z3 e1 \5 j+ ^4 |( {
fundamentals. It is sad to see those people who said in the last 2 years that/ d% d9 b! Z1 z7 K8 C: f
the Alberta real estate market was over and they were going to sit back and wait
! v) U$ T. C* ?; G% @) D0 Iuntil it drops. Quite obviously, they have missed out on AMAZING gains, all4 \' a1 H, k* U; W
because they didn't follow fundamentals, they just led with their emotions.4 o0 M$ v) I2 H" i- H* K* u
5 s: |- t# ^6 @2 v3 Y; BBy the way, Edmonton's New Housing Price Index is up an amazing 28% so far (June' P, t1 E0 Z- @
2005 to June 2006), also great news.- j* H) l' |' f3 h1 a" ~
* ?1 X! w4 c! C* Y8 F* XBy comparison across the country, these are the numbers for June 2005 - June% K+ i; X+ W: Q k. t/ \
2006 New Housing Price Index for:
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Vancouver . . . . . . . . +5.2%
5 m1 Z" G' K+ W0 K- b* A' t8 dSaskatoon . . . . . . . . +8.5%4 w- H; [: [- U2 y+ E
London . . . . . . . . . . . +3.0%
$ s+ W& I9 a0 k0 x+ SHamilton . . . . . . . . . . +4.9% X& C) S2 i7 h" P. o5 l% [; o* w$ t
St. Catharines - Niagara . . . . +4.9%" I7 \ V, A0 l1 f
Toronto and Oshawa . . . . . . . +3.2
% x# P B7 Q% U0 HOttawa - Gatineau . . . . . . . . . +3.1%" o( i% y5 d4 w! k
% P& `4 e! r \Fundamental investing ALWAYS makes you look like a genius - emotional investing
, ?) V% l+ J- e& P9 I" J6 Q! R0 A. Sgives you quick highs, but also quick lows. Well done on your focus!- t4 `% z& j/ P
* z0 Z; m' b( d4 b9 s- t \As the fundamentals have been showing all along, the Alberta market continues to
' l6 d @: { b8 G' ebe strong, as in-migration and job creation continues to attract people from not+ s ` v1 `# A5 X0 c
only across Canada, but from around the world. Our average wages are
' G, R' S% | j: P- Kincreasing, our population is increasing, our unemployment rate continues to
4 Y) O' F' I, [8 qdrop and our GDP growth is slated to once again lead the country.
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; X A( ]: @$ L* ^Here are some very interesting facts that are helping to support the strong
3 X( ]/ @/ ]- D! }! {, O( z( B! Gfundamentals:
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4 s( I8 y+ N- d" D3 v q2 y1. The Conference Board of Canada is forecasting strong economic growth in6 m6 ^* c% n( Q% X: e+ T; Q
Canada, with Alberta once again leading the way. In fact, the projected growth
5 ^. l. E% i# m8 W, K: rfor Alberta's economy is a staggering 6.6%. (BC + 3.6%, Ontario + 2.5%), and
1 h Y" ~! t4 o1 K" nthis is slated to occur even with the labour shortages we are witnessing.$ z3 X' Z7 U7 [4 @9 `
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2. People are discovering Canada as an investment center from all over the% U0 b- ^; C) A, u) j& _, \
world. Recently, there have been investors coming here from Asia, Australia,' }8 j* ?, R$ r) [5 g
the US, UK and Europe. In fact, if you review the world's press you will see, f% J% z% |% @- n2 _$ t
that Canada (with a focus on Alberta) is being discussed more frequently. # d5 ~5 V$ ]" R6 ^, v; n
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3. Don Campbell has just returned from presenting our Canadian investment
$ T! D$ T$ n6 T E. n4 catmosphere (including Why Alberta - Why Now") to a group of major investors in6 p X& d1 P' B* D. k# F- [
Dublin, Ireland, and the response was overwhelmingly positive. In fact, after
/ {( g/ t i( R/ G! F' vDon presented the economic facts, many of these investors (who could invest9 M. M) ~. Z6 y/ m
anywhere in the world) have already booked their flights to here. Once again; E8 w2 z: L% l, |8 o6 k u8 U" d
proving that when the true numbers of our economy are presented (along with the
: Y: j. y! v1 y- P! |# X) v+ qpolitical stability of our country), there is no place in the world that can0 R5 ~% F: _, h: h; Q; O8 x. _
beat it for long term investment.( e# D5 x0 K7 T" @( A4 I" b
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4. Job creation continues to be strong (with a small lull in June); definitely
; O) f }0 p: k$ M4 Z* ]a sign of strong long-term fundamentals. RBC has also been following the job; E3 \0 M6 K+ l/ n W% X0 h7 q0 u1 @
creation situation and here is what they are saying: (www.rbc.com/economics)
$ o8 k2 E2 n, y( \$ e"After generating a substantial 96,700 jobs in May, the largest such gain since, h* B0 {: M0 v0 D5 V
January 2002, the economy lost a modest 4,600 jobs in June...
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/ N% _) [/ R; B& A+ _+ L! o/ qStrength in the Canadian economy contributed to a gain of 215,600 jobs in the) e! h D# ~, w/ O. z
first half of 2006, a feat not matched since the second half of 2002. With the
2 q1 I7 @& b3 U- f; Seconomy widely expected to grow at a more moderate pace in the second half of: M5 h7 O, P+ S; H0 W
the year on the back of slowing trade activity, this impressive showing may not
' [: H1 w6 H" o5 a1 qrepeat itself. We expect that employment grew in July at a pace consistent with
! P3 i4 B4 P7 N9 cits recent trend of 24,000 jobs a month. Assuming that the labour force grew at l- Z# C& ]. q9 E: h
its trend rate, a gain of 24,000 jobs will lead to a national unemployment rate3 U1 n* \" ]3 @) T8 K8 s% J
of 6.1%." Overall very good news. Now the key is to ensure that the region in) o" i3 A% @# p9 u2 A; c7 p
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 strong7 A! @$ x r. {/ o5 a0 c
economy, avoiding 'excuses' and to especially not listen to the uninformed
2 m$ t- J5 I- H4 \; ]'dream stealers.' As long as you stick with your game plan, you continue to do& T4 ~/ n- k! S$ ?
your due diligence, and you remove emotions from the equation, you will see the
: }1 {) s9 Z& H6 a2 P9 `" yopportunities that are right in front of you, right here in Alberta. Let the
. \7 Q0 u$ l6 e8 M6 A, O& O/ W. h9 j6 Z'dream stealers' call you 'lucky' 5 years from now as your net worth has soared
9 H( `, o9 T7 H% n1 d8 A" wand your financial freedom has surpassed even your wildest expectations.) n; j& p/ p n5 l) B
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1 f# T9 z% n6 i4 t, H \$ C- @& HCapital Gains Comparison.
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; G1 d4 |( ?! c7 JKPMG has recently released a comparison of the true Top Federal and Provincial
8 w" K" Q+ R3 J3 Y! gMarginal Capital Gains Tax Rates per province. It is very interesting to see+ K8 I D% @, i2 Z Q2 ]% c/ H
how these will affect your exit strategy. Here are the numbers:0 V# S9 U$ T. F+ H3 N( Z$ U
+ V9 c* B( e$ {5 Q
BC . . . . . . . . 21.9%
% J! T2 J3 D( iAB . . . . . . . . 19.5%( C, Z+ E6 g+ D; M
SK . . . . . . . . 22.0%- ]: m. B3 i. Q
MB . . . . . . . . 23.2%: o$ C7 p0 [2 `1 z/ s$ D( X7 c2 P
ON . . . . . . . . 23.2%
: H- I0 Z; V. C: RQC . . . . . . . . 24.1%. y: u# H. @( ~6 T g8 t: P
NB . . . . . . . . 23.4%
, E2 w; Y' d- iNS . . . . . . . . 24.1%
, }' x8 X$ A0 K$ gPE . . . . . . . . 23.7%
" F+ M6 S% l. \- @# n& CNF . . . . . . . . 24.3%0 r( _% l; m. Y# e
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Lower capital gains tax increases investment and stimulates the long term
! R* a3 m" L1 q/ k( _economy of the province. It also allows real estate investors to keep more of
9 o+ F9 x& o: i( |$ U S$ l+ |. R* C+ F' stheir profits at exit time. Always a good number to pay attention to.: i! m+ j+ I8 Y6 O
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Overall, by staying focused for the next short period of time, you have the% X+ k1 C/ ^' F
opportunity to create financial freedom of which others can only dream. Of
& G! g e' u9 e5 lcourse, the key word is focus. And with an August line-up of 'Members Only'
/ h4 w: m0 }0 q' Q. y# X, Y0 Xevents like this, you can't help to become a real estate investment champion) l/ ~7 h. j0 i b% j5 ?/ |
when you take action as a full REIN Member.' O* J, S+ e) p& ~" S- T1 k+ U5 W
" ~3 B- K2 ?; L0 \8 a" S; p" EFocus on the fundamentals, keep emotions out of your decisions, and enjoy the# R% D: p& r6 D% h# V; i/ r
results in just a few short years. |
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发表于 2006-8-25 08:35
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