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NEW HOUSING PRICE INDEX...
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The New Housing Price Index, has just been released and it provides some very) v f$ l3 }7 t: y/ a! E7 o
interesting insights, not only into where the market has moved, but where it
3 V* G) `/ Z& s% F) x$ @will be going.
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- l% l8 K9 o: T& F5 }It proved, once again, the value of looking at fundamentals behind a market.! @% r% E/ T8 q. i( _# l
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The New Housing Price Index is compiled by Statistics Canada and is used by
6 {, X$ O7 I/ W4 I9 _/ B* Bsophisticated investors to see how much the market has moved, as well as an# u2 ]. i, V/ r$ r& |% b
indicator of where re-sale home prices will be moving in the coming six months.
8 Y. v! ~! o9 l2 {; ]% l$ j) bWe look at the ripple effect that new housing prices have on re-sale property
9 w- m' V+ G- z) yvalues and can extrapolate what direction re-sale prices will be moving and by
! `: D- l' \; J8 Q; V8 mhow much.' u2 F" x+ Q2 r7 g
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For instance, for the last three years, we have told investors to avoid Windsor,
" J% k7 b* R1 X: e) j/ iOntario as an investment area because the underlying fundamentals are not very7 \ b4 G% M! m9 A1 G* \* p0 |
strong. This has been proven once again with the release of the latest* t. i( S+ R7 b/ C) v5 P# d5 w
findings. New Housing Prices have actually decreased by .5% during June 2005 -, |/ E9 m" d7 f7 F$ ^+ J
June 2006 proving that fundamental investing works in helping you pick the best
4 ]% L' S# v( q/ D: q" F- ^7 l0 F; @markets and avoid the flat ones. This .5% decrease should have little impact
; k" ^% m) m' Bon average re-sale values in the Windsor region.
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6 c0 ]3 L( I1 B4 {1 MTo contrast this, the fundamentals we discuss are so strong in Calgary that the+ R) V- b5 a: k0 t/ J& `; i
market continues to be super heated. With close to 3,000 net new people into
6 S3 M- z; j1 i8 _the city every month, the property market just can't keep up. That is why we
( o. |+ j/ e# O% vsaw the New Housing Price Index increase by 49.2% (June 2005 to June 2006). 0 \! `1 T9 |: A* U! n, `0 D
This is great news for the future of re-sale values in the city as these
; I. ^, s; @; D0 |0 Y/ Fincreases will continue to ripple out into the market for at least the next six7 W) M9 ]( }/ d, y% i
months.
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Comparing these two regions is a great illustration of the value of not getting2 C1 s$ C- E' T6 m) J* ]
caught in the 'emotional guessing game' by just focusing on the underlying: u! C9 y# }( ], [" ^) G+ B
fundamentals. It is sad to see those people who said in the last 2 years that# S3 G. v/ r0 {0 c' _
the Alberta real estate market was over and they were going to sit back and wait1 l0 |6 N+ y2 d! a4 F# ?2 }
until it drops. Quite obviously, they have missed out on AMAZING gains, all
7 o* L- p9 s' P" b3 lbecause 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
6 U6 g3 v1 U' E) ^8 A2005 to June 2006), also great news.
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By comparison across the country, these are the numbers for June 2005 - June& K6 X/ Z2 T3 b5 S5 S* `6 u# ~) h
2006 New Housing Price Index for:( n* M% i' E7 a
. z1 k3 T% x# S- B; tVancouver . . . . . . . . +5.2%; V' j" I/ s7 I! n* y- ]8 `
Saskatoon . . . . . . . . +8.5%
" R; ]& ~- y5 N JLondon . . . . . . . . . . . +3.0%1 |% V3 T3 F: ~% D2 a$ ~. B
Hamilton . . . . . . . . . . +4.9%
7 l$ D$ S" ?, \# Q) F6 OSt. Catharines - Niagara . . . . +4.9%
( c7 Y; ]$ Q, L. B4 d: S2 FToronto and Oshawa . . . . . . . +3.2
" j. j5 u6 J( c# ]Ottawa - Gatineau . . . . . . . . . +3.1%' j# n# q3 W% A' C
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Fundamental investing ALWAYS makes you look like a genius - emotional investing
$ P/ k# S& O9 igives you quick highs, but also quick lows. Well done on your focus!$ C1 c& I3 @$ s' t# \
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As the fundamentals have been showing all along, the Alberta market continues to
" e0 w6 H' k9 a) q0 x# j0 Y' s, Pbe strong, as in-migration and job creation continues to attract people from not3 j" k5 ?: T1 d. z
only across Canada, but from around the world. Our average wages are
" Z' W$ x3 z V9 C! b! U& xincreasing, our population is increasing, our unemployment rate continues to
! _. w+ a) {: i$ y5 g/ Zdrop and our GDP growth is slated to once again lead the country.- k6 _$ e. ~; W
& W: D) l8 w0 j0 J; N8 _- q5 v& l/ ~Here are some very interesting facts that are helping to support the strong) ?: `. D; z6 j$ T( m
fundamentals:
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6 R! M8 M) `$ i6 S; H& z. \: j3 l1. The Conference Board of Canada is forecasting strong economic growth in* s0 B* H' i/ }( t$ J/ g
Canada, with Alberta once again leading the way. In fact, the projected growth9 u: k1 N& S# u+ D- E0 X1 B9 ~# _
for Alberta's economy is a staggering 6.6%. (BC + 3.6%, Ontario + 2.5%), and
8 Y8 b& |! h1 B8 d' {; [this is slated to occur even with the labour shortages we are witnessing.. ?4 p! N" j1 v z1 I
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2. People are discovering Canada as an investment center from all over the. K7 T3 T1 E: X" v* T! ]" M4 a+ d
world. Recently, there have been investors coming here from Asia, Australia,
! o+ c; {) u7 i; b/ ^4 s( Z# B3 Dthe US, UK and Europe. In fact, if you review the world's press you will see9 i/ Z7 ?6 ?7 T9 x! B1 ^' y
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 investment0 f% Q9 ~9 G ~3 G; w- N! x
atmosphere (including Why Alberta - Why Now") to a group of major investors in, @8 L) J% F9 X/ p/ C1 a5 ^
Dublin, Ireland, and the response was overwhelmingly positive. In fact, after
5 ]; K/ L. H6 U4 u4 k# bDon presented the economic facts, many of these investors (who could invest
) I8 I9 H& h) j+ W- manywhere in the world) have already booked their flights to here. Once again
6 R' s4 \( Q0 } ?! ~proving that when the true numbers of our economy are presented (along with the
% c# e. ^2 C& zpolitical stability of our country), there is no place in the world that can
, h1 z5 U( b" b5 k! Y) jbeat it for long term investment.# i! X7 I7 r8 x2 P" J
9 a( L4 t2 G9 T9 D& j6 f4. Job creation continues to be strong (with a small lull in June); definitely; Y* s* A6 G, ~' B! \
a sign of strong long-term fundamentals. RBC has also been following the job7 l8 t% J2 z( Y# a* X+ a7 E6 I
creation situation and here is what they are saying: (www.rbc.com/economics)
4 H$ c( L, a7 L2 h5 m0 Q9 |$ `$ B4 u"After generating a substantial 96,700 jobs in May, the largest such gain since
+ I( A( P; o# tJanuary 2002, the economy lost a modest 4,600 jobs in June... 7 e4 K$ ? j$ w- y* s
$ V- ], T3 ~, i/ b/ O2 ~Strength in the Canadian economy contributed to a gain of 215,600 jobs in the
4 x( P4 A) u- K4 j* @first half of 2006, a feat not matched since the second half of 2002. With the! c/ F$ N* N8 i+ b! T0 k
economy widely expected to grow at a more moderate pace in the second half of- @8 s1 F/ X2 f; s; D. N
the year on the back of slowing trade activity, this impressive showing may not
& A3 d. r3 b$ N# ?& \repeat itself. We expect that employment grew in July at a pace consistent with' A& ~; ?, J" L4 _+ d9 D7 z
its recent trend of 24,000 jobs a month. Assuming that the labour force grew at( {9 @% g$ s( ?) V; g
its trend rate, a gain of 24,000 jobs will lead to a national unemployment rate
* t) _' c6 H9 y2 }0 _ c9 J+ Vof 6.1%." Overall very good news. Now the key is to ensure that the region in8 {, [) f6 _4 h% ~) G
which you are investing is continuing to generate jobs and increasing incomes., O. T/ I, G6 ]7 R9 X( J) ~
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" O+ N1 t& {$ q! e( fIn other words, it is a great time to be taking advantage of this strong( j: P! [& B. D: Q4 P) l4 M
economy, avoiding 'excuses' and to especially not listen to the uninformed
, K6 H) d' J0 j8 x8 _'dream stealers.' As long as you stick with your game plan, you continue to do/ d% y1 g' k* d3 u. T- c
your due diligence, and you remove emotions from the equation, you will see the
+ X: U4 p/ C jopportunities that are right in front of you, right here in Alberta. Let the2 F" a) H2 g- J7 i' K2 e
'dream stealers' call you 'lucky' 5 years from now as your net worth has soared
6 w9 P1 q+ e# g( K+ {and your financial freedom has surpassed even your wildest expectations.7 n. x2 \/ ]& V. ]! v
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Capital Gains Comparison.7 D% R. D, i/ e( q
2 `# S9 b9 d: S! `" O9 TKPMG has recently released a comparison of the true Top Federal and Provincial
G7 F8 I6 m2 C+ F+ v2 G' sMarginal Capital Gains Tax Rates per province. It is very interesting to see6 ?/ k* Y4 ^$ n$ \
how these will affect your exit strategy. Here are the numbers:
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6 E4 u$ w5 ?7 l1 H+ f. l% VBC . . . . . . . . 21.9%
( L3 A. f$ v0 A8 K2 w/ wAB . . . . . . . . 19.5%
5 ^/ d; S9 ?* uSK . . . . . . . . 22.0%: i" F% c0 V8 @/ g2 t
MB . . . . . . . . 23.2%
( L$ R/ A( { {" W8 lON . . . . . . . . 23.2%
8 C: B b: s; B9 U$ s/ j; BQC . . . . . . . . 24.1%
) T* U" G# o" h' I& E/ lNB . . . . . . . . 23.4%
3 {9 O2 y6 U" c+ NNS . . . . . . . . 24.1%" g8 _2 y7 f0 a" Y e! ~. f1 p8 h
PE . . . . . . . . 23.7%
' P( n% G1 s3 QNF . . . . . . . . 24.3%6 W3 h6 P2 u" e8 }
, Z8 b; n: @! \ a& _! t: SLower capital gains tax increases investment and stimulates the long term$ E8 V, G: ]( L$ `! Y
economy of the province. It also allows real estate investors to keep more of
1 q2 |: a5 ^! o( B3 Ltheir profits at exit time. Always a good number to pay attention to.* s% i0 L! p, m2 ^
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3 C4 w( k/ z$ c. NOverall, by staying focused for the next short period of time, you have the
) Y! R P: q% W+ M* H9 F; A; Xopportunity to create financial freedom of which others can only dream. Of
4 V; l0 X. G% u$ d5 U' Rcourse, the key word is focus. And with an August line-up of 'Members Only'
1 u/ l2 S) {$ Z& j7 _+ `events like this, you can't help to become a real estate investment champion
! q$ _+ f' @6 D$ H% N3 Y$ A- j8 _. dwhen you take action as a full REIN Member.7 K! y- g6 T7 \
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Focus on the fundamentals, keep emotions out of your decisions, and enjoy the
/ K$ {5 }) T9 jresults in just a few short years. |
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发表于 2006-8-25 08:35
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