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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
6 X2 t4 F: e; binteresting insights, not only into where the market has moved, but where it5 P1 V1 x" C2 U. K& \! ~# \- _
will be going.9 H+ [9 i1 S: X; ~
+ G8 J) _" G, G- L# KIt proved, once again, the value of looking at fundamentals behind a market.
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2 y" O/ K' j7 Z% _ ^% j1 yThe New Housing Price Index is compiled by Statistics Canada and is used by, T/ q3 s2 I( u3 }' X# A; Z9 U' Z
sophisticated investors to see how much the market has moved, as well as an
' }: ~- \9 J- E0 d4 [, G: c- K) I4 B$ yindicator of where re-sale home prices will be moving in the coming six months.
1 f1 C5 q2 ?! E; q$ VWe look at the ripple effect that new housing prices have on re-sale property
7 O* a1 C1 Y L; a: r5 ?& g) Vvalues and can extrapolate what direction re-sale prices will be moving and by+ q L3 y1 I( R! K/ m0 ]
how much.
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, o( B! g: r1 b4 e$ _For instance, for the last three years, we have told investors to avoid Windsor,
: J' V. O- _1 o! y) |Ontario as an investment area because the underlying fundamentals are not very
: g2 n8 }3 N6 N1 l1 x& K# w0 ~strong. This has been proven once again with the release of the latest
9 ]8 l; E& h; Q p; r" \% e+ a+ Jfindings. New Housing Prices have actually decreased by .5% during June 2005 -: q: s! L# N; \) Z
June 2006 proving that fundamental investing works in helping you pick the best: f2 Z0 r# k5 X- O( d! q& c) Y
markets and avoid the flat ones. This .5% decrease should have little impact e, y0 R& M7 @+ ~% v6 v0 ]6 \
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& f% t$ e/ p& m& s r
market continues to be super heated. With close to 3,000 net new people into
1 K+ ?9 A' S; `! g0 m/ H4 Tthe city every month, the property market just can't keep up. That is why we; P1 v* w8 F. k/ |) s
saw the New Housing Price Index increase by 49.2% (June 2005 to June 2006).
/ V# ]; A6 d, VThis is great news for the future of re-sale values in the city as these
5 r% p N) E& l3 Lincreases will continue to ripple out into the market for at least the next six* ]0 A& d. v% g5 Z; W+ `
months.
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Comparing these two regions is a great illustration of the value of not getting
- H9 u( h" O0 X6 A. Ocaught in the 'emotional guessing game' by just focusing on the underlying
* G8 @3 N7 _7 K& {3 |" E2 Qfundamentals. It is sad to see those people who said in the last 2 years that
; I, n B: S7 `the Alberta real estate market was over and they were going to sit back and wait5 p. g- I% }3 `* v
until it drops. Quite obviously, they have missed out on AMAZING gains, all/ U- n, r( E% b
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
$ V4 d( T* L/ ^" h1 a0 ]( q1 c* z2005 to June 2006), also great news.
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By comparison across the country, these are the numbers for June 2005 - June$ Y& @6 E6 Q* {" y- u
2006 New Housing Price Index for:( a! e% d- A% D; N5 y9 A; n
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Vancouver . . . . . . . . +5.2%8 ^8 ]4 }( ^$ E8 p; a$ ]9 y
Saskatoon . . . . . . . . +8.5%9 u2 {- }! K: B3 c6 I0 ?
London . . . . . . . . . . . +3.0%
3 Y! T- D: Z2 K' VHamilton . . . . . . . . . . +4.9%
! J2 Z0 e" p% K, ISt. Catharines - Niagara . . . . +4.9%
4 F$ c# r8 L J1 S; P: |9 nToronto and Oshawa . . . . . . . +3.2
% G, k9 N1 C4 }" E, L, d" qOttawa - Gatineau . . . . . . . . . +3.1%$ N3 l, z3 p& l0 O
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Fundamental investing ALWAYS makes you look like a genius - emotional investing+ p7 s8 E) B- R/ D
gives you quick highs, but also quick lows. Well done on your focus!2 w1 D3 @& S8 h7 l& J% D
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As the fundamentals have been showing all along, the Alberta market continues to
$ v b6 X1 W; L r7 t6 U- c5 pbe strong, as in-migration and job creation continues to attract people from not
1 k1 S$ Z+ _8 Z3 x/ q% ^9 Fonly across Canada, but from around the world. Our average wages are+ n6 m% u5 T5 B& }* D
increasing, our population is increasing, our unemployment rate continues to* R5 f9 P, P( G' m
drop and our GDP growth is slated to once again lead the country.
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$ ~+ z1 ?& i! H/ j0 ~) M7 PHere are some very interesting facts that are helping to support the strong# p7 _) B' J8 @/ I% Q2 q O. B) x
fundamentals:
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1. The Conference Board of Canada is forecasting strong economic growth in
% `& ]' j& A- F& o% e$ ~- @9 WCanada, with Alberta once again leading the way. In fact, the projected growth: d4 Q) p7 B4 u! q3 j- Y8 y( q3 k! q
for Alberta's economy is a staggering 6.6%. (BC + 3.6%, Ontario + 2.5%), and* @$ {: `8 u0 |' I
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
( F4 i2 _4 [' `2 H3 ]: r0 P& Q4 q) aworld. Recently, there have been investors coming here from Asia, Australia,
1 e% Z8 b- v6 ]the US, UK and Europe. In fact, if you review the world's press you will see( E$ a( h1 C x6 o* c: Q
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( d1 Y, @; t) v W( Q
atmosphere (including Why Alberta - Why Now") to a group of major investors in
& x- L! [, @, S, E( z1 TDublin, Ireland, and the response was overwhelmingly positive. In fact, after+ e- y1 q: N" U' G E) l. ]
Don presented the economic facts, many of these investors (who could invest/ V( ^0 _! z% k
anywhere in the world) have already booked their flights to here. Once again
0 x+ Q" |4 P8 y( L8 L7 Z5 Nproving that when the true numbers of our economy are presented (along with the
+ g0 |; @( G1 [: Lpolitical stability of our country), there is no place in the world that can- T' U, c/ {, [" t# Y u
beat it for long term investment.' S8 d. J; u! Y* q
6 }) |. z0 {6 {& H8 D8 a6 l/ G# s4. Job creation continues to be strong (with a small lull in June); definitely
* T: ^: ~: }8 T' l2 M# va sign of strong long-term fundamentals. RBC has also been following the job
/ v& l! F$ H7 c' j- F5 ~' icreation situation and here is what they are saying: (www.rbc.com/economics)
0 q! m5 e6 \" m% ?9 |"After generating a substantial 96,700 jobs in May, the largest such gain since5 Z7 b1 g4 }' Y& L$ f. E' H/ N
January 2002, the economy lost a modest 4,600 jobs in June... 5 C+ @3 k3 A/ D/ d6 l( b! F
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Strength in the Canadian economy contributed to a gain of 215,600 jobs in the% u. ^6 c3 n( C
first half of 2006, a feat not matched since the second half of 2002. With the
* q9 t0 e% I$ L* peconomy widely expected to grow at a more moderate pace in the second half of
; V# ]% r/ E0 U8 X+ Tthe year on the back of slowing trade activity, this impressive showing may not
" \9 ~' T# \+ W( | q4 Orepeat itself. We expect that employment grew in July at a pace consistent with4 Y' r5 x6 n; x% r& G: x9 d
its recent trend of 24,000 jobs a month. Assuming that the labour force grew at. {' Z; V, r z: Y5 B6 i& I2 E
its trend rate, a gain of 24,000 jobs will lead to a national unemployment rate
* I, M- Q& R, C9 ] q- N$ F* Gof 6.1%." Overall very good news. Now the key is to ensure that the region in
+ i) Y A- W Xwhich 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* c# B- f+ v' V' }' |% n3 K3 y
economy, avoiding 'excuses' and to especially not listen to the uninformed
0 G3 V3 v3 O- t5 `'dream stealers.' As long as you stick with your game plan, you continue to do
# ]4 P" }$ m. r1 I3 f+ P! L6 oyour due diligence, and you remove emotions from the equation, you will see the
* P' z# F2 ^! b' C0 g4 x/ ?0 s0 h) f* Fopportunities that are right in front of you, right here in Alberta. Let the
~8 q( L1 h5 Q1 r y! E i'dream stealers' call you 'lucky' 5 years from now as your net worth has soared
5 N, V# C7 }% eand your financial freedom has surpassed even your wildest expectations.' s4 j( h% k6 c ~/ }; n w* B# W
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' `! C+ b# Y% C. l% r3 TCapital Gains Comparison.7 l; V0 _5 v* ]! Z9 ~/ y& m
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KPMG has recently released a comparison of the true Top Federal and Provincial$ L0 e% K- I6 j
Marginal Capital Gains Tax Rates per province. It is very interesting to see
) w6 g6 U) w7 R$ `% n/ T. e1 @how these will affect your exit strategy. Here are the numbers:/ x. a( M1 L+ ~1 e" V" i
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BC . . . . . . . . 21.9%9 T9 ^9 G6 Q3 w4 h. D
AB . . . . . . . . 19.5%
) M8 [$ s- N' o. M0 @SK . . . . . . . . 22.0%
, C) u- w1 f$ J6 U" H3 d6 CMB . . . . . . . . 23.2%' z/ A( _ U. ~, l8 ^% N' {2 U3 o
ON . . . . . . . . 23.2%2 L5 h" ]( {* l3 y
QC . . . . . . . . 24.1%1 j9 y6 o# o7 e# |. v
NB . . . . . . . . 23.4%0 f j- {+ Z0 P) [! Y, s! z
NS . . . . . . . . 24.1%
! M7 j! E7 y) e0 ~# m; T6 h! `PE . . . . . . . . 23.7%
+ z \2 r. b7 g/ i6 I$ m0 q* UNF . . . . . . . . 24.3%
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Lower capital gains tax increases investment and stimulates the long term! B1 l/ `3 w$ z3 N' p
economy of the province. It also allows real estate investors to keep more of" e2 F; {( F' o1 L' G4 g, }* b" ?
their profits at exit time. Always a good number to pay attention to.
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) V" ^; l, W7 I! FOverall, by staying focused for the next short period of time, you have the" p f- l* z1 ]. [6 Y
opportunity to create financial freedom of which others can only dream. Of; X5 a1 U. A; V6 h* M9 I+ {3 V
course, the key word is focus. And with an August line-up of 'Members Only'
% s& D5 W+ R. C3 d) @events like this, you can't help to become a real estate investment champion3 ?1 H2 W$ n% q1 H
when you take action as a full REIN Member.* K* N; ?- ? B& Q
& h) g x1 {) {' {4 A6 N1 @Focus on the fundamentals, keep emotions out of your decisions, and enjoy the
* t; B. m" n6 N: J. eresults in just a few short years. |
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发表于 2006-8-25 08:35
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