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NEW HOUSING PRICE INDEX...
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) |; A- R3 \2 H4 L# W* TThe New Housing Price Index, has just been released and it provides some very3 w' E0 g: h- T" ]0 I6 W
interesting insights, not only into where the market has moved, but where it
9 y7 I# V% Z8 n# P! L8 qwill be going.) |' @* x l6 b8 R
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It proved, once again, the value of looking at fundamentals behind a market.5 L( k3 Z* ~" d
, y: V9 D% M, S+ \& VThe New Housing Price Index is compiled by Statistics Canada and is used by
6 V5 v$ M4 {. m3 J5 xsophisticated investors to see how much the market has moved, as well as an) e l: y8 i- F! |2 a8 E2 i1 s7 t
indicator of where re-sale home prices will be moving in the coming six months.
9 [) A& Z6 o7 [3 ?& V9 jWe look at the ripple effect that new housing prices have on re-sale property
# K( G0 Q! s! k* }8 J/ c: wvalues and can extrapolate what direction re-sale prices will be moving and by5 b. n ]& ~2 z% w* x
how much.
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For instance, for the last three years, we have told investors to avoid Windsor,
+ `6 g& s, I! R* B( ~- E8 ZOntario as an investment area because the underlying fundamentals are not very# l$ m, h: ^" i2 A/ z
strong. This has been proven once again with the release of the latest
, o' l0 \6 S" A. Z( @findings. New Housing Prices have actually decreased by .5% during June 2005 -
+ M# S( Q0 L) RJune 2006 proving that fundamental investing works in helping you pick the best' D& R0 b+ e! C1 l- o3 \
markets and avoid the flat ones. This .5% decrease should have little impact; a2 j2 a8 b* G- Q( J3 l. h- H6 q
on average re-sale values in the Windsor region.5 n' }9 ~6 \8 |. i2 K0 Y" C6 g
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To contrast this, the fundamentals we discuss are so strong in Calgary that the
6 {2 t1 m, }9 l/ _market continues to be super heated. With close to 3,000 net new people into
- `$ ]$ `7 p5 R; \the city every month, the property market just can't keep up. That is why we0 W, ?$ S# | @4 u( D6 k1 n! d
saw the New Housing Price Index increase by 49.2% (June 2005 to June 2006). & o3 E3 _9 x/ b0 X+ S; y+ E$ l) A2 |8 ?
This is great news for the future of re-sale values in the city as these
# q; X" k, @# S. oincreases will continue to ripple out into the market for at least the next six/ o. m# o! _9 ]. ]
months.
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Comparing these two regions is a great illustration of the value of not getting
6 j8 c) g4 ^/ bcaught in the 'emotional guessing game' by just focusing on the underlying4 u1 t3 @' U T! [8 h/ ]& g
fundamentals. It is sad to see those people who said in the last 2 years that
. V4 p! k4 O+ k3 xthe Alberta real estate market was over and they were going to sit back and wait5 X. N$ ?: S0 K" ~1 h/ v5 s
until it drops. Quite obviously, they have missed out on AMAZING gains, all- t: S' q0 F; o+ H4 u. S3 H. O
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
, F: n1 Q# j+ k9 C' S2005 to June 2006), also great news.
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By comparison across the country, these are the numbers for June 2005 - June8 `7 z' a( c! [# |, \7 o
2006 New Housing Price Index for:
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: T- i( V# u$ H e9 ]1 HVancouver . . . . . . . . +5.2%& Y0 v# t# G" k. ~* C0 s
Saskatoon . . . . . . . . +8.5%
! {5 x+ G& Q0 rLondon . . . . . . . . . . . +3.0%
# z1 `0 h9 L0 z' D3 p) B6 o: xHamilton . . . . . . . . . . +4.9%
; k3 x1 p; Q `$ gSt. Catharines - Niagara . . . . +4.9%
) w! @1 [9 l1 L* L2 YToronto and Oshawa . . . . . . . +3.2+ ]8 d/ v6 ]4 ?- I/ @# _
Ottawa - Gatineau . . . . . . . . . +3.1%5 R8 j/ F+ \3 J4 s! U, g
/ @& d# O$ C2 H& h% M6 r2 |Fundamental investing ALWAYS makes you look like a genius - emotional investing
# |! U3 ` q9 T; S# k: @gives you quick highs, but also quick lows. Well done on your focus!
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( ~. Q+ ` j1 c' a. S: jAs the fundamentals have been showing all along, the Alberta market continues to% ?- R( G- p" c, i3 P2 d7 I
be strong, as in-migration and job creation continues to attract people from not
: c- I. T( z, A4 konly across Canada, but from around the world. Our average wages are
" s( Y2 u/ T) }$ F/ W, A( @increasing, our population is increasing, our unemployment rate continues to5 A6 E) W4 y. e- }$ R: C- {
drop and our GDP growth is slated to once again lead the country.% [% P) ^1 o8 B' K# t
1 V* D: o+ r: }! B# JHere are some very interesting facts that are helping to support the strong$ d- z; z2 r4 M) y8 C- j7 q* }! q
fundamentals:
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5 y( P- ~" @$ ~. U6 E/ V1 I; w- x1. The Conference Board of Canada is forecasting strong economic growth in
" m" ?7 o% w# Z) OCanada, with Alberta once again leading the way. In fact, the projected growth% ~% _, A- |# d2 b% i3 [
for Alberta's economy is a staggering 6.6%. (BC + 3.6%, Ontario + 2.5%), and
; G3 Y' c% B1 F" A' F" Zthis is slated to occur even with the labour shortages we are witnessing.) U5 O+ D' n3 s# O7 g" U
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2. People are discovering Canada as an investment center from all over the# R' y9 y& P1 u" ~- C, L6 F3 r& K
world. Recently, there have been investors coming here from Asia, Australia,
' s$ j3 V$ `9 z1 Ethe US, UK and Europe. In fact, if you review the world's press you will see
& i+ i& e4 A/ p5 L1 q( Q- V; Tthat Canada (with a focus on Alberta) is being discussed more frequently. 4 A2 Y9 }, ^9 `1 m& {8 Y% `
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3. Don Campbell has just returned from presenting our Canadian investment) E* J5 p; u4 c x$ d) ]7 w9 ]: x% \, O
atmosphere (including Why Alberta - Why Now") to a group of major investors in
# j; b8 |2 q9 W' B! z8 S# s' sDublin, Ireland, and the response was overwhelmingly positive. In fact, after7 g0 o6 C, B4 ]
Don presented the economic facts, many of these investors (who could invest" Z w. A- O) [% z2 Q
anywhere in the world) have already booked their flights to here. Once again
q0 d5 ]6 m; |/ gproving that when the true numbers of our economy are presented (along with the ~+ ]3 ]1 E8 {) D& i$ }1 b% }, c0 X
political stability of our country), there is no place in the world that can
8 `- t) X) x/ S9 z/ w- X+ c nbeat it for long term investment.
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4 W3 Y2 I& j* r1 S4 `3 E% \4. Job creation continues to be strong (with a small lull in June); definitely
- x$ R0 ?- ?: R) ^* Z) T: i5 Ba sign of strong long-term fundamentals. RBC has also been following the job! n8 N1 h% h9 A% m
creation situation and here is what they are saying: (www.rbc.com/economics)- L2 @7 z* {# R: g# n
"After generating a substantial 96,700 jobs in May, the largest such gain since g) M3 ?* B4 m0 a3 A) s. a0 X3 h
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# g% ^, e4 b* y7 P
first half of 2006, a feat not matched since the second half of 2002. With the
- w5 \( G# I0 p+ g5 V5 Meconomy widely expected to grow at a more moderate pace in the second half of+ n; W' p: y0 E- \& J, J! w: i
the year on the back of slowing trade activity, this impressive showing may not4 Q5 @8 _' D+ Z n6 z
repeat itself. We expect that employment grew in July at a pace consistent with' m6 c/ b4 Y' i
its recent trend of 24,000 jobs a month. Assuming that the labour force grew at9 ] k Z0 _( X' a. O1 H1 I! O
its trend rate, a gain of 24,000 jobs will lead to a national unemployment rate1 }7 |7 {% \, F" A1 f
of 6.1%." Overall very good news. Now the key is to ensure that the region in
# J" [( t( y) A. ywhich you are investing is continuing to generate jobs and increasing incomes.( i) C) }9 p7 h2 g! d) c
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In other words, it is a great time to be taking advantage of this strong: o; ~1 N/ }6 N& @9 _
economy, avoiding 'excuses' and to especially not listen to the uninformed1 f- c5 t' r- ~: m+ j
'dream stealers.' As long as you stick with your game plan, you continue to do3 i8 b0 Y7 i; H% h$ `2 [1 I% V
your due diligence, and you remove emotions from the equation, you will see the% E' x- q4 h0 b7 b4 \3 T: F
opportunities that are right in front of you, right here in Alberta. Let the0 w( A4 G3 o% T* V, \/ W; `* o
'dream stealers' call you 'lucky' 5 years from now as your net worth has soared
" ?# e( ?$ R$ @/ Band your financial freedom has surpassed even your wildest expectations.1 O2 e- m/ M$ M: m5 z) m
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. @. S" v* E2 Y. v: nCapital Gains Comparison.
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7 S- o- ?2 ^. q$ o+ r' aKPMG has recently released a comparison of the true Top Federal and Provincial
* B* o- |6 M- g* J# [0 G- EMarginal Capital Gains Tax Rates per province. It is very interesting to see
$ S* G i8 Q# r1 V" X, g$ ihow these will affect your exit strategy. Here are the numbers:
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) _; k& _5 ^5 h3 eBC . . . . . . . . 21.9%( d! |: |+ C H6 D( k4 u
AB . . . . . . . . 19.5%
7 V. `6 C0 x+ ]+ |SK . . . . . . . . 22.0%
& U/ a7 m! U' R. A7 E3 [0 CMB . . . . . . . . 23.2%
' O7 j2 z: L! HON . . . . . . . . 23.2%
2 h* {; y2 ]4 oQC . . . . . . . . 24.1%
4 T6 [9 p( L. x! V& |8 X# zNB . . . . . . . . 23.4%
0 m8 u' n3 i% Z# L7 @( XNS . . . . . . . . 24.1%
' H! `7 P& s* a" Z4 cPE . . . . . . . . 23.7%$ o( V, C' T; P$ L* B$ ^" x% Q
NF . . . . . . . . 24.3%5 C- Z5 Z. n0 x0 `+ x6 L. J E
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Lower capital gains tax increases investment and stimulates the long term# I7 D. M3 U) `9 v. ]# I- g
economy of the province. It also allows real estate investors to keep more of
4 r0 j6 }; i3 m; u# r* Ftheir profits at exit time. Always a good number to pay attention to.
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- H+ R, \0 K d' { O9 `0 ROverall, by staying focused for the next short period of time, you have the2 j5 q* e! u; N8 @0 n2 |4 l1 p
opportunity to create financial freedom of which others can only dream. Of4 T$ D; D9 P2 t4 ^2 T$ ?6 L
course, the key word is focus. And with an August line-up of 'Members Only'( K* _. x h" w) l& r
events like this, you can't help to become a real estate investment champion
6 E+ Z% {8 ]5 gwhen you take action as a full REIN Member.- N/ t& `5 X u5 ]$ T: W* ]
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Focus on the fundamentals, keep emotions out of your decisions, and enjoy the6 R& ~! E0 B# ~9 I$ [& V: V
results in just a few short years. |
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发表于 2006-8-25 08:35
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