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NEW HOUSING PRICE INDEX...
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; }7 i1 t: f( j+ o2 u/ d! yThe New Housing Price Index, has just been released and it provides some very
/ z' J$ K7 C7 d' X0 C9 |- Ginteresting insights, not only into where the market has moved, but where it
, t+ e v/ n7 C) K" ~will be going.
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# t% k5 O0 p4 i; e+ V- YIt 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
, P5 T- U' b! ^! Z5 ^+ M3 ?sophisticated investors to see how much the market has moved, as well as an$ ~6 B# g3 B; ^+ k [2 ^/ ?4 T
indicator of where re-sale home prices will be moving in the coming six months.
% `7 o" w; W4 q; q) l" ?+ E" sWe look at the ripple effect that new housing prices have on re-sale property" P2 Y* z/ @" O2 W
values and can extrapolate what direction re-sale prices will be moving and by! Y- m. ?3 @& {* M# h% z9 m
how much.4 p9 b r7 X+ [% K0 E# ^
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For instance, for the last three years, we have told investors to avoid Windsor,! m* y0 C L- P
Ontario as an investment area because the underlying fundamentals are not very
: d/ O. M1 }& ?3 tstrong. This has been proven once again with the release of the latest
1 y* W. {( h" W% A, C$ tfindings. New Housing Prices have actually decreased by .5% during June 2005 -
. a( J* {) G: b, A3 {: M" {June 2006 proving that fundamental investing works in helping you pick the best7 [7 K! r0 s5 Z2 E
markets and avoid the flat ones. This .5% decrease should have little impact
6 t! r% |4 r; son average re-sale values in the Windsor region.
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+ d p1 t% I( S1 R6 @To contrast this, the fundamentals we discuss are so strong in Calgary that the- T/ ?8 \5 ?, v! g
market continues to be super heated. With close to 3,000 net new people into
! B J T7 d2 W# @3 s* E' ~7 dthe city every month, the property market just can't keep up. That is why we
B7 L% q2 d( q4 q3 s, `saw the New Housing Price Index increase by 49.2% (June 2005 to June 2006).
2 _$ w; ]8 f3 UThis is great news for the future of re-sale values in the city as these' I9 @) c. A% c/ {1 d; h# J
increases will continue to ripple out into the market for at least the next six2 f5 J/ A* G: q1 h8 s
months.
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* x) i' L, v! U6 WComparing these two regions is a great illustration of the value of not getting2 r" Y7 |6 R0 A
caught in the 'emotional guessing game' by just focusing on the underlying: S; L2 D" c( p! f1 e% {
fundamentals. It is sad to see those people who said in the last 2 years that
& }( U5 m j' \5 e9 T1 B/ F0 N P! othe Alberta real estate market was over and they were going to sit back and wait
3 b7 u) Z2 F' Q F6 H* K/ D/ Zuntil it drops. Quite obviously, they have missed out on AMAZING gains, all
0 ~3 \( G7 X( S4 M0 |because they didn't follow fundamentals, they just led with their emotions.) Y0 ^ {& V# o7 x a
% F& S' S# y- m# r# Q( W2 lBy the way, Edmonton's New Housing Price Index is up an amazing 28% so far (June
" N. g3 p$ d' u! O: @2005 to June 2006), also great news.1 d2 P/ N# b6 O# ~
( j4 k- N. i) U6 e1 u6 n( qBy comparison across the country, these are the numbers for June 2005 - June
4 u" C" c0 f9 z" b4 ~+ `; f2006 New Housing Price Index for:% K0 V/ H( g5 J; P" F0 Z
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Vancouver . . . . . . . . +5.2%& l7 N v1 R O. O5 c6 l
Saskatoon . . . . . . . . +8.5%
; O" Q# m' s9 s1 ILondon . . . . . . . . . . . +3.0%
4 j$ Z+ ~% E2 H* y% ?) vHamilton . . . . . . . . . . +4.9%
) J6 R7 @' t4 _1 XSt. Catharines - Niagara . . . . +4.9%
% t$ _& e) r0 v0 ]+ rToronto and Oshawa . . . . . . . +3.21 q! o! x) m! j# f9 _4 ?6 ~2 ~2 {
Ottawa - Gatineau . . . . . . . . . +3.1%4 D( h4 S3 ^5 t7 H# n7 C
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Fundamental investing ALWAYS makes you look like a genius - emotional investing
7 K& Z& @8 G) G( j3 k8 U9 z' w3 ngives you quick highs, but also quick lows. Well done on your focus!
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As the fundamentals have been showing all along, the Alberta market continues to
' q x- h @* r& D: O' s- Abe strong, as in-migration and job creation continues to attract people from not
# g" S9 g9 j: _, T, F* v: ?- O3 y6 ronly across Canada, but from around the world. Our average wages are) L D% Y9 a5 H: q8 ]
increasing, our population is increasing, our unemployment rate continues to/ d6 P4 m- B0 ]4 n1 b5 o3 k/ h; r
drop and our GDP growth is slated to once again lead the country.+ k v( n! P: I$ R
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Here are some very interesting facts that are helping to support the strong
3 _" R5 F) h1 E1 ofundamentals:
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* {: ^' d2 N/ G* V& h2 D! ~' v1. The Conference Board of Canada is forecasting strong economic growth in! O( X# y: q7 u0 A5 t: ~
Canada, with Alberta once again leading the way. In fact, the projected growth
$ P+ @* C+ t+ Nfor Alberta's economy is a staggering 6.6%. (BC + 3.6%, Ontario + 2.5%), and
7 q( I& Q$ q: r/ Y1 s, w5 Y! W: s$ Ethis 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
6 j# B9 W$ ^* k7 vworld. Recently, there have been investors coming here from Asia, Australia,
5 Z0 m$ z& _ { S+ \' p$ }# Bthe US, UK and Europe. In fact, if you review the world's press you will see
: v8 \7 S. `7 q5 F" E Jthat Canada (with a focus on Alberta) is being discussed more frequently. ! S0 q+ p( q) s- S0 f- D: ?
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3. Don Campbell has just returned from presenting our Canadian investment/ u: M% `$ y3 d7 @+ O
atmosphere (including Why Alberta - Why Now") to a group of major investors in
' F! I2 C: n* ~. D5 m, jDublin, Ireland, and the response was overwhelmingly positive. In fact, after8 t# X8 w, a8 t2 I4 r5 p
Don presented the economic facts, many of these investors (who could invest
/ ?* P1 }" h8 k6 Z9 p5 danywhere in the world) have already booked their flights to here. Once again
- g$ W% w# f7 W0 yproving that when the true numbers of our economy are presented (along with the2 n0 b2 u& f3 b Q0 h
political stability of our country), there is no place in the world that can
, S3 y$ r/ L2 sbeat it for long term investment.
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9 a/ ], O7 b6 I2 c. F9 r$ p2 j& i4. Job creation continues to be strong (with a small lull in June); definitely" u3 l& ~. f ~3 y# P# B
a sign of strong long-term fundamentals. RBC has also been following the job. j& ?, [# P# u4 H/ E: q; i! M$ S# \
creation situation and here is what they are saying: (www.rbc.com/economics)( B; R, n, [4 F$ ?8 L, W& M7 O
"After generating a substantial 96,700 jobs in May, the largest such gain since6 P4 l# Y5 c y j. F4 A, u
January 2002, the economy lost a modest 4,600 jobs in June...
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, p8 t2 P2 m- N1 C' C$ JStrength in the Canadian economy contributed to a gain of 215,600 jobs in the
- O2 |% Z* _ [; v/ I- qfirst half of 2006, a feat not matched since the second half of 2002. With the
" y% k2 r0 I, r: G1 A! @economy widely expected to grow at a more moderate pace in the second half of+ n" B# ]* p( `1 ?- w
the year on the back of slowing trade activity, this impressive showing may not6 M1 H# r) y! N8 g3 v6 t
repeat itself. We expect that employment grew in July at a pace consistent with: a, C5 k# ^. A# v0 h
its recent trend of 24,000 jobs a month. Assuming that the labour force grew at. u5 v2 u& z3 H
its trend rate, a gain of 24,000 jobs will lead to a national unemployment rate
* P3 h. E' I" X) S4 ?of 6.1%." Overall very good news. Now the key is to ensure that the region in
1 x' y3 M$ g$ X0 @) Qwhich 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 [, w6 D5 V! m; \9 W
economy, avoiding 'excuses' and to especially not listen to the uninformed
0 s* K8 R: Y5 E x3 q( \'dream stealers.' As long as you stick with your game plan, you continue to do! F* S# F5 H7 _- U" t1 `! A/ m( X. h) Q
your due diligence, and you remove emotions from the equation, you will see the, i2 K* g! A! `8 z3 v0 t5 B, d/ t
opportunities that are right in front of you, right here in Alberta. Let the4 e( S0 s7 U5 g( J$ A
'dream stealers' call you 'lucky' 5 years from now as your net worth has soared; f* |7 A( E# a
and your financial freedom has surpassed even your wildest expectations.
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Capital Gains Comparison.% t! m( W# O9 C$ l4 {
5 m; r; U. [1 HKPMG has recently released a comparison of the true Top Federal and Provincial, f! V! U8 j. R' Z2 E
Marginal Capital Gains Tax Rates per province. It is very interesting to see
! U, z3 o2 `4 o) ], V- i8 c/ H3 Thow these will affect your exit strategy. Here are the numbers:
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BC . . . . . . . . 21.9%
4 }' @$ N# n: }* \AB . . . . . . . . 19.5%
* K& V) X& g2 F$ Z5 G- o' k+ cSK . . . . . . . . 22.0%; w) w6 {* j! h5 [, ~* a
MB . . . . . . . . 23.2%
. }6 k' i9 t. n% @0 v: C! |, L; GON . . . . . . . . 23.2%0 `0 p7 m* k+ ]4 D
QC . . . . . . . . 24.1%
( u4 }! G0 j6 M; aNB . . . . . . . . 23.4%
+ i3 N' t8 Z8 ]NS . . . . . . . . 24.1%5 J: ~) U0 \4 Y! o
PE . . . . . . . . 23.7%
0 Z/ a2 ^0 G0 O5 B: {* rNF . . . . . . . . 24.3%) f' q6 b3 k: g9 d$ y7 z
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Lower capital gains tax increases investment and stimulates the long term
- R* ^5 P9 ]8 j5 ueconomy of the province. It also allows real estate investors to keep more of2 d6 r/ x2 {8 W1 I C
their profits at exit time. Always a good number to pay attention to.
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8 u) @$ g! a* p! AOverall, by staying focused for the next short period of time, you have the" x0 v& \/ X8 o; W6 O G: I- |2 f' M
opportunity to create financial freedom of which others can only dream. Of3 h* N% H. ]6 g2 [) s+ V
course, the key word is focus. And with an August line-up of 'Members Only'5 ?8 ~8 T$ |$ _: h) U
events like this, you can't help to become a real estate investment champion' o7 s' t8 F; l
when you take action as a full REIN Member.
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C) K+ T0 l3 J& ? x% SFocus on the fundamentals, keep emotions out of your decisions, and enjoy the9 |& }/ z5 X L0 O( [% @3 P
results in just a few short years. |
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发表于 2006-8-25 08:35
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