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NEW HOUSING PRICE INDEX...7 L$ H: G3 h: b2 [
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The New Housing Price Index, has just been released and it provides some very
" @+ a- }1 N- k1 Q0 Dinteresting insights, not only into where the market has moved, but where it+ T9 t7 `+ ~- @8 E
will be going.
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% F5 d @4 Y) w/ ]- |It proved, once again, the value of looking at fundamentals behind a market.7 I& d# _9 u/ y1 A! m
2 h6 x3 q4 d: V" `The New Housing Price Index is compiled by Statistics Canada and is used by
' u8 v4 e. T; y$ Hsophisticated investors to see how much the market has moved, as well as an
9 b; M, o# s2 O5 ]: u% Iindicator of where re-sale home prices will be moving in the coming six months. ) e7 o6 u) q, \6 e# Q2 ?
We look at the ripple effect that new housing prices have on re-sale property1 S) S1 @) Q; Q2 r
values and can extrapolate what direction re-sale prices will be moving and by& m3 m3 K* E/ o4 H
how much.
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For instance, for the last three years, we have told investors to avoid Windsor,
3 Z& A1 A& ^! t% W( W3 JOntario as an investment area because the underlying fundamentals are not very
1 g8 i, n% r, \% d" j, ~! Cstrong. This has been proven once again with the release of the latest
( ]& n8 n! N% h8 Q% k% F& kfindings. New Housing Prices have actually decreased by .5% during June 2005 -
; t J/ v" k' p% P" `+ jJune 2006 proving that fundamental investing works in helping you pick the best- H! V$ x" T5 S* E
markets and avoid the flat ones. This .5% decrease should have little impact
4 z/ H8 ^/ ], c# S4 j, Yon 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 the5 j( u# i4 G# E& m; M; v
market continues to be super heated. With close to 3,000 net new people into% k' _9 b$ r' Q8 I: y" S: X+ k$ A
the city every month, the property market just can't keep up. That is why we* o( M- f* g) g2 D7 M
saw the New Housing Price Index increase by 49.2% (June 2005 to June 2006).
! g* R" w. X0 Q% D- }' MThis is great news for the future of re-sale values in the city as these
/ z# o' \5 H# s2 ]* @* P) w* Vincreases will continue to ripple out into the market for at least the next six
$ i) X& i1 P6 o2 u1 o* y# cmonths.
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- W$ e' K: P$ ~' C6 C0 HComparing these two regions is a great illustration of the value of not getting5 x$ f# U6 w* ?& x
caught in the 'emotional guessing game' by just focusing on the underlying. p5 M; }" A: t( x
fundamentals. It is sad to see those people who said in the last 2 years that
; T9 {2 P: t- t5 P/ K/ Gthe Alberta real estate market was over and they were going to sit back and wait- c+ n6 U9 A2 E: n3 L9 ?8 L
until it drops. Quite obviously, they have missed out on AMAZING gains, all3 J, C! y d) I }9 O0 T/ i
because they didn't follow fundamentals, they just led with their emotions.0 j" m- K q. S) m$ i9 A
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By the way, Edmonton's New Housing Price Index is up an amazing 28% so far (June
6 I" `4 t" {3 I# @0 F2005 to June 2006), also great news.: X/ X, T0 l- |' o' [. d
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By comparison across the country, these are the numbers for June 2005 - June
" ]: O. D0 v" u* L; Y# n2006 New Housing Price Index for:
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, }+ { ?3 q5 i: ZVancouver . . . . . . . . +5.2%1 f8 e0 C7 G8 f$ e
Saskatoon . . . . . . . . +8.5%- U9 F8 r. d' k3 v1 ^& H* Y; a
London . . . . . . . . . . . +3.0%
6 W6 d$ G; q: }- GHamilton . . . . . . . . . . +4.9%
' i5 K/ G: r5 ~2 T# h% jSt. Catharines - Niagara . . . . +4.9%2 q, P% @2 i& ~
Toronto and Oshawa . . . . . . . +3.2
9 `9 s: P" e% ~8 C% U3 ^Ottawa - Gatineau . . . . . . . . . +3.1%
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9 s" m/ I" M# ~0 j6 n' u/ CFundamental investing ALWAYS makes you look like a genius - emotional investing7 m8 E8 L9 Q9 }. a. j1 ~
gives you quick highs, but also quick lows. Well done on your focus!; U. X t9 i# E9 c+ z
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As the fundamentals have been showing all along, the Alberta market continues to
3 a! I. C# e6 q: o( p( H/ ~8 Jbe strong, as in-migration and job creation continues to attract people from not; s! c' B. N- u
only across Canada, but from around the world. Our average wages are, w% C k% Z$ B' F
increasing, our population is increasing, our unemployment rate continues to
! k7 g* v- `0 y% gdrop and our GDP growth is slated to once again lead the country.* \2 F7 j& v! L$ }
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Here are some very interesting facts that are helping to support the strong
2 X7 |9 L5 ?9 Rfundamentals:
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6 F# x1 V5 m5 U, t0 o1. The Conference Board of Canada is forecasting strong economic growth in3 k! o3 }! A- n& O
Canada, with Alberta once again leading the way. In fact, the projected growth
4 H; Y9 Y( L; }8 {9 x* Nfor Alberta's economy is a staggering 6.6%. (BC + 3.6%, Ontario + 2.5%), and' b9 [- }0 a6 d: ]
this is slated to occur even with the labour shortages we are witnessing." ?7 H" I. R4 W' t# ?. ^
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2. People are discovering Canada as an investment center from all over the
- u8 m$ B6 ~- {+ Q/ h) Mworld. Recently, there have been investors coming here from Asia, Australia,; j, F- i4 K" h. F- Q! g
the US, UK and Europe. In fact, if you review the world's press you will see
5 ?# y; q$ l* T' W5 Q2 G. [that Canada (with a focus on Alberta) is being discussed more frequently. ; L9 H8 n0 z# Y: V4 h
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3. Don Campbell has just returned from presenting our Canadian investment) ]( `% L* U" V: X$ U
atmosphere (including Why Alberta - Why Now") to a group of major investors in6 ?$ _/ x8 ?9 j$ P$ n4 T
Dublin, Ireland, and the response was overwhelmingly positive. In fact, after
/ m* L( W6 _0 r. X5 CDon presented the economic facts, many of these investors (who could invest
* Z: v1 z" M" T! t* k+ r+ n- _# P Ranywhere in the world) have already booked their flights to here. Once again2 @& J. q$ x# P
proving that when the true numbers of our economy are presented (along with the
+ a- _. I8 u: D3 u4 h/ h# E4 ypolitical stability of our country), there is no place in the world that can( T4 J2 t; c3 e
beat it for long term investment.
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4. Job creation continues to be strong (with a small lull in June); definitely1 N1 G9 _% z& e7 I$ J% Z8 @5 \3 W
a sign of strong long-term fundamentals. RBC has also been following the job$ C: Y$ s1 b$ m) J+ C5 K) }
creation situation and here is what they are saying: (www.rbc.com/economics)
0 u- \) z# y. X"After generating a substantial 96,700 jobs in May, the largest such gain since# c8 i% `& H# M2 D/ J$ i
January 2002, the economy lost a modest 4,600 jobs in June... Q# T1 W& _" z- Z% c2 a
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Strength in the Canadian economy contributed to a gain of 215,600 jobs in the
/ O, q: s% v: P7 X- ^8 Zfirst half of 2006, a feat not matched since the second half of 2002. With the
7 t4 ?9 p( ~$ weconomy widely expected to grow at a more moderate pace in the second half of
+ R9 P, Q4 ~2 ]: M8 N# Mthe year on the back of slowing trade activity, this impressive showing may not
S& J" }$ N% V5 yrepeat itself. We expect that employment grew in July at a pace consistent with
# G% f2 F; t: u0 a4 b4 R4 Lits recent trend of 24,000 jobs a month. Assuming that the labour force grew at
) O! Y6 { q4 L: Bits trend rate, a gain of 24,000 jobs will lead to a national unemployment rate
3 _0 D; M- w5 Z' c$ {3 T: B9 \of 6.1%." Overall very good news. Now the key is to ensure that the region in# C3 q: R5 \ Z/ o) p s
which you are investing is continuing to generate jobs and increasing incomes.8 ] s- j2 c# `* {
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1 `, p* p! f3 NIn other words, it is a great time to be taking advantage of this strong/ H; O/ e' P4 B( a! l! [( ]
economy, avoiding 'excuses' and to especially not listen to the uninformed0 S4 r/ u2 e ~, W
'dream stealers.' As long as you stick with your game plan, you continue to do- ~ p5 A4 Y9 k! F8 J- p7 B
your due diligence, and you remove emotions from the equation, you will see the
& {6 k1 v$ L+ T2 n4 Z0 `opportunities that are right in front of you, right here in Alberta. Let the. P& F/ h% o! c
'dream stealers' call you 'lucky' 5 years from now as your net worth has soared
/ [; s. d1 q% V3 i, k2 w, b. oand your financial freedom has surpassed even your wildest expectations.
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( C/ X4 v! n" M% c& n; ^ d5 ACapital Gains Comparison., I$ ~0 E! U2 }) O; e
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KPMG has recently released a comparison of the true Top Federal and Provincial
- B# h1 }& L, l7 C/ e0 O |# p0 zMarginal Capital Gains Tax Rates per province. It is very interesting to see" D( U, w2 }, x3 f4 @
how these will affect your exit strategy. Here are the numbers:8 I0 Z F: D2 V/ M1 V# g. `
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BC . . . . . . . . 21.9%
+ ? P6 v7 f) @, v& k1 UAB . . . . . . . . 19.5%
8 f. h2 `/ F9 R( b/ j" U( I) kSK . . . . . . . . 22.0%
& f8 ^3 h+ R3 a; F, B8 bMB . . . . . . . . 23.2%$ O& J D' C! k A. Q8 G
ON . . . . . . . . 23.2%
; \5 i2 x- m: G) O3 g/ \, V* RQC . . . . . . . . 24.1%: D4 j- R% K- Z, N+ d3 j
NB . . . . . . . . 23.4%
- r; I K3 j/ f7 h% F) m. z) j9 m vNS . . . . . . . . 24.1%
! D' r; j5 K! P1 x% ^5 NPE . . . . . . . . 23.7%0 F$ b9 t' x% d V, k6 C* ]) o! o
NF . . . . . . . . 24.3% F$ t0 X4 `8 e/ Z) h
% P* v, g& H- ]$ pLower capital gains tax increases investment and stimulates the long term
$ U- |& ~* E5 [7 p. T+ deconomy of the province. It also allows real estate investors to keep more of
1 W1 X7 V/ M6 P% btheir profits at exit time. Always a good number to pay attention to.
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Overall, by staying focused for the next short period of time, you have the
2 B5 t- R% |( L8 d! N' Qopportunity to create financial freedom of which others can only dream. Of
7 n; } P6 \* {' R( Kcourse, the key word is focus. And with an August line-up of 'Members Only'4 _! P L; r4 R. o5 k7 m# S! } K
events like this, you can't help to become a real estate investment champion! T ~1 n" i! {& c9 r( D0 {0 a Z
when you take action as a full REIN Member.
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7 V8 v0 R( N( H! ZFocus on the fundamentals, keep emotions out of your decisions, and enjoy the: @, p; p3 \' {3 j2 s$ h, }- k
results in just a few short years. |
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发表于 2006-8-25 08:35
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