Sunday, September 28, 2008

I Know Who I believe

Two Merrill Lynch economist report the real estate market in Canada is on the tipping point of a US style meltdown. In fact it's just a matter of time before the crisis happens and our overextended, hyper-leveraged population is going to see the same type of economic suffering that the US economy is currently battling.

"We fear . . . it may simply be a matter of time (before) . . . housing and credit markets in Canada crack," "Markets remain overly sanguine with respect to the prospects for the Canadian housing market, the financial sector and the overall economy." Merrill Lynch Canada Inc. analysts David Wolf and Carolyn Kwan

They are certainly brave to come out with news like that.

Almost every other analyst around is refuting the chance of a US style meltdown in Canada. The circumstances are simply not the same. Although we may be over leveraged and overextended there is no comparison to the sub-prime mess in the US.

Already markets in Alberta are starting to level out and the slight declines (about 10%) we saw over 2008 are stabilizing. By 2009 the market will be balanced and we should see a decrease in the high inventory of real estate properties.

"Price advances had been supported by fundamentals - strong employment and low interest rates - not softening credit conditions. Canada's real estate market is therefore not overvalued, a finding confirmed through a recent study published by the IMF," report by Desjardins senior economist Hélène Bégin.

Friday, September 26, 2008

Time Management Part 2

Since my mom and aunt are here I am trying to maximize my time in the company, rest and show them around even more than before. It's easy to let something slide and more often than not it's the resting part. My greatest discoveries have been:

1. Schedule your day into time blocks
2. Rest is crucial- if the baby comes you need stamina to get through labour
3. Give your guests a map and set them on their way

I give myself 2 or 3 important jobs a day to do and make sure I get them done. In that way I have actually done a lot of my tasks, made time for the nap and shown my family a pretty fine time during their stay in Japan.

Only 6 days left!

Thursday, September 25, 2008

How To Invest Anywhere In The World As An Expatriate

Here is a preview of Todd's newest article on NuWire Investor. If you are an expatriate investor there are many useful points to help you increase the performance of your investment from anywhere in the world.

The DO's and DON'Ts of investing in real estate for expatriates

"The expat lifestyle has many benefits, such as traveling, living and working in exotic locations and often better compensation and benefits than that of domestic jobs. The expatriate life may be full of adventure, but one place that investors definitely don't want thrills is in large investments. High earnings allows expat investors more disposable income for investments, but whether saving for a home, planning for retirement or seeking cash-flow from current investments, expat investors face obstacles and needs quite different from those of average investors."

Read More

Armstrong Is Coming Back!

"Lance Armstrong, the seven-times Tour de France winner, yesterday said that he intends to make a second comeback to professional cycling and that he hopes to win an eighth Tour de France next year at the age of 37."

Absolutely nothing to do with real estate but a lot to do with getting out there and just being the ultimate best you can be. Lance Armstrong amazes me. His battle with cancer itself is incredible but to go on to win 7 Tour de France races after that just shows me that I am living at half-mast.

I hate to generalize but almost everyone who I meet who has beaten cancer seems to be living at a whole different level/vibration than the rest of us. I guess the second you feel like all you b&$% and complain about could be taken away nothing seems so bad - in fact it seems pretty awesome. Obviously I want to reach that level without having a life threatening illness or disease but I guess it takes everyone a huge kick in the pants to realize that the their life is probably fantastic and could be a 1000 times more so.

Read Full Article

Monday, September 22, 2008

Go Take A Look

A good way to see what is fueling the Alberta economy is to visit the Oilsands Tradeshow in Edmonton is to go to the oilsands tradeshow.
"Widely seen as a future driver of the global economy,
oil sands development sits front and centre on the global stage. This year's Oil Sands
Trade Show & Conference launches at a significant time for oil sands and heavy oil
professionals as they assemble in Edmonton to explore innovative ways to
drive environmentally sustainable energy," said Wes Scott, Event Director, dmg
world media.

Green technology and careers feature at the event. For more information and events schedule check here HERE IF you hurry you can still get a free pass by the end of today (you must be in the oilsands industry to obtain a free pass).
 Exhibition Hours:

Tuesday, September 23: 10:00 a.m. to 6:00 p.m.
Wednesday, September 24: 10:00 a.m. to 5:00 p.m.

Sunday, September 21, 2008

4 Headlines

Just scanning the web today looking at the news for Edmonton, Alberta and the economic outlook for the province and the city. It's funny I found four headlines that would leave anyone baffled as to what is really going on. It just goes to show you have to research for your own opinion and if you are reading only one newspaper your information is going to be skewed.

1. Alberta's economy slower but still better than the rest of Canada: TD economist - "I think Alberta and the rest of Canada will do a bit better next year but probably in the case of Alberta only back to [growth of] about two and a half per cent. But that's consistent with what I said last year. A slowdown in growth but not a bust."Don Drummond, the senior vice-president and chief economist of TD Bank

It's positive shows that Alberta is leading the country in performance though everywhere there is a slowdown.

2. Confidence in Alberta economy waning: Survey - "Alberta companies are less optimistic than they were at the height of the province's boom, but most still believe their business will increase in the last three months of 2008, said the ATB Financial Business Sentiments Index."

Slightly negative but it's a survey so based on perception. I guess the Alberta companies missed the above article about the national economic slowdown.

3. Saskatchewan Advantage snags torch from Alberta - ".. it is how our neighbours in Saskatchewan feel as their economy lifts off; their quality of life remains something Calgarians and Edmontonions can only envy; and their premier travels across North America extolling the virtues of his province to obviously appreciative audiences.
By comparison we're stuck in an economic deceleration that is exacerbating -- not mitigating some of our most severe issues -- while raising new concerns about what the province's economy will look like when we've finished "readjusting."

Negative? So often it's hard to tell. The journalist does point out the Alberta has zero provincial debt and is a emerging global superpower. Saskatchewan will lead the nation in some economic areas but in no way has the economy that Alberta does. Beyond that between 2009 and 2012, Calgary and Edmonton are expected to regain first and second place in average annual growth.

4. Look up Calgary! Edmonton is the new powerhouse - "The TD Bank recently came out with a study that concluded if the Edmonton/Calgary corridor was its own country, it would today be one of the most successful economies in the world, second only to Luxemburg in terms of GDP per capita."

Positive! Imagine two cities in Alberta, Canada having one of the most successful economies in the world? It baffles the mind and puts Saskatchewan into perspective. I want to email this story to all the despondent business owners in Alberta.

Thursday, September 18, 2008

Canadians Have It Pretty Good

I live a large part of the year outside of Canada and so I often forget what a fantastic country it is. My mom and aunt flew out from Edmonton and Calgary to help me get ready for the baby and the inevitable changes that are coming very very quickly. They were telling me about their medical coverage and how much the pay for certain services. I'm pretty impressed with how little money they are required to pay.

As an non-resident expat I don't have Canadian medical. I pay an exorbitant amount of money to be protected for everything from organ transplants and dental to the delivery of a child. In Japan the delivery will cost about ¥500,000 (about $5,023 CDN) my medical covers most of that but I will pay about $500CDN by the end of it. This includes the delivery, some post-natal classes and 5 days in the hospital; they don't believe in sending the mother home the next day after the delivery in Japan.

Japanese families must pay for the delivery. The city will give nearly half of the costs back but these families are expected to come up with about $3,000 CDN. That is a lot of money to come up with when you are starting a new family and one of the income producers is now out of work. I'm sure this may play a small part in the birthrate being so low. In Canada of course the whole thing would be free and we would probably pay about $100 dollars a month for our medical coverage.

Canada is really beautiful, it's safe, the people are friendly and the streets are clean. There are social services for everyone and if you are determined you can do anything you dream to do. All in all it's a pretty wonderful place to live.

Tuesday, September 16, 2008

Alberta Economic Outlook

"The Alberta government’s low-tax and fiscal responsibility policies create long-term economic benefits for Albertans. Alberta’s international competitiveness and fiscal stewardship form a solid foundation upon which the Government of Alberta’s value-added strategy will accelerate the on-going diversification of the province’s economy."

Download Here

16 Days Left

I'm sitting here at my desk, well near my desk, counting the days for my son to come. I can't quite fit in my area any more because my belly has become so unbelievably huge that I sit about a foot away.

It's just struck me that there are only 16 days left and I am not prepared! Of course I am ecstatic to see him but not really looking forward to the delivery. Although people often have more than one child so it must not be so horrible as to put women off for the rest of their lives.

I've had a great time being pregnant and can't believe that this incredible experience will soon be over. I now see what women mean when they say they would like to be pregnant forever.

Sunday, September 14, 2008

This And That

City's Psyche, like it's homes are undervalued - "Earlier this week, a national study determined that Edmonton house prices are eight per cent too low. This is an uncannily perfect statistic for anyone who seeks to understand the mysterious heart and mind of the Edmontonian."

"There is kind of a collective mentality. A malaise sets in, even if we have no intention of selling our house." Todd Hirsch, senior economist for ATB Financial

Edmontonians really have no idea what an incredible economic position they are in. The economic situation that Edmonton and Alberta are currently in is perhaps the healthiest economy in Canada.

After The Bubble Ghost Towns In America - "Since real-estate tanked, many new planned communities across the country are half-empty, with for-sale signs outnumbering residents by a large margin. Some of the projects abandoned by bankrupt developers are in places that were hotbeds of new housing construction: Southern California, Atlanta, Las Vegas, Phoenix."

Regions with economic fundamentals will weather the storm, but many other areas will continue to get worse. A 'general' correction of 25% is predicted and currently the USA is at about 15%, so in 'general' they can expect another across the board drop of 10% of house prices.

The Future Is Fantastic - "We strive at the university to really change lives with the kind of research we undertake -- whether it is in engineering, to find more environmentally friendly ways to extract oil, or in health-care fields, or in the social sciences,"University of Alberta president Indira Samarasekera

"She (Samarasekera) is confident that Edmonton can compete for talent with great academic centres such as Oxford and Princeton."

Attracting new students for an excellent education and the opportunity to influence international research is one way the university is helping to increase in-migration to the province. When these talented young graduates realize they can earn more money than anywhere across Canada they will make the province their home.

Friday, September 12, 2008

5 Fears Standing In The Way Of Expat Real Estate Investors and Success

Depending on where you make your home as an expat, you may be pleasantly oblivious to North American news. But, like a bad case of malaria the negative world of English news can come back and sucker punch you when you least expect it. Don’t let their fear paralyze you- use it to empower you.

What you’ve got to do is decipher what is ‘real’ and what is ‘imaginary’. Sober yourself by separating the truth from the fiction.
By doing this you’ll be able to free yourself from day-trader mass market psychology and its rollercoaster ride of gut wrenching twists and turns.

I’ve been living abroad for nearly a decade now and have successfully invested in more than 50 property purchases (yes, this is what I do for a living).

Here I’ll address a few common worries pertaining to property investment for expats and what you can do to solve them.

Problems and Fears facing Expat Investors:

1) I don’t know enough about the market to invest now

It’s fear of the unknown, fear of losing money, fear of feeling stupid if you make a wrong choice. This is one of the most important fears to overcome because if you don’t, you’ll never pull the trigger on an investment and end up lacking the security, freedom and lifestyle you desire. Potentially working a lot longer and harder than you planned to or heaven forbid, working until you die.

Educate yourself. This doesn’t mean spend 5 years going back to school and getting a degree. Time is of the essence. Start reading impartial books on investing, speak to successful investors and make a step-by-step plan to reach your goals.

2) What the heck do I do with my money?

After you get educated, get into action. Have you ever noticed how many ‘experts’ there are out there sitting on the sidelines and telling you the time to invest has come and gone? Analysis paralysis is a pathetic state to be in.

After certain milestones have been reached ex. 2 books have been read, 3 realtors contacted, etc. get into action. Start taking measurable steps towards investing in a property or growing your money somewhere. If doing it yourself is not an option, enlist the help of unbiased professionals that will help you reach your goals.

3) How can I invest for my retirement?

It really depends on where you are in your investment cycle.

If you’re just starting out and capital is an issue you can begin by placing money into REITs, town houses or joint venture partnerships that require lower entry points. As you acquire more knowledge and capital, look towards multi-family properties or owning several cash flowing individual units.

In some cases, paying down or paying off your investment property mortgage to generate a stream of cash flow may be wise for retirement. In certain growth markets investing for a 5 to 7 year term may be enough to generate sizable capital gains that you can deploy for retirement income and reinvestment by refinancing or using an equity take out plan.

4) How safe is real estate as an investment?

Real estate is an incredibly safe, long-term investment. Despite the Subprime mortgage debacle, there are still solid, fundamentally sound investments in the States (and abroad) to invest in. Real estate moves in cycles, with a bit of knowledge you can pin point an area of stable growth to own income-producing property.
You’ll look like a genius in 10 years. People get into trouble when they speculate and look for the quick buck. Like any business it takes time and knowledge to invest successfully.

5) Where can I grow my money without triggering a bunch of taxes?

This will depend on your nationality, tax plan, income and country that you are investing into.

The best step is to speak to a real estate savvy tax planner and ask him how it can be done. Also speak to expat investors who have done what you want to do and ask their advice. Sometimes you’ll be pleasantly surprised to find that there may even be tax breaks and tax treaties for your country (there are quite a few in Canada).

Living abroad gives you a unique perspective to be in two worlds at once. You can observe your compatriots lives back home without being a part of it. You can study the economy based on fundamentals and not emotion enabling you to seize opportunities when others are running away to hide. This is one of the many advantages the expat life offers you.

Wednesday, September 10, 2008

Busy, Busy, Busy Market

When the price and market is right the buyers will come. To investors who do their research it has always been clear that the Edmonton market is not unstable and prices aren't plummeting merely stabilizing. With so many listings on the market the pickings are plentiful and the prices are right.

"I've been run off my feet," "July was ridiculously busy and August has been ridiculously busy, and when it shows in the numbers, it's not just me.

"The stats show buyers are confident with the Edmonton economy. It's a large selection to pick from right now, and I think they don't foresee a drastic dropping of prices, so they want to get into the marketplace and buy.

"By the time we get through to next spring, we're going to have a far more reasonable listing inventory and we're going to have a far more balanced marketplace," Marc Perras, president of the Realtors Association of Edmonton

The investment deals we are getting are fantastic. Terms are more flexible and when you satisfy your sellers need they are more likely to meet you half way.

Sunday, September 07, 2008

Edmonton And Alberta Get Top Ranking

Once again Edmonton and Alberta are beating the whole country in 2007-08 for the most capital investments, job creation or/and large projects. Edmonton ranked first in Canada. Alberta got top for competitiveness.

"It means they were the most successful in attracting the most number of qualified projects," Site Selection editor-in-chief Mark Arend said today.

Read Article

Saturday, September 06, 2008

Leverage Capital 2% Down Deal - ROI 28% Per Annum

Usually our investments are break even or cash flowing but sometimes there comes a deal where the leverage is so spectacular it makes up for the negative cash flow.

With careful planning you can get into an Edmonton investment property for a 2.3% down payment, allow for negative cash flow and still have your investment under $40,000. Then take the money you saved by avoiding the conventional 25% down payment to get into another investment property. This is one of those rare gems.

Download This Great Property's Proforma or Contact Us Now To Secure This Incredible Deal

This property has an incredibly low down payment at 2.3%. Total investment capital required $37,256 is only 12% of purchase price.

However, using a conventional 25% down payment the total investment would be $82,600 this money maker would produce $78.72 in positive cash flow.

Objectives and Summary
To purchase quality Real Estate investment properties in the economic powerhouse
region of Edmonton, Alberta (Top Town In Alberta To Invest In). Here is an opportunity to leverage your capital by purchasing a quality property requiring only a $7,000 down payment, 2.3% of the purchase price. Implementing a buy and hold strategy for capital gain and equity appreciation over a 5-year term.

The Benefits
Gorgeous half duplex, two storey located in desirable South Terwillegar. The low down
payment and no condo or HOA fees makes this investment very attractive. South Terwillegar is in the southern part of Edmonton and near a main feed of the Anthony Henday ring road, not only will this positively affect property values but the convenient location will greatly improve tenant’s commute. This house is another solid equity producing investment like every investment Glenn Simon Inc offers.

*You must qualify with the TD bank to assume this mortgage.

Take A Look At Edmonton Now

Sometimes when you have a good thing you take it for granted and often treat it quite badly. As I type that sentence I don't know how many pop songs are flitting through my head. It's quite a common theme.

We do it to cities too. Let's take Edmonton it's had it's booms and busts over the years. Many complain about traffic, cost of living, lack of service, increasing taxes and house prices flattening out. Well if you look at all those things objectively they are signs of a great economy. Don't scoff.

Traffic - Increased traffic means population growth. The city is working hard to improve infrastructure and the LRT and Anthony Henday are huge projects that will relieve congestion.

Cost Of Living - It's low. Albertans still pay the lowest taxes in Canada. What you pay $1.07 for at your local Walmart might cost up to $1.13 in Ontario, $1.12 in B.C and poor souls $1.15 in PEI. Having the highest salaries in Canada doesn't hurt either.

Lack Of Service - This means the economy is booming. It's sad you can't get served as quickly anywhere but that's because we can all get great jobs at high wages. No one wants to work for $17/hr at McDonalds anymore.

Increasing Taxes - Like it or not increasing taxes is good. It means your property values are going up. I don't like and I don't look forward to that time of the year but it's unavoidable.

House Prices Flattening Out - Well if they didn't we would be in a sorry state. Affordability would drop, immigration would peter out and our great economy would slow right down. One year of healthy adjustment is worth all of that believe me. Just wait for 2009 when prices start to inch up again.

The next time you start to complain about Edmonton think of the big picture and maybe you will smile.

Tuesday, September 02, 2008

Where Does Edmonton Go From Here

If you're in the Edmonton market and feel that it's going to bottom out, the prices will be halved and we've seen it all before then you are not looking at the big picture and you need to stop reading the newspapers.

I've seen so many articles talking about the incredible amount of listings on the and private listing services but when you really think about prices didn't plummet as every pundit forecasted. In fact they leveled out a bit and now are holding steady at about 10.98% lower than last year. The prices rose 40% for single family residential homes from 2006 so we are still holding a 25%++ increase in values since 2007.

Take a look at this chart from EREB

Single Family Condo All Residential
July 2006 Average Price $303,304 $188,831 $256,489
Peak 2007 Average Price $426,028 $271,908 $354,718
Price Increase 40.50% 43.99% 38.30%
July 2008 Average Price $379,224 $253,850 $335,100
Decrease from peak -10.98% -6.64% -5.53%
Increase over 2006 25.03% 34.43% 30.65%

Looks like a healthy market that is just adjusting to keep affordability in line - we used to be the 10th highest priced city in Canada now we are around 5th. Not overpriced and not undervalued as in 2006.

EREB predicts that the market will pick up over autumn and we will see an increase in sales which will cause the inventory to decrease and over time values to increase.

So basically this sale won't last for long! If you think you'll wait until prices "bottom out" to invest then don't hold your breath - who could predict that anyway? There are so good properties on the market with motivated sellers, it's a situation that won't last for much longer.

To see some of the investment deals we've picked up in this market click here.

Monday, September 01, 2008

Finally Some Good News

I get so tired of reading negative news in the papers. If I believed everything I read I wouldn't leave my house. So it's nice to finally read something really upbeat, inspiring and frankly amazing.

A grandmother and her 4 year old granddaughter are rescued by a mysterious muscled nurse who may be from Vancouver.

"He was well-muscled, tanned, and wearing a short-sleeved wet-suit that said Vancouver, B.C."

"That's all Joanne Phillips, 59, remembers of the mysterious stranger who braved the swift currents of Washington state's Wenatchee river to rescue her and her four-year-old granddaughter Katelin from drowning." Read More