Glen Godlonton

Inflation rate slows in June

Glen Godlonton — Thu, 29 Jul 2010 20:40:00 GMT

Julian Beltrame

Ottawa — The Canadian Press Published on Friday, Jul. 23, 2010 7:14AM EDT Last updated on Wednesday, Jul. 28, 2010 6:48AM EDT

Canada's annual inflation rate fell to one per cent in June, the lowest level in eight months, prompting analysts to predict the Bank of Canada will move cautiously on future interest rate increases.

The four-tenths of a point drop in the annual rate was widely expected, as was the 0.1 percentage point drop in prices between May and June.

The mild surprise was that underlying core inflation, which excludes the volatile energy component, edged lower by one-tenth of a point to 1.7 per cent.

Markets had been expecting the Bank of Canada core rate to edge higher to 1.9 per cent.

Canada's central bank aims to keep core inflation between one and three per cent, so June's report moves the number further to the low end of the range.

Markets barely took notice of the monthly report from Statistics Canada.

The Canadian dollar traded in a narrow band near Thursday's 96.22 cents US close following the 7 a.m. announcement.

What the lower core inflation profile suggests, however, is that central bank governor Mark Carney will feel little pressure to ramp up interest rates.

On Tuesday, the Bank of Canada increased its trendsetting rate by 25 basis points to 0.75 per cent, still well below the country's core inflation reading and regarded as extremely stimulative.

“The main point is that the bank cannot wait until inflation erupts, but this very much argues for a very cautions, low approach to unwinding the stimulus,” said Sal Guatieri, an economist at BMO Capital Markets.

Most analysts believe Carney will hike the policy rate one more time this year, likely in September, to one per cent and then head back on the sidelines until 2011.

But some continue to be critical of the Bank of Canada for applying the monetary brakes - or easing the accelerator, as the central bank would see it - before the economy is ready to stand on its own feet.

Canada's gross domestic product followed up the strong 4.9 per cent advance in the last three months of 2009 with an even bigger jump forward of 6.1 per cent in the first quarter of this year.

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Federal deficit narrows to $4.4-billion

Glen Godlonton — Thu, 29 Jul 2010 19:28:00 GMT

New numbers from the Finance Department indicate the stronger economy is helping the federal government run smaller budget deficits than at the same time last year, as tax revenues increase.

Through the first two months of the current fiscal year, April and May, Canada's deficit sits at $4.4-billion, compared with $7.5-billion in the same period of 2009 when the economy was still in recession. Finance Minister Jim Flaherty’s budget in March shows the government projects that the $54-billion budget shortfall it had at the end of the last fiscal year will shrink to just over $49-billion this year.

The new figures released Friday are part of Finance's monthly Fiscal Monitor report, which breaks down the money flowing in and out of the government's general revenues.

The government took in $2.4-billion more in taxes during April and May compared with the same months in 2009, the report said, including a 4.2 per cent increase in personal income-tax revenues as Canada’s economy created almost 134,000 net new jobs in the two-month period. However, corporate income-tax revenue dropped by 13.5 per cent, according to the report.

About $1.8-billion of the deficit so far this fiscal year is attributable to the Conservative government's stimulus measures – called the Economic Action Plan – which includes tax cuts and infrastructure spending.

Total program expenses were $36.4-billion in the two months, a decrease of about $500-million or 1.4 per cent from the previous year. Employment Insurance transfers dropped 3.3 per cent, while benefits for the elderly increased 2.5 per cent, the report said.

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Will the recovering economy restore consumer demand for Canadian resort property?

Glen Godlonton — Thu, 29 Jul 2010 19:21:00 GMT

Steve Ladurantaye Real Estate Reporter

Cranbrook, B.C. — Globe and Mail Update Published on Tuesday, Jul. 27, 2010 7:30PM EDT Last updated on Wednesday, Jul. 28, 2010 7:10AM EDT

As Fortress Investment Group LLC struggled to keep control of its Whistler Blackcomb Ski Resort during the Winter Olympics, Rick Jensen managed to steal a small jewel from the resort operator’s crown.

The former three-term mayor of Cranbrook, B.C., gathered a group of friends and persuaded them to bid for Panorama Mountain Village, a fully developed ski hill with underdeveloped real estate potential just outside Invermere, B.C., a 3 and 1/2-hour drive from Calgary. Late last winter, Mr. Jensen’s group took ownership of the resort for a reported $27-million.

Their bold gamble will provide one of the first tests of whether a recovering economy will restore consumer demand for Canadian resort property, a market that was hammered by the recession.

The financial crisis saw many cash-strapped resort owners lose their properties to creditors or sell low to cut their losses. New owners are racing to figure out how to turn their bucolic retreats into profitable paradises.

But the appetite for pricey vacation properties hours away from urban centres is suffering as potential buyers ponder the effect that recent interest rate increases by the Bank of Canada will have on their family finances, especially as the national housing market shows signs of cooling.

After six months of sharp increases, the average residential resale price in Canada slipped to $342,662 in June, a fall of 1.2 per cent from a month earlier, the Canadian Real Estate Association said. The dip marked the first month-over-month decline this year.

That hasn’t stopped Mr. Jensen from proceeding with his plan to turn the resort – which the group bought with cash, but plans to mortgage to finance development – into one of the only ski-in, ski-out residential neighbourhoods in the region.

“We’ve made some changes that have been meant to elevate the guest experience, but what we need to focus on is development,” Mr. Jensen said. “We have a 30-lot subdivision that is in the process of being approved. We have a lot of raw land and a lot of pent-up demand.”

He hopes to offer lots for sale at around $150,000 each, with construction beginning next summer.

Like Mr. Jensen, other new resort owners are also counting on making money from real estate – the very thing that got the original owners into trouble in the first place. Most resorts were never designed to paythe bills with revenue earned from tourists. The real money – in theory, anyway – is in condo development.

Money from each condo sale can be used to finance more development, so building and selling a steady stream of new units is key to success. If people stop buying, owners often find themselves unable to service their debts.

The main reason Mr. Jensen and his group were able to buy Panorama is because a troubled U.S. real estate market devastated the balance sheet of Fortress, the parent company of Intrawest ULC , which operated the resort. Unable to make payments on $1.4-billion in debt (U.S.), Fortress had to unload assets in Canada and the U.S., but was able to refinance its debt and hold on to its prized Whistler Blackcomb resort.

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Alberta land sale nets record prices

Glen Godlonton — Mon, 12 Jul 2010 16:06:00 GMT

Nathan Vanderklippe

Calgary — Globe and Mail Update Published on Wednesday, Jul. 07, 2010 7:03PM EDT Last updated on Wednesday, Jul. 07, 2010 9:56PM EDT

A sudden surge in interest in Alberta’s natural gas helped drive record-setting prices at the province’s Wednesday petroleum land sale.

Companies paid an average of $2,084.86 per hectare – the highest amount ever paid on average for Alberta land, exceeding prices seen even in the halcyon days of 2005 and 2006.

The total sale brought in $451-million, the second highest overall tally in provincial history, and just less than a $475-million sale in December, 2005. The sale comes after another blockbuster sale in British Columbia, which saw that province net $404-million from companies chasing shale gas plays two weeks ago, and substantially boosts Alberta’s take for 2010, which before Wednesday had stood at $837-million.

“It’s certainly very encouraging,” said Christine King, a spokeswoman with Alberta Energy.

In Alberta’s best-ever year, 2005, it brought in $1.8-billion; last year it managed only $731-million.

Surprisingly, a big chunk of the most recent sales total came from three parcels of land southwest of Fox Creek, in a region dominated by natural gas production, that sold for more than $63.5-million each. The far stronger price of oil in recent months has led many companies to flee natural gas, but the land sale could indicate a shift is underway, based on expectations of a natural gas recovery.

Land sales are “usually reflective of what people’s views of future oil or gas prices are going to be,” said Brad Turner, president of Calgary-based Britt Land Services. “This is the first indication that people are seeing they can earn positive returns from the money they’re going to invest.”

Original Article

Beaches hit as Alex pushes oil

Glen Godlonton — Wed, 30 Jun 2010 19:37:00 GMT

Mary Foster and Tom Breen

Grand Isle, La. — The Associated Press Published on Wednesday, Jun. 30, 2010 12:50PM EDT Last updated on Wednesday, Jun. 30, 2010 1:43PM EDT

Rough seas generated by Hurricane Alex pushed more oil from the massive spill onto Gulf Coast beaches Wednesday as cleanup vessels were sidelined by the faraway storm's ripple effects.

The hurricane was churning coastal waters across the oil-affected region on the Gulf of Mexico. Six-foot waves and 25 mph winds were forecast through Thursday just offshore from the Mississippi Delta in Louisiana to the Florida Panhandle.

In Louisiana, the storm pushed an oil patch toward Grand Isle and uninhabited Elmer's Island, dumping tar balls as big as apples on the beach.

“The sad thing is that it's been about three weeks since we had any big oil come in here,” marine science technician Michael Malone said. “With this weather, we lost all the progress we made.”

The loss of dozens of skimmers, combined with gusts driving water into the coast, left beaches especially vulnerable.

Large waves churned up by Hurricane Alex left Alabama beaches splattered with oil and tar balls Wednesday, even with Alex more than 500 miles away as it approached the Texas-Mexico coast. Long stretches were stained brown as far as 60 yards from the edge of the water.

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Summary of Flaherty's mortgage changes

Glen Godlonton — Sat, 20 Feb 2010 01:41:00 GMT

By Paul Vieira, Financial PostFebruary 16, 2010 7:03 AM

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QUALIFYING FOR A FIVE-YEAR RATE

The adjustments to the mortgage framework will require mortgage insurers to ensure that new borrowers qualify for a five-year fixed rate mortgage when calculating the gross debt service and total debt service ratios. The measure is intended to protect Canadians by providing them with additional flexibility to support mortgage payments at higher interest rates in the future.

LIMIT THE MAXIMUM REFINANCING

Borrowers seeking financial flexibility can currently refinance their mortgage and increase the amount they are borrowing on the security of their home up to a limit of 95% of the value of the property. The adjustment will lower the maximum amount of the mortgage loan in a refinancing of a government-backed high-ratio mortgage loan to 90% of the value of the property, consistent with the principle that home ownership is a tool for savings.

DISCOURAGING SPECULATION

This measure will require a minimum down payment of 20% for government-backed mortgage insurance on non-owner-occupied properties purchased for speculation. At present, borrowers may purchase a residential property with a 5% down payment. The change will require a 20% down payment for small non-owner-occupied residential rental properties. Borrowers purchasing owner-occupied residential properties which also include some rental units (such as a duplex) will still be able to access government-backed mortgage insurance with a 5% down payment.

New Mortgage Rules for Alberta, and all of Canada

Glen Godlonton — Sat, 20 Feb 2010 01:35:00 GMT

On February 16^th Finance Minister Flaherty, announced some changes to “insured” mortgage lending in Canada. These changes affect mortgages insured by CMHC, Genworth and AIG United Guarantee.

From the Globe and Mail: Finance Minister Jim Flaherty Tuesday announced tighter lending standards for mortgages, saying that while the housing market is healthy and there's no solid evidence of a bubble, the moves are needed to “help prevent negative trends from developing.”

The intent of the changes is to preserve the integrity of the Canadian Housing Market and to ensure Canadians will continue to find housing affordable despite the increases in interest rates which we must be prepared for.

Gentles Comment: From sixteen economists we could hear twenty opinions and some suggest that fixed rates could begin to rise before the end of June 2010 in anticipation of increases to Prime beginning in the third quarter. Others suggest that based on the growth in GDP, employment rates, money market and bond yields, exchange rates and analysis of past recessions -- that the rise in rates will not be before mid 2011. Sorry – no crystal ball on this one. How high will rates go? There seems to be some consistency of opinion that rates will peak 3-4% higher than rates today.

So if the 5 year is 3.89% today then rates could double. What does that do to a mortgage payment in 5 years? Here is a rule of thumb:

$300k mortgage, 35 years. At end of 5 years on the outstanding balance, if interest rates double then payments increase by 50%.

We don’t have all the details yet but here is a summary of the changes and my comments on how these changes will impact borrowers. The effective date of the changes is April 19^th, 2010.

There will apparently be exceptions granted after April 19^th where they are needed to satisfy a binding purchase and sale, financing, or refinancing agreement entered into before April 19^th, 2010.

Change: The debt servicing or “affordability ratios” will now be calculated using the 5 year fixed rate even if the mortgage is to be for a shorter term or if the mortgage is going to be on a variable or adjustable rate.

Gentles Comment: In Canada the affordability or debt service ratios have been calculated using the 3 year rate for many years. The intent was to make sure that even as rates changed that our Canadian homeowners would not be subject to large “payment shock”. So this change is fairly minor. It was in the United States that borrowers were qualified on very low rates for floating rate mortgages. The Canadian Government has not yet clarified whether they expect lenders to use the 5 year posted or the 5 year discounted rate. As a benchmark those rates today are 5.49% and 3.89%. The three year rates are 4.5% and 3.5% respectively. It was not uncommon for lenders to use the 3 year posted rate for qualification purposes. Many Canadians did their pre-approvals based on the 5 year fixed rate anyways; even if they did choose a floating rate mortgage once they had selected the home they wished to purchase.

Before the housing crisis in the US the “90 days arrears rate”, counting mortgages with payments 90 days overdue was 2 in 100. At the same time in Canada the 90 Day Arrears Rate was 2 in 1,000. Today the Canadian rate is only 3 in a 1,000 but the US rate has increased dramatically to 9 in a 100. So clearly, the level of concern in Canada is nowhere near the level of concern in the US.

Change: Refinances will be limited to 90% of current market value vs. 95% of current market value.

Gentles Comment: 95% refinances of insured mortgages have only been possible for a short period of time in my experience very few people have refinanced to 95%.

Change: The minimum down payment for investment or revenue properties has increased from 5% to 20%. This does not apply to someone buying two sides of a duplex or all three or four units in a tri-plex or four-plex where they will be occupying one of the units.

Gentles Comment: The high ratio (CMHC) insurance premiums have always been considerably higher on revenue property as compared to owner occupied property. As a result we have used strategies such as equity takeouts on principal residences or other revenue property, or 2^nd mortgages, to achieve 20% down payments on revenue property and avoid the CMHC premiums altogether.

Certainly these changes will impact some borrowers. It may take some first time buyers a little bit longer to become prepared for their first purchase, their first mortgage. As mortgage professionals we are pleased that the Government did not increase the minimum down payment to 10% and did not reduce the maximum amortization to 30 years. These ideas had been on the table for discussion.

I encourage existing mortgage borrowers to look at strategies to pay down their principal faster. Always happy to share ideas.

If your current mortgage rate is 5% or higher and your renewal is within the next 2-3 years then it may make sense to pay the penalty now to renew for a new 5 to 10 year term at today’s rates. Again, we are always happy to walk through the analysis with you.

If you, or other homeowners are carrying non-mortgage debt at rates 8% to 18% to 28% then it could certainly be worthwhile to look at a refinance. We’ve helped people achieve significant reductions in interest expense, we’ve improved cash flow and some of that cash flow has gone into paying off principal faster.

The market is excellent for buyers also. Adjustable rate mortgages at Prime minus .35% with 120 day rate holds and the opportunity to “lock in” for 5 years or longer at any time without cost or penalty; based on the 5 year rate in effect on the day you make the decision to “lock in”.

We look forward to your call. Thank you.

Brian Gentles AMP

Alberta Broker - Alberta Regional Manager

Mortgage Sub-broker – British Columbia

Home n Work Mortgages Inc.

Licensed Mortgage Originator in Alberta and British Columbia

Direct Calgary 403.216.8302 Toll Free 1.866.273.6192

Fax Calgary 403.398.1401 Toll Free 1.866.273.6194

Alternate Fax 403.238.2240 Mark Attn: Brian Gentles

e: brian.gentles@telus.net

e: brian@briangentles.com

w: www.briangentles.com

iPad: Can it live up to the hype?

Glen Godlonton — Thu, 28 Jan 2010 02:18:00 GMT

The Apple 'iPad,' a new tablet computing device, sits on display after its launch event in San Francisco on Wednesday.Photograph by: Kimberly White, ReutersAfter weeks of speculation, Apple unveiled its iPad tablet computer Wednesday, marking the company's most breathlessly anticipated product debut since the iPhone. So will Apple's latest offering live up to the hype? "I do think it's a game-changer," says Sidney Eve Matrix, a media professor at Queen's University in Kingston, Ont. "I think it's going to be more exciting than the iPhone because I think it will enable us to do more than the iPhone could do for us. This will take the lid off a whole new world of third-party applications and ways to connect socially." The iPad won't simply replace our laptops or smart phones, she says, but will instead carve out its own distinct category as a "companion device" that takes mobile social computing to the next level. Weighing less than 1 kilogram and measuring just 1.5 centimetre thick, the iPad operates with a touch-screen keyboard on a 25-centimetre multi-touch screen. Prices will range from $499 (U.S.) for the 16-gigabyte version to $699 for the 64-gigabyte model, and 3G mobile Internet access will cost an extra $130. They're scheduled to begin shipping in 60 days. "iPad creates and defines an entirely new category of devices that will connect users with their apps and content in a much more intimate, intuitive and fun way than ever before," Apple CEO Steve Jobs said at the launch in San Francisco. Alfred Hermida, a journalism professor at the University of British Columbia, believes the true impact of the iPad will only become evident over the long term. When a new technology emerges, it's often difficult to know how it will be used, he says, and many of the technologies that stick — including the Internet — end up being used for purposes other than what was intended. When he got an iPhone, he says he didn't make his first phone call for four days because there were so many other options to explore before he got to the device's purported reason for being. "That's the beauty of what the iPhone does," Hermida says. "It's like a blank slate and what I find exciting about these types of devices is that it's hard to predict what they're going to be used for because they can be used for so many things." Apple essentially creates "objects of desire" that can be customized to any purpose or target market with the content loaded onto them, he says, and there's no "killer app" that's going to make or break it. The iPad could become a mobile, 24-7 digital photo frame, he suggests, or a mobile music laboratory that allows people to mix and share elements of songs they buy on iTunes. "With Apple devices and a lot of new technology, we tend to underestimate the long-term impact," he says. Several companies unveiled new tablet computers at the Consumer Electronics Show in Las Vegas earlier this month, says Richard Smith, a professor at the school of communication at Simon Fraser University, but they didn't generate any of the hype the iPad did, and that's Apple's genius. The iPad is "good, but it's not shockingly outlandish," he says, but he believes it will end up changing the game in the same way the iPod did. Both debuted after other MP3 players and tablet computers hit the scene, but Apple produced a beautifully designed product that operated more smoothly and quickly dominated the market, he says. "It's not like they invented this scenario; they've just done it right," he says. Even the tantalizing bits of iPad information that leaked out of famously secretive Apple before the big reveal fed the company's carefully calibrated marketing machine, Smith says, but that carries hefty expectations, too. "You have to follow through," he says. "If it isn't as good as what they imagine, they'll just trample all over you."

Real Estate Investment Courses

Glen Godlonton — Fri, 22 Jan 2010 00:54:00 GMT

Unlock the Vault
...7 Secrets to RSP Investing
Every Investor Must Know

... Plus, An Exclusive Interview, Very Special Economic Updates, CMHC Insider Info and Exclusive January Guest Offer!

Greetings, Glen

Hopefully you had a great Holiday Season with plenty of time to relax and be with family. We all need that down time every once in awhile to recharge, but now it's back to business. In just a few short days the massive REIN™ All Day Conference is coming to Calgary, do whatever you can to come out in person. Before I get into the complete details of the Workshop, here is the info-nugget if you don't have time for the whole story. Mark it in your calendar:

REIN™ Members' Only Workshops

**Calgary All Day Workshop**

Date: Saturday, January 23rd, 9:00am (arrive at 8:30am for networking)
Location: Telus Convention Centre, 120 9th Avenue SE

Map Here

Subjects:

A Behind the Scenes Look at the Canadian Mortgage and Housing Corporation (CMHC) - REIN™'s Own Insider...Get Your Deal Done
Don R Campbell Delivers Key Insights into the 2010 Market. See What's Coming and Plan Accordingly.
Where is Alberta Headed and Will You Have Tenants? Alberta Minister of Employment and Immigration in the Flesh.
7 Secrets to RSP Investing - How To Access the Hundreds of Billions Trapped in RSP Funds to Your Advantage
Winnipeg - All Hype Or Real Opportunities? Discover the Truth Around the Winnipeg Real Estate Market, Residential and Commercial!
What's Truly Behind The Economic Curtain for 2010 - Don R. Campbell
And Much Much More

Special Offer

A Great Opportunity to Bring a Guest

The Calgary All Day is a fantastic opportunity to share your REIN™ education with a fellow investor or interested family member. Every month we have very limited guest seats available for those that would like to get a feel for REIN™, and for the All Day we're just about sold out. However, your guests do have a special opportunity this month - not only is it a full day of learning...but this month they get more: Buy One Get One Free. If you have a guest that is interested in attending the All Day event they too can bring a guest for no additional charge OR they can split the cost and come for half price.

The lineup of speakers is huge, the topics of utmost importance and what a great networking opportunity to boot. Please feel free to forward this email to any interested parties and they can sign up for one of the remaining guest seats before they're gone.

Click Here To Grab a Seat For Your Guests

Now on to the January REIN Workshop Details:

Behind the Scenes Look at CMHC... Just What Does It Take??

It's no secret that funding investment properties has become more difficult over the past year and a half. The pendulum went way into the red and has yet to come back from the massive knee jerk we all experienced. But with that said, deals can get done...you just need to know how.

If you invest in real estate then you've heard of Canadian Mortgage and Housing Corporation, CMHC, especially if you've attempted to go the road of smaller down payments. For some, CMHC is simply out of the question - "why would I spend thousands for CMHC insurance?" But in the end, most investors just don't understand enough about CMHC to move forward confidently...causing many investors to walk away from great deals (and losing money).

This month we have REIN™'s very own insider from CMHC out to dispel the myths, bring you the real facts and provide you the confidence and knowledge you need to get the deal done. The truth is CMHC can help you get deals done that would otherwise cost a lot more with private money or wouldn't get done at all... now you'll have the confidence and knowledge to move forward.

The Money Trap... Solved! Unlocking Hundreds of Billions for Your Investments.

Let's talk RSP's...and before you shrug it off, before you say "RSP's are just too complicated" hear me out. Right now there are hundreds of billions of dollars, yes billions, if not more, tied up in RSP's - sitting there earning average Canadians below average returns. You may even have a sizeable RSP portfolio of your own...that probably took quite a hit over the past year. And I'd bet you've wondered just how you could access that money for a down payment.

We brought in RSP expert and long time real estate investor Greg Habstritt to demystify the RSP world, to give you the real goods. There are secrets to RSP investing that all investors must know, especially if you've hit that money wall, and some of the strategies out there you should flat out run away from!

It's Time to Take Control of Your Future & Tap Into
Hundreds of Billions of Easy Investment Capital

Discover the Exact Tools You Need to Unlock the RSP Vault

Click Here for Your Exclusive Interview

There are myths, misconceptions and downright lies when it comes to RSP investing which is why so many investors have shied away. Don't be fooled...be informed! Greg answered a lot of questions during our interview and shed some real light on the world of RSP investing...and that's only a preview to his brand new presentation that you'll see at the Calgary All Day.

A brief list of answers you'll get at the All Day:

· What is the approximate size of money sitting trapped in people's RSP's and how you can you tap into these locked funds

· Why the mutual fund industry may be designed to keep Canadians from maximizing their ROI

What are the advantages and disadvantages of using RSP money to invest?

· What are some of the risks with raising money from other people's RSP's?

· Can I use my own RSP's to invest in my own Real Estate, how about family and friends?

· Do I need to be an experienced Real Estate investor to raise money from other people?

· The 'magic words' to instantly increase your cash flow

· How many different strategies are there to using other people's RSP's?

· What are some of the first steps we need to take to get started?

Click here for the exclusive interview...

Be sure to come out in person the get the first glimpse of this brand new presentation. If money has been your limiting factor this just might be your silver bullet!

Winnipeg - Fact or Fiction?

There is no doubt you've heard about investment opportunities coming out of Winnipeg. "I hear Winnipeg is the next big boom" "You can get properties for nothing" "Every property cash-flows" and the list goes on. No matter the season someone is always trying to find that next "it" town...is Winnipeg the one?

It's time to get the facts on the Winnipeg market and whether or not it should be on your investment radar. We're bringing in two of Winnipeg's most connected and long term investors to give you the goods on where the market is headed and where the opportunities are...both residential and commercial. Before you follow the hype get the facts!

Immigration and Employment...Where Does Alberta Stand?

I don't know about you, but having tenants is a wonderful thing in this business...and employed tenants are even better. This month we have Alberta's Minister of Immigration and Employment out to give us the facts surrounding these two key fundamentals. Will Alberta's population continue to grow and will that growth be supported by new jobs? As an investor you must stay up to date on this information and what better way than right out of the horses mouth??

What's Behind The Curtain For 2010 and Beyond?

And of course, let's not forget the 'Real News' with Don R Campbell. This month Don goes the distance as he covers not only the Alberta and Canadian economies, but he also dives head first into key insights for the upcoming year. Expanding on the key fundamentals surrounding Alberta's market Don will explain in detail just what's going on, both micro and macro, and how it all ties into your bottom line. You don't have to be a researcher or an economist...we walk you through everything you need to know to make 2010 a great year.

It is a FULL day of investment training and learning with a huge dose of power networking thrown in...You can't afford to miss. Plus, we have other key presentations not mentioned, including a huge surprise for all REIN™ members...let's just say it's another REIN™ only deal this time involving medicine - hint hint.

Do whatever you can to come out in person and start your year off in a big way

Hope to see you there!

See you there,

Ray Reuter
Client Service Manager
Real Estate Investment Network

P.S. Don't forget to claim a seat for your special guest, there are only a few guest seats left. And remember, for the Calgary All Day if you purchase one guest seat you can bring a second guest for no charge - it's buy one get one free OR split the cost and save half!

Here's an idea - bring two of your neighbours who have hefty RSP's...they just might fund your next deal (or deals)!

Click Here Now to Grab Your Guest Seat Or forward this email on to someone you care about.

Housing starts increase in Calgary and across Canada

Glen Godlonton — Fri, 22 Jan 2010 00:50:00 GMT

The seasonally adjusted annual rate1 of housing starts reached 174,500 units in December 2009. This is an increase from an annual rate of 164,800 units in November, according to Canada Mortgage and Housing Corporation (CMHC). Actual housing starts for 2009 are being verified and will be reported in the January edition of Monthly Housing Statistics. They are expected to be lower due to low monthly rates earlier in the year.

“The improvement in housing starts was broad based in December,” said Bob Dugan, Chief Economist at CMHC’s Market Analysis Centre. “Solid increases occurred in both single and multiple starts to end the year.”

The seasonally adjusted annual rate of urban starts increased by 6.6 per cent to 157,100 units in December. Urban multiple starts increased from 72,800 units in November to 77,700 units in December. Single urban starts increased by 6.4 per cent to 79,400 units in December.

December’s seasonally adjusted annual rate of urban starts increased by 17.8 per cent in Quebec, by 15 per cent in Atlantic Canada, by 8.7 per cent in British Columbia and by 2.9 per cent in Ontario. The rate of urban starts decreased by 3.8 per cent in the Prairies.

Rural starts were estimated at a seasonally adjusted annual rate of 17,400 units in December2.

As Canada’s national housing agency, CMHC draws on more than 60 years of experience to help Canadians access a variety of quality, environmentally sustainable and affordable homes. CMHC also provides reliable, impartial and up-to-date housing market reports, analysis and knowledge to support and assist consumers and the housing industry in making vital decisions.

1. All starts figures, other than actual starts, are seasonally adjusted annual rates (SAAR) — that is, monthly figures adjusted to remove normal seasonal variation and multiplied by 12 to reflect annual levels.

2. CMHC estimates the level of rural starts for each of the three months of the quarter, at the beginning of each quarter. During the last month of the quarter, CMHC conducts the survey in rural areas and revises the estimate.

View original article

Secondary suites a primary concern

Glen Godlonton — Fri, 22 Jan 2010 00:38:00 GMT

Although perhaps not a visible as the issue of snow removal, which appears to be the concern du jour, the seemingly innocuous issue of secondary suites has emerged as one of the more lengthy debates down at City Hall.

Often providing an affordable housing alternative for new Calgarians, students or just those on a tight budget, secondary suites (also referred to basement suite, mother-in-law suites or granny suites) can be found in many of Calgary’s more established communities.

However, due to a council which finds itself rather divided on the topic, and the tragic death of three Calgarians who died when a fire erupted in the secondary suite they were renting, the issue of secondary suites and the regulations surrounding their application and permission is not one that appears to be going away anytime soon.

Much of the difficulty, at least in Calgary, when it comes to homeowners gaining proper permission from the city for secondary suites they have installed in their homes surround the fact that, as it stands, most applications requite the rather onerous process of changing the land-use designation for the residence.

“It’s certainly a much simpler approach in most North Canadian cities,” said Ward 7 Ald. Druh Farrell, who sits firmly on the pro-secondary suite side of council. “We’ve been discussing this for some years now, and I believe one of the reasons it’s so complicated is council. We’ve made the rules so difficult that it’s virtually impossible to get [secondary suites] through.”

The result of this complication, according to Farrell, is that many of the owners that may have otherwise gone about securing the proper permits for the suites in their homes simply operate them on an illegal basis. Although the city is quick to point out that illegal suites (those which are not properly permitted) and unsafe suites (the type evidenced in the three deaths last January) are completely different entities, the trend for owners to not even attempt to gain permission for suites in their properties is rising.

“With the message that we’ve been giving, it’s burying the issue again,” said Farrell. “It’s pushing these units underground, because why would anyone want to go through the process of legitimizing their unit when you’re pretty much guaranteed a failure at council?”

Proof of just how tricky it is to gain permission for a suite can be seen in the votes down at City Hall. In a process that requires each individual suite needing to be approved by council, a December vote on three applications saw two of them (including a proposal from city-owned Calgary Housing) rejected, largely on the basis that allowing the quite would create a secondary suite in a neighbourhood where only single family homes exist.

One of the biggest supporters of that very argument is Ward 2 Ald. Gord Lowe. During his time on council, Lowe has been very vocal on the issue of secondary suites, and believes that the surrounding community should be consulted before any secondary suite is given the go ahead by the powers that be.

“The biggest single commitment most people make in their lives is their house,” said Lowe. “In the established communities, people buy a house doing the due diligence knowing what’s going to happen around them, and I don’t think that government should change that without consulting the community.”

One of the ways that Lowe believes secondary suites can be implemented into more communities is through the use of area redevelopment plans (ARPs). In the city’s newer communities, ARPs are introduced in the planning stages, but in established communities where everything is already in place, altering zoning laws and designations is a far more arduous process.

Lowe suggests that a more streamlined ARP process could take the concerns of community residents into account while proving to be far less restrictive than the measures currently in place.

In addition to the city’s concerns of zoning and land use designation, Lowe says that the more tangible concerns of those residents already in place must be taken into account when contemplating allowing secondary suites in a given area. One the applications turned down by the city in December was for the community of Rundle, where 72 per cent of the homeowners on that cul-de-sac signed a petition against it.

“Very often in the developed communities, because of the way they’re laid out, you can have parking and traffic problems. Plus the fact that if you built your house anticipating living in a single-family area, before we change that, I think government has a duty to ask what you think about it.”

However, Farrell believes that the concerns stated by Lowe are simply masking the same “not in my backyard” mentality that arises amongst some Calgarians anytime a change, however small it may be, is proposed in any community.

“Council is having a very knee-jerk reaction to a very small group of people who don’t want [secondary suites], and the people who don’t want them usually aren’t very specific about what concerns them.”

Citing a recent poll that suggests that as much as 85 per cent of Calgarians support legal secondary suites, Farrell says that by making it so difficult for homeowners to gain permission for secondary suites, the city has encouraged the growth of the those very same illegal suites that draw the ire of community residents.

“The community in Rundle has a lot of illegal suites that are in very poor condition, so that’s the issue for Rundle. How do you solve it? You can’t shut all those suites down. If we’ve got an affordable housing problem now, it would be exacerbated [by doing so], but we should shut them down, because they’re not safe. But we must replace them with something. There’s a need for them, and somebody’s filling the need.”

Whatever the cause for all the complication and confusion, from the standpoint of those who actually enforce the laws down at City Hall, it’s up to council to figure it out.

“The decisions really rest with council,” said Laurie Kimber, land use bylaw coordinator for the City of Calgary. “Council looks to us for advice and recommendations, and certainly administration is going to respond to that.”

View Original Article by Cody Stuart

Alberta inflation takes breather at 2.1 per cent

Glen Godlonton — Mon, 22 Dec 2008 01:07:00 GMT

A break in gasoline prices and a few deals at the mall drove inflation down in Alberta again in November, with consumer prices inching up 2.1 per cent from a year ago.

While deals were sure to be had at the gas pump, where prices were down 12.4 per cent, consumers did have to dig a lot deeper for necessities such as fresh fruits and vegetables, natural gas and shelter costs.

ATB Financial senior economist Todd Hirsch attributed the price jump in fruits and veggies in part to a weaker Canadian dollar.

However, he noted November's overall inflation rate is a continuation of a downward slide that started in June, when inflation in Alberta was 4.4 per cent.

"Alberta's inflation figures are being swept lower by falling commodity prices, especially crude oil and gasoline, but also by softer consumer demand," he said.

Still, Canada's inflation was two per cent in November, the first time in two months that Alberta's inflation edged higher than the nation's.

Released Friday, Statistics Canada's Consumer Price Index for November showed that the price of food in Alberta was up 7.3 per cent on a year-over-year basis, led by a 29 per cent jump in fresh vegetables and an 18.8 per cent jump in fresh fruit.

The price of cereal puffed up 15.2 per cent, and meat, excluding poultry, rang in 12.6 per cent higher. Natural gas rose 6.4 per cent. Shelter costs were also up, 4.3 per cent.

Calgary saw a 2.4 per cent rise in consumer prices in November on a year-over-year basis, while Edmonton had 2.2 per cent.

Yellowknife was the highest at 4.7 per cent, and Saint John, N. B., the lowest, at 0.7 per cent.

Regionally, still-booming Saskatchewan experienced the greatest price pressure with the annualized

rate rising to 3.2 per cent. Last week, the Bank of Canada cut its trendsetting lending rate by 75 basis points to 1.5 per cent in an effort to stimulate the economy.

"Overall, this somewhat complicates the Bank of Canada's outlook, as by our calculations it seems as though core CPI could remain above the two per cent level for several months to come," said Charmaine Buskas, economics strategist at TD Securities.

"That said, the bank is still going to focus on alleviating the strains on the economy due to the global economic recession and ongoing turmoil in the credit markets," she added.

Gina Teel, Calgary Herald; With Files From CanWest News Service;

Published: Saturday, December 20, 2008

http://www.canada.com/calgaryherald/news/calgarybusiness/story.html?id=3f43f4a6-1268-4633-ad74-c6abd84f5450

Rental market feels economic pinch

Glen Godlonton — Mon, 22 Dec 2008 01:00:00 GMT

Headlines continue to inform us rather harshly that housing sales are down. According to Canadian Real Estate Association figures, Alberta experienced a year-over-year decline in MLS sales of almost 35 per cent, while prices dropped by 4.2 per cent to $338,354. And new construction is also drastically down.

That means a big increase in the number of people renting accommodation.

Bob Dhillon, president and CEO of Calgary-based Mainstreet Equities has a good handle on the rental market--his company owns more than 5,600 units across Canada; 1,300 of those in Calgary and 1,800 in Edmonton.

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Dhillon says that sector has been particularly strong over the last quarter but yet has been far outweighed by foreign contract workers.

The majority of his new renters are from Mexico and the Philippines; they find it easier to rent for the time they are working in Canada. He has 17 men from the Philippines working for his own company, which includes a construction division.

Mainstreet specializes in purchasing apartment blocks and upgrading to today's high environmental standards.

Although he owns units from the coast to Ontario, Dhillon says he is concentrating on the Alberta market, where he finds a good amount of rental stock for sale.

His latest acquisition is a 48-suite block in Cochrane--one of Canada's fastest growing cities.

Cash position is excellent and Mainstreet is taking advantage of the decrease in share value to buy back its shares for $6.25 (they currently sit at $5.83).

City Search caters more to the executive renter and it also reports a thriving business.

Canada Mortgage and Housing Corp. says that Calgary is the most expensive city in Canada for rental properties. Our average is $1,148 per month for a two-bedroom apartment (the same apartment would be $1,095 in Toronto).

But that figure is low according to the type of accommodation that City Search leases and manages.

It does have condos in the $1,200 to $2,000 range, but most of its properties are in the west downtown and Eau Claire districts, which fetch quite a bit higher.

Most newer condos in those areas can ask between $1.75 to $1.90 per square foot, which is down about 30 cents from last year. Furnished units rent for around $2.50 per square foot but in today's market, there is a fair amount of negotiating going on.

Armelle Kilpatrick, associate/vice-president property management, says most of its clients are executives and engineers on contract to Calgary companies, generally for two to three years. She says employers today encourage contract workers to rent rather than buy, which avoids having to help sell homes should they want to relocate them to another area.

Many come from the U. K., France and India, and those from the U. S. are happy to rent instead of trying to sell their homes back in the States during this depressed time.

The company currently has around 250 condos, town houses and houses in its portfolio, with most of the single family homes being in the Mount Royal, Rideau/Roxboro, Britannia and Elbow Valley communities.

Its 15 homes in the Mount Royal area are rented out for monthly costs of between $6,000 to $8,500 unfurnished, but partially furnished houses realize from$8,500 to $12,000.

Kilpatrick says people owning property in the more exclusive areas of Calgary are shying away from selling right now, so using an agency like City Search to lease, collect rent and manage makes such good sense. [ Sponsor Content ]

But to get down to our average of $1,148, there must be many apartments, duplexes and houses available for a lot less and a quick check with the Herald's classified section shows a number of suites available for way under that mark.

Within walking distance to the downtown office core you can find several in the $750 to $1,000 range and even homes in outlying districts for around the city average.

David Parker, Calgary Herald

Published: Saturday, December 20, 2008

http://www.canada.com/calgaryherald/news/lifeathome/story.html?id=c6fc35da-8a85-491f-975d-998389a8f1a7

Stars 'lining up' for regional transit network

Glen Godlonton — Mon, 22 Dec 2008 01:00:00 GMT

Each morning, Mike Rogers catches a bus at a stop four doors from his house.

"I pay a pretty huge premium," he says of the $240-a-month fee, "but it's worth it."

The daily service, operated by local charter bus companies, is offered in several communities surrounding Calgary, including Okotoks, Cochrane, Chestermere and Airdrie.

Not only is it convenient for the hundreds of commuters who use the service, it also relieves the pressure on Calgary's congested roadways and crowded C-Train cars.

With thousands of residents from outlying centres using Calgary's roads or transit every day, some municipal officials suggest bedroom communities should contribute toward the city's growing infrastructure costs.

"Calgary already picks up a disproportionate share -- for example, 12 to 15 per cent of our transit users live outside the City of Calgary,"Mayor Dave Bronconnier has said. "That is being picked up by Calgary taxpayers."

This summer, the provincial government announced a$2-billion public transit fund focused on regional co-operation.

The plan will be aimed at building public transit infrastructure, including projects such as buying new buses and trains, building regional transit and buying land for rail corridors.

Calgary city council will ask the province to pay for the $2-billion southeast leg of the LRT through the new fund, and hopes to improve its chances of getting funding by including commuter buses to neighbouring towns in the plan.

Unlike the private buses that Rogers catches each weekday, these ones would be publicly funded and seamlessly connect the bedroom communities directly to the nearest Calgary transit station.

Once there is a large enough population, the buses could be replaced by a passenger rail service connecting Calgary with Cochrane, Airdrie, Okotoks, Strathmore and potentially even Canmore.

Rick Butler, executive director with the Calgary Regional Partnership, which represents local communities, says the provincial money could go a long way to improving transportation in the region.

"The stars are lining up,"Butler says, noting the group had just received a $500,000 grant to explore new transit options when the provincial government announced the$ 2 billion for regional transportation networks.

The partnership, made up of 18 communities and one First Nation in the region, is also looking at water usage and land-use planning in southern Alberta.

Even companies running the existing private bus service between Calgary and several bedroom centres see a rapid transit commuter system as a good first step.

"Any time you put buses on the roads and take cars off the road, it's a good thing for everybody," says Tom Jerersek, general manager of Southland Transportation, which runs the commuter service from Cochrane and Okotoks.

Rogers, however, begs to differ.

He worries that any attempts to integrate such services will leave more passengers stuck in already crowded C-trains and transit buses.

"It would become too convenient," Rogers says. "It will get overused. More people would start to use it.

"The fear is that a rail system would probably increase the amount of people in Okotoks."

Colette Derworiz, Calgary Herald

Published: Friday, December 19, 2008

http://www.canada.com/calgaryherald/news/story.html?id=6a4e0f33-a486-46d1-a7db-0c2761e551f8

City's high-density projects stir debate

Glen Godlonton — Thu, 18 Dec 2008 19:53:00 GMT

Citizens averse to multi-family units in their neighbourhoods

The LRT line is ugly and in the wrong place.

That multi-family building will add too much traffic to the neighbourhood.

A highrise near an LRT station doesn't fit, causing cars to cut through the community.

[ Sponsor Content ] Similar complaints from Calgarians are heard often as the city attempts to move forward on plans to add more transit and increase the number of people living in established areas.

Those already living there --usually in single-family neighbourhoods-- aren't in favour of change and city council sometimes gives in to the dissent. It's a fine line between Nimbyism and legitimate concern about neighbourhood-altering projects.

As the city tries to build up, rather than push further out, these battles become increasingly vital. Adding multi-family units to existing community neighbourhoods are almost always accompanied by people worried about esthetics, traffic or access.

Getting around initial community disapproval is a barrier the city must overcome as it moves to put more people within its existing boundaries.

"It's human nature to get used to what's around you,"says David Watson, the city's general manager of planning, development and assessment. "Another one of our biggest challenges is that although people say they like the idea of (densifying neighbourhoods) it's always somewhere else, seldom next door.

"We have to help people through the changes that take place."

Even the local poster-development for mixed-use, high density communities--Garrison Woods --was opposed by neighbours in the planning stages. New fire stations, including one downtown, were both met with residents offering "better" locations.

Ald. Druh Farrell, a proponent of transit-oriented development, which aims to put high-density residential and retail around LRT stations, says the key to selling often-unpopular projects is good design and more communication with the affected neighbours. "Density is seen as an impediment. The positive aspects are not communicated," she said.

Individual alderman have to stop looking at development around LRT stations as community projects, she says"These aren't ward issues. (Transit-oriented development) is a city-wide issue and requires a thoughtful, consistent approach," Farrell points out.

Kim Guttormson, Calgary Herald

Published: Monday, December 15, 2008

http://www.canada.com/calgaryherald/news/story.html?id=f613e4db-0c46-4ce2-988c-a7f444d88989