Monday, 17 January 2011
Property regarded as one of best investments, research suggests.
Buying property is regarded as a better investment than many other including savings plans and buying gold and shares, research suggests.
A holiday home is as valuable, if not a greater investment option than a pension or savings plan, according to an annual survey carried out by holidaylettings.co.uk. It found that 26% of Holiday Lettings advertisers said that their primary reason for purchasing a second home was as an investment, instead of a pension or savings account.
It also found that more than half, 52%, said their primary reason for letting the property now was out of a need to cover the running costs, 26% are letting the property to make a profit while 22% opt to let it because they do not use it enough themselves. ‘In the height of the property boom when the majority of today’s holiday home landlords purchased their second homes, property was indeed an attractive long term investment and it is therefore no surprise to see that around a quarter of our customers made that choice,’ said Kate Stinchcombe-Gillies, spokesperson for holidaylettings. ‘What has changed is the increasing need for the property to pay for itself, either to pass time until the market revives and a profitable sale can be made, or to ensure that the home doesn’t cost when it was intended to fund a future lifestyle. What these accidental landlords support in the meantime is growing demand for private rental holiday accommodation,’ she explained.
Meanwhile the latest research from the Worldwide Property Group reveals that property is believed by many, to be the best place in which to invest your hard earned cash. Results from the company’s latest confidence tracker survey show that a huge 72% of people who took the survey currently believe property to be the best investment, making it easily the most popular choice. Gold was in second place at 16% whilst shares trailed in third place with just 11% of the vote. The survey, which covers several aspects pertaining to the property sector, also revealed that 77% of respondents consider this to be a great time to invest in UK property, with 64% also of the opinion that many overseas property markets represent a great opportunity to invest right now.
In fact, just over half of the people who took the survey are currently considering buying a property overseas with the USA and Caribbean by far the most popular regions. Spain and France also ranked highly. It has consistently produced strong returns for investors over the longer term and during a downturn there is even more potential to achieve great returns,’ said Kevin Wilkes, Managing Director of the Worldwide Property Group. ‘The United States is currently a very appealing market with some incredible bargains, especially for those people who can afford a cash purchase. With property often selling at below build cost, this is a market that deserves investor’s attention. My tip for 2011 would be to make this the year that you invest. Don’t leave it too late and miss out on some of the best opportunities we have seen in decades,’ he added.
Report compiled by International Investment.com
Friday 3rd December 2010
A Positive Property Call. Really.
BloombergIt isn’t often that you see an upgrade of the European commercial property sector, so I think its worth flagging up some of the thinking behind a report from Morgan Stanley. In short, if you have a strong view that inflation is coming in, it’s time to use M&A to load up on property.
While the report is a sector upgrade, it should be noted that it’s more of a tactical move than a long-term sector call. The key argument put forward is that the liquidity boost from quantative easing, combined with relatively attractive affordability levels will at least support capital values, which the analysts expect should produce 16% upside for the sector in the next 12 months.
As with many calls, the argument centers on one major factor, in this case inflation.
There have been four major property bull markets in the past 45 years, three of which have been driven by inflation and one by credit (this last, of course, being behind the most recent spike).
However, now is when it starts to get difficult, because Morgan Stanley holds a pretty different view on inflation to that of the Bank of England.
It should be noted that recent performance of the U.K. authorities at forecasting inflation has been less than perfect, with CPI outstripping Bank of England forecasts for the past couple of years. While the BoE expects a gradual slowdown in CPI, falling to around 1% by the end of next year, Morgan Stanley expects inflation to remain high at 3.2%.
Given its higher inflation expectations, MS is therefore forecasting rate increases in the U.K. during the second quarter next year and in early 2012 in the euro zone. This affects the sector because, historically, the six months prior to the first rate hike have been positive for property stocks.
Apart from impending inflation, it should be noted that the other argument put forward to support the case, is that real property yields remain high compared to real bond yields, with real spreads of around 7.5%. This spread was last seen during the 1990s property slump.
It should be said, of course, that it is quite possible to imagine potential deflationary scenarios within the euro zone, which would be strongly counter to the Morgan Stanley viewpoint.
In a recent piece, Willem Buiter, chief economist at Citigroup, says of the sovereign crisis, “we have only seen the opening act, with the rest of the plot still evolving.” Therefore, it remains a real possibility that there could be some form of European debt restructuring, which as David Rosenberg from Gluskin Shelf notes, “would be a devastating deflationary shock for the global economy, for at least a few months.”
Given this level of uncertainty, it’s perhaps understandable that many fund managers are sitting on their hands and are currently underweight in the sector. At the same time, many European stocks are performing like the U.S. Housing Index and are as flat as a pancake, suggesting that a major move is likely (I don’t know in which direction).
This article originally appeared on Dow Jones Investment Banker.
Number of new homes in UK falls 23% in a year
Friday, October 29, 2010
The number of new homes built in England fell to a record low in the past year, down 23% on 2008/9...
Just 128,680 net additional dwellings were provided in 2009/10 compared with around 167,000 in 2008/9. The previous record low was 130,510 in 2001/02. Numbers fell on the previous year in every English region. The North-West saw the largest annual decrease (38%), followed by the South-East (32%).
The figures were published by Communities and Local Government just after the Coalition announced large cuts to housing budgets in the Spending Review. Housebuilders across the country have been warning that action is needed to halt the decline and avoid deepening the housing crisis.
Five months after scrapping housing targets, local councils and builders are still waiting for the introduction of the new national planning framework and the promised New Homes Bonus incentive for housebuilding.
Stewart Baseley, chairman of the Home Builders Federation, said: "There is no doubt that the previous planning system was not succeeding in delivering enough homes - but housing delivery, crucial to solving the housing crisis, is not yet increasing, and in many areas has actually fallen.
"These figures reveal the extent of the housing supply problem and the need for real action now, cutting red tape and implementing incentives so we can build the homes the country needs."
Source: www.estateagenttoday.co.uk
Impact of spending review on housing market
Thursday, October 21, 2010
Chancellor George Osborne's highly anticipated spending review has finally been made public, so let's check out the impact the range of spending cuts and additional funding will have on the housing market...
George Osborne has unveiled the biggest UK spending cuts in decades, telling MPs in the House of Parliament that 'today is the day that Britain steps back from the brink.'
The review, which was announced yesterday at 12.30, after being veiled in secrecy and controversy for months, outlines a series of cuts designed to 'bring sanity to public finances.'
In a bid to cut the country's deficit, the main focus of the review was the slashing of £7 billion from the welfare budget. Osborne said, "We have chosen to spend on the country's most important priorities - the health care of our people, the education of our young, our nation's security and the infrastructure that supports our economic growth," he said.
Housing: Review requests
Prior to the unveiling of the review, Boris Johnson Mayor of London, David Orr Chief executive, National Housing Federation, Campbell Robb Chief executive, Shelter and Sarah Webb Chief executive, Chartered Institute of Housing submitted an open letter to the Guardian newspaper welcoming George Osborne's 'recognition of housing as a frontline service.'
"It is now crucial that the comprehensive spending review translates this recognition into the delivery of high-quality, good-value, affordable housing. Every £1 invested in housing saves the public purse double elsewhere. "The impact of poor housing on health and education of families will mean those improvements are undermined without supporting the delivery of new homes. "Housing is crucial to sustaining the economic recovery, providing much-needed jobs in both construction and the wider supply chain. But as the IMF has highlighted, our housing market remains fragile.
"Continued investment into new housing is therefore vital to bolster confidence, ensure we have quality homes to match existing infrastructure improvements and, above all, tackle the affordability crisis. Delivering more affordable housing will not only help families make homes in our neighbourhoods, but it will also reduce the reliance on expensive, often substandard private rented temporary accommodation, which has pushed housing benefit bills to £20bn a year," read the letter.
Housing: Review reality
Osborne has announced a more flexible social housing system - for existing social tenants, rent levels will remain unchanged, but new tenants will be offered intermediate rents at around 80 per cent of the market rent.
"The age threshold for the shared room rate in housing benefit will rise from 25 to 35, so that housing benefit rules reflect the housing expectations of people of a similar age not on benefits," said Osborne.
The Chancellor also announced a £4.4 billion package of capital funding which will enable the government to build up to 150,000 new affordable homes over the next four years.
Report by http://www.themovechannel.co.uk
Bargain prices in 26 key US real estate markets attracting an increasing number of foreign buyers
Tuesday, 12 October 2010
US bargain property rises Sellers are cutting the asking price on almost half the properties for sale in the US in 26 markets and particularly in Florida, research shows.
One result is that real estate investors from Europe, South America, Asia, Russia and the Middle East are finding bargains.
The price cuts on 47.8% of the housing inventory tell just part of the story, according to California based online real estate brockerage ZipRealty. It says 25% more prices are being cut than a year ago and the properties that are discounted have had their price slashed at least twice.
The median reduction amount was $19,165, or 7.25% of the listing price and the heaviest discounts are in Florida. Miami sellers have cut prices by 12% on average, the highest discounts of any market. Double digit discounts are also found in Jacksonville and Orlando.'The summer home selling season never kicked in this year, leading anxious sellers to slash prices,’ according to ZipRealty.
The bargain prices in Florida are attracting a large number of overseas buyers who have always been high in the state. Many are buying condos and renting them out until the real estate market recovers, according to experts. The foreign bargain trend accounts for less than 10% of US home sales, but experts say it is spreading fast. Real estate agents are now specifically marketing to foreign buyers and are hosting special trips.
One example is The Viceroy, an upmarket condominium complex in downtown Miami. Since January, 262 of the Viceroy’s 372 units have sold of which almost 90% have been bought by foreigners paying in cash for properties that are 52% cheaper than the peak of the market in 2007. Then units sold for $670 per square foot, now it is $319. Individual investors from Argentina, Canada, Colombia, France, Israel, Italy, Norway and Venezuela have all been buying in Florida. ‘I have never seen such a high concentration of foreign nationals acquiring real estate. Some 80% of the sales in downtown Miami are foreign based. This is unprecedented,’ said Peter Zalewski, of consulting and brokerage firm Condo Vultures.
Other hotspots for foreign buyers include Washington, New York, Las Vegas, Los Angeles and San Francisco. In Seattle, Asians are buying properties without viewing and in New York some 25% of buyers at the Armani-designed 20 Pine building, near the World Trade Center site, are from overseas. In Phoenix there has been growing interest from Canadian buyers. With the Canadian dollar approaching parity with its US counterpart, the prices are deemed highly affordable. Along with the increase in foreign interest is an increase in those willing to help buyers who want to buy unseen. These include property search companies, letting agents and even those that will chase tenants if they don’t pay.
According to the National Association of Realtors some 28% of brokers have worked with at least one international client, up from 23% a year ago. Among those, 18% had completed at least one sale, compared with 12% in 2009. Many tell real estate agents that they would normally invest in the stock market but see property has a better medium to long term bet.
Report from Property Wire
Tips for renting an overseas property
Tuesday, September 14, 2010
Whatever your situation is - whether you are buying now for retirement five years down the line and you'd like to rent your place out when you're not there, or perhaps you just want rental income, and won't use the property personally, making the most of the rental potential is a no-brainer.
1) Price vs. Rent. The price you pay for your home determines your rental yield (gross yield is simply the annual rent, divided by the property price). You factor in running costs (maintenance, monthly fees, and taxes) to get the net yield. The less you pay for your property, the higher the yield. It's that simple. This is where fire sales and distressed properties come into their own. You'll pay less for these properties than your neighbour...and command similar rent levels.
Compare short-term versus long-term rentals too. For short-term, you'll have higher running costs, from utilities to cleaning costs to management fees. In addition, you'll have to fully furnish and equip the property. Conversely, in many markets, long-term rentals come unfurnished, and the renter usually covers utilities and cleaning costs.
If you plan to use your home as a vacation or retirement property, rental yield is not top of your list of priorities, but it's crucial to get this right if you're an investor. Remember though that a low property price isn't everything. The other side of the equation is rental income. In a market with an over-supply of rental properties, you'll face competition, and likely get a lower rental income. A $100,000 property can achieve very different yields, depending on location.
In general though, you should consider the rental income to be somewhat fixed, for your property type, in your location. Whether it's better to rent short-term or long-term is usually a decision based on what's in demand in your market...and whether you plan to use the property part of the year. So the best way to make sure your yield is high is to pay the lowest purchase price you can.
2) Location. I always stress the importance of having a property in the right location, and with a rental property, you need to pay even more attention. You need to have the right property in the right location for either the short-term or long-term market...and the location that's best for those markets may be different.
Here in Panama City, there are 4 prime short-term rental locations, where you'll do better with a 1 or 2-bed condo. Suburban areas, where you'll rent long-term, favour larger condos, or houses. Ask property management companies what they rent, where, for what time periods, and for how much...and which units achieve the highest rent and highest occupancy.
Sometimes a property's best rental potential is not one you'd think of yourself-professional offices and small businesses will rent large centrally located residential apartments in Montevideo, for example. Speaking with real estate agents and property management companies...and checking the local newspapers and online rental ads...will give you a good market overview.
3) Competition. Of course, you need a market with strong demand, and (ideally) little competition. For short-term rentals, that means a lack of hotel rooms and short-term rental condos. For long-term rentals, look for a shortage of rental condos or houses in an expanding area...or a gap in the market (a 3-bed home close to a good school or financial centre, for example).
Your short-term rental won't do so well if it faces competition from 21,000 hotel rooms in the same city...with hoteliers slashing prices in the lean years and throwing in free nights, free meals, or free drinks...
Check not just the current number of hotel rooms and rental units in a market, but planned supply. In a slow market where owners can't sell, many switch to renting. If that slow market has thousands of condos due for completion...or thousands of hotel beds in the pipeline...your rental yield will suffer.
A good way of checking out what kind of demand you'll get for short-term lets is through hotel occupancy rates.
4) Occupancy. Don't rely entirely on tourist numbers for this. Tourist numbers include locals returning home...cruise ship passengers...people visiting family and friends. These groups will never rent a property, but can make up half the tourist numbers in many countries. A better reflection is hotel occupancy rates. Produced by local tourism authorities and some global hospitality groups, the figures give you a feel for the market.
These figures will change though, as the market evolves. Panama City hit a hotel occupancy rate of 84.7% in 2007. Today, it's around 50%, due to the economic slowdown in the US, and an increased number of hotel rooms.
5) Market. Widening your market of potential renters helps keep your rental yield up. If you focus on one particular segment, you'll be vulnerable in a slowdown of that segment.
Locations that attract a combination of tourists and business travellers...or those that bring domestic and foreign tourists...will give you a more consistent short-term yield. For long-term rental, look to destinations where snowbirds stay for 3-6 months of the year-or where companies bring in business executives or embassy staff, for longer periods.
6) Property Management. Unless you plan on living close to your overseas property (and by close, I mean within a couple of hours drive, tops), don't attempt to do this yourself. Find a good, bilingual, local property manager. Find out what their rates are. For short-term, expect to pay anything from 15%-40% in fees. Check what that covers-whether they will find tenants, do check-in and check-out, pay utilities, or deal with 3am plumbing emergencies. (And yes, it is worth paying more for that...unless you like the phone waking you at 3am to sort out a problem thousands of miles away).
Long-term, management fees usually run to 50% of the first month's rent, and then a low monthly charge thereafter (5%-15%, on average).
A good management company makes all the difference to your occupancy, and rental income. Ask how many units they currently manage...how many staff they have...what systems they have for handling reservations, queries, and reporting problems. Do they have a large client base already-or are they a start-up with no track record?
Some managers are much better than others with marketing and advertising their properties, online and in print. Ask their occupancy rates for your type of property, in your area, and the rental income.
That gives you an indication of what you can achieve. Ask for referrals from owners using the company, and get feedback from them.
Make sure the manager uses legally-binding rental contracts-have your attorney check that out.
Many managers have separate fee structures for "rental management" (the finding of tenants) and "property management", including the services above. This arrangement works to your advantage if you are finding the renters, or if the renters are coming from multiple sources. If a company only finds you a tenant they normally charge the equivalent of one month's rent for their services.
7) Can you Rent? Have your attorney check if you can actually rent your property out. Some countries (Colombia, for example) restrict short-term rentals of 30 days or less in residential buildings, by law.
If you're in a condo building, or a private community, check out the bylaws-they may not allow you to rent your property out. In Brazil, many condo blocks are set up for rental-with social areas, restaurant space, and a reception area in the lobby...but it's up to the owners as a group to decide if they want to allow rentals in the block...and the majority decision rules.
8) Taxes. Investigate your tax liabilities. Tax on rental income varies widely in Latin America, from zero in some Caribbean tax havens, to 30% in Costa Rica. Find out if you can offset some overhead against that tax in the form of deductions. Ask your attorney about property tax rates (again, they vary from zero to 3% on average of the official value of the property). Find out if there are any other taxes-wealth tax, or luxury tax, or school tax-that apply to you.
If you plan on sending the rental income back to your home country, ask if you'll incur any extra retention or withholding taxes associated with those transfers.
Remember, you may still have tax obligations in your home country.
This isn't an exhaustive run-down of everything you need to check before renting a property out-but it gives you a good starting point. Investigate a market carefully before deciding on the best type of property for rental yield, and the best location.
Investors: first find the market that's producing the best returns...then find the right property to give you the best performance in that market;
Retirees, or those who want to rent pending retirement or relocation: Decide where you want to live in retirement and the property you want to own...then pick the rental market that will perform best for your property type.
Get an attorney to analyze the fine print of contracts, local legal requirements, and taxes. Hire the best property manager you can afford.
Most importantly, don't rely on rental income to cover a mortgage on the property or your own daily living costs-that's a sure-fire recipe for stress. Instead, think of rental income as a bonus...a way to cover your costs of ownership or help to fund your overseas dreams.
Written by Pathfinder's Margaret Summerfield for www.themovechannel.com
The party's over in Spain - Let the bargaining begin
Friday, August 27, 2010
After a decade of runaway demand and floods of cheap money in Spain, Spanish real estate developers took their eye off the ball - they took on more debt and risk than they should have, overpaid for land and over built - it was quite the party on Spain's costas, but today there is the mother of all hangovers and there are serious bargains to be had...
Unemployment in Spain is topping 20%. There are few buyers. Some Germans are still buying second homes here... but the domestic market, and British and Irish buyers, have all but disappeared.
The market has stalled. There isn't enough space to house redundant cranes. They are being scrapped, or auctioned off and shipped to China. Banks control 50% of the real estate that is on the market. A sense of fear pervades. This is classic crisis investing territory. We could profit...or just buy our Spanish dream home for cents on the euro.
Crisis investing means buying when everyone else wants or needs out. At an aggregate level, markets overreact and overshoot both on the up and downside. Assets become mispriced.
In Spain, banks lent to developers to build. Developers built in anticipation that there would be no problem selling their units. They thought the good days could never end. Then everything stopped. Credit and financial crises combined with major oversupply. Sales dried up.
Today, banks need to purge their loan books. Spanish real estate agents aren't happy campers. Here's the way things play out. The few buyers that are around find their property through a real estate agent. Then, they look for finance from a Spanish bank. The bank discourages the buyer by offering a paltry loan...maybe 40-50% loan to value. Then, out comes the good old bait and switch...the bank offers the buyer a property that's on their own books for maybe 50 cents on the euro-and make the buyer a great loan offer.
Many real estate agents have all but given up selling to anything but cash buyers. Outside of poaching buyers from real estate agents, the banks aren't at all savvy at selling the huge amounts of real estate they now own. The result is a market in disarray. The result is that amazing deals can be done direct from banks for the sophisticated buyer who knows how to deal with the banks.
Spain is as desirable as a place to vacation or retire as it was three years ago. Last year, Spain greeted just under 60 million foreign tourists (only France fared better). Beach, golf, skiing and culture can all be on your doorstep. The only difference to three years ago is the price tag. You can find your dream retirement or second home for a fraction of what you would have paid in 2007.
Exciting times. We need to keep our heads, and focus on quality, however. Look to the most desirable areas...areas with intrinsic value. Remember my three golden rules.
-Buy quality (location, construction, amenities and fit-out)
-Don't take on any construction risk...buy completed units
-Don't take on any project risk...make sure the condominium is functioning
Half-built projects dot the coast. Forget it. Look for high quality, completed units where the condominium is functioning. I'm focused on areas like Granada, and high-end destinations on the Costa del Sol. Granada has intrinsic value and hasn't experienced over-building to the same extent as some of the costas. The most desirable parts of Marbella and Malaga should be the first to recover once some demand recovers.
If you have an interest in Spain, you should pay attention to the crisis opportunities in the areas I've mentioned. You can buy quality assets here for cents on the euro. Now is the time to start looking.
Written by Pathfinder's Ronan McMahon for www.themovechannel.com
Second home markets 'bright spot' in UK
Friday, August 20, 2010
Second home developments have been one of the brightest spots in the UK new-build market through the recession and into the recovery, according to Knight Frank...
In a new study, the estate agent finds that the number of second homes in Britain reached record levels of 245,384 in 2009, with a further rise to over 250,000 expected in 2010, as more people opt to spend their holidays in the UK.
Growing demand for self-catering accommodation has inevitably boosted rental yields, with good quality holiday lets typically offering between 5% and 7% gross.
Knight Frank's head of residential research, Liam Bailey, comments: "The recovery from the recession has coincided with a trend for taking holidays in the UK despite a succession of three damp summers between 2007 and 2009."
He adds: "The fashion for ‘staycations', as holidaying in the UK has been dubbed, has been inspired partly by a weak pound and partly out of environmental concerns."
Mr Bailey also points out that potential returns from holiday lets are now a "huge draw", allowing buyers to look upon a second home as an investment, rather than a luxury.
Source: www.homemove.co.uk
Economic woes drive overseas property interest
Tuesday, August 03, 2010
The Capital Gains Tax hike and the start of the summer holiday season have had no real impact on interest in international property... According to the latest Primelocation International Search Index, total searches for overseas property were down 7% in June but up by 138% on the same period last year.The website therefore claims that financial pressures in the UK haven't dampened interest, adding that other research indicates that one-third of international property searchers are looking to relocate abroad permanently. The UK's uncertain economic outlook could therefore be acting as spur for international househunters, particularly as many Britons are now facing more years in the workplace before retirement.
The firm's international development manager, Ann Wright, comments: "The data, taken in conjunction with the results of the MyHomeLife panel research, indicates the increasing diversity of the international property market, encompassing investment buyers, relocators, semi-permanent movers as well as traditional second-home owners." She adds: "While transactions have not yet recovered fully to return to their pre-crash levels, with finance and buyer caution remaining an issue in many cases, this broad range of different buyers is undoubtedly an important factor in explaining the current stability of the international property market." In related news, The Financial Times has reported that in June, Eurozone mortgage borrowing increased at it fastest pace in almost two years, indicating that confidence in property markets across the EU's 16 member countries is returning.
Source: www.homemove.co.uk
Real estate mogul Donald Trump now eyeing former Soviet republic of Georgia for investment potential
23 July 2010 2010
Entrepreneur and property mogul Donald Trump is considering real estate investments including casinos and golf courses in the former Soviet republic of Georgia.
He has sent Michael Cohen, executive vice president of the Trump Organization, to the country to sound out possibilities after being impressed by the country’s President Mikheil Saakashvili on a recent trip to New York.
The Republic of Georgia is not the most obvious location for a lavish Trump Tower development but Cohen believes there are two possible locations one of which could be suitable for one of the group’s flagship Trump Tower luxury hotels.
Cohen visited 13 potential development sites and said he was impressed by the Black Sea coastal town of Batumi. It is largely an unknown destination outside central Europe but is a popular destination for tourists from Central Asia due to a temperate climate and proximity to the Turkish border.
‘I’m here to walk the land and smell the dirt. My trip comes after Mr. Trump was impressed by the conversation they had about the future of Georgia. We’re looking for profit from Georgia,’ he said during a three day fact finding trip to the country’s capital Tbilisi.
He has also visited the Adjara region on Georgia’s Black Sea coast. He refused to reveal what kind of investments Trump might be interested and said it would depend if there is something he likes.
President Saakashvili was in the US in April and met with officials including New York Mayor Michael Bloomberg. The Georgian leader has stepped up efforts to revive foreign direct investment, which fell 51% in 2009 from a year earlier to $759 million as the global economic slump curtailed appetite for emerging markets.
The Georgian government has also been looking to the Middle East in particular for investment money. Deals worth around $1 billion over the next three years have already been agreed with the United Arab Emirates.
Qatari Diar Real Estate Investment, part of the UAE’s sovereign wealth fund, has also conducted a fact finding trip to Georgia but the company hasn’t announced its investment plans.
‘Maybe what’s stopping them is that they don’t have a brand. With a name like Trump, with the money and the domestic brand group, it sounds like a winning proposition to me,’ said Cohen.
Cohen said that the information he has gathered will now be evaluated to see if there is enough wealth creation potential. If so the company’s internal development team will visit the country.
Part of the evaluation process will involve looking at whether or not Georgia has enough rich people to invest in projects and the potential to attract wealthy visitors, most notably from Russia, India and China.
Source; Propertywire.com
UK: Land prices rising at fastest rate in 5 years
May 11th, 2010
The value of residential development land in England is increasing at its strongest rate since 2005, according to a new report.
Average residential land prices rose by 11.5% in the year to the end of March and in the last three months quarterly growth was 2.4% for urban land and 6.6% for greenfield land, the Knight Frank Residential Development Land Index for the first quarter of 2010 shows.
Source: Property Wire
Turkey: Star of the East
Wednesday, March 10, 2010
Turkey has maintained stability during the financial crisis and is in the throes of a well-regulated property boom, according to Standard and Poor's.For Turkey to receive a credit rating upgrade amongst almost 100 downgrades from Standard & Poor's is something to be proud of. Careful Government policy has steered Turkey calmly through a turbulent 2009 and decreased its debt levels.
The nation can be confident of a solid financial sector, in spite of external pressures, and according to Standard & Poor's credit analyst "Turkey's banking system will be one of the strongest and least-leveraged in Eastern Europe." The agency even expects to upgrade the country again over the next one to two years should it continue to weather the global turmoil and reduce its dependence on external funding.
Spain meanwhile is the last large world economy to find itself still mired in recession. Its GDP continues to shrink prompting Standard & Poor's to put the country on a negative outlook in December last year. The agency has little confidence in Spain reducing its Government deficit from 11.4% of GDP to the eurozone limit of 3% and could even apply further downward pressure to its ratings should the authorities not take aggressive action to tackle its weak economic growth and near 20% unemployment.
Daniel Dias for developer Signature International, commented: "At the moment Turkey is certainly in good shape and all of this bodes well for Turkey's constant endeavour to become part of the EU."
Source: www.signatureinternational.co.uk
Property in France: the new hot spots
Friday 26th Feb, 2010
With prices falling, there has never been a better time to snap up a historic French property.
After a few years of flirting with "emerging" markets that have now retreated into obscurity, British buyers are tentatively dipping a toe into overseas property again. But this time we are sticking resolutely to what we know and there are few places more familiar and safe than France.
"The big news is the Brits are back," announces Paul Humphreys from Knight Frank's French department. "It's a good time to buy. French property prices have fallen and there's a nice supply of good-quality properties at the right price on the market, in places we've always had love affairs with, such as Gascony and the Dordogne."
"The Paris market will come alive in springtime. Now is ski season, but prospective buyers are starting to come down from the Alps into the south of France to sniff around," Paul adds. Besides the country's aesthetic charms – the vineyards and châteaux, the food, culture and countryside – France rates highly on practical points, too. Its proximity (good for the growing band of airport-haters who prefer to drive or take the train), international appeal (a bonus for holiday lets), weather (who isn't dreaming of sunshine right now?) and a weakening euro are all helping to rekindle our love of our nearest neighbour.
"It feels as though people are returning to old values. Better the devil you know," says Patricia Fevrier, director of newbuild specialist A Place in France.
So what are the top five French regions that we are rediscovering?
1 Gascony and the Dordogne
"The Dordogne is as the British imagine the countryside should be," says Harris Raphael from Pioneer France, who attributes its continuing appeal to its beautiful, relaxed setting – with rivers and bastide market towns – and a southern French climate without the coastal crowds. "We've seen an increase in enquiries and sales since the end of late 2009, mainly families with children looking for a holiday home and couples in their fifties thinking of retirement in a few years," Harris adds.
Knight Frank reports interest from commuters seeking a family home in France, where the husband can fly back from Bergerac or Bordeaux airports to an office in London.
The grandiose 12-bedroom Château La Tuque on the banks of the Dordogne might suit those planning to make the move in style. It's on sale for £2.17 million through Knight Frank. Local agency Pioneer France also has some classic châteaux on its books, including a 17th-century mansion with 16 bedrooms in Sarlat, set in 20 hectares, for £5.08 million.
They also have more affordable propositions, including a restored three-bedroom house near Belves, in honey-coloured stone, with a large double-volume stone barn, new heated pool and outstanding views, for £308,000.
If the Dordogne seems relaxed, you should see Gascony which is all about its slow pace (it clearly works – Gascony residents live longer than anyone else in Europe, attributable to the relaxed lifestyle and the Madiran red wines).
There are rolling fields against a backdrop of the Pyrenees and market towns that evoke Tuscany or the Cotswolds – only with cheaper properties. "There's a Spanish influence, with bullfighting in some towns, and an Alpine feel, too," says Paul Humphreys, who is marketing the region's landmark Château d'Arricau-Bordes near Pau, once owned by the musketeer d'Artagnan. "It's on sale for £3.18 million, which would buy you a five-bed villa in the south of France, not a piece of history like this."
Interest from prospective buyers is returning to pre-credit crunch levels, says Ian Purslow from Purslows Gascony estate agents, "and unlike the Dordogne, where you will hear nothing but English voices in some villages, buyers in Gascony spread themselves thinly across the region," he says.
But they still like to recreate elements of English life abroad. "It's a good climate for gardening, which you can't often do in Provence and there's the English prep school Château de Sauveterre, an outpost of Cothill House in Oxfordshire, which attracts families to the area," Purslow says.
For those thinking of relocating, a budget of £500,000 will buy a restored farmhouse with a pool in a market town such as Marciac (famous for its summer jazz festival), Vic-Fezensac or Mauvezin.
2 The Loire
For many, this is quintessential France, a land of rivers, châteaux, gastronomy and golf. The Loire is home to the well-known Les Bordes course in Orleans, ranked the second-best golf course in Europe.
A 15-minute drive away in the Loire valley, set around the region's oldest course, is Golf de Sologne, a new development on a 180-acre estate with a 19th-century château that is seeing a £2 million conversion into a private members' club, restaurant and 10 apartments costing from £122,000. New cottages from £135,000 and villas (prices to be released) are also being built in the grounds.
"It appeals to younger families as it's a lovely, safe estate with brand-new properties that you can buy on a leaseback basis with guaranteed rental returns," says Robert Green from Cluttons Resorts, which are marketing Golf de Sologne.
Also key to the Loire's allure is its proximity to Paris, 90 minutes by train at present but soon to be 35 minutes via a new fast link. "People who buy in the Loire are not looking for 320 days of Mediterranean sunshine or beaches. They want wine, architecture, history and they like being near Paris," says Roddy Aris from Winkworth France.
If a historic château, ranging from £1 million to £6 million, is a little over-budget, you can buy a beautiful five-bedroom country house in Sarthe, with landscaped gardens and vineyards, for £338,000 through Winkworth France.
3 Cote d'Azur
Property prices on the coast fell by about 15 per cent last year, but St Tropez remains the most robust of resorts, with planning laws banning building within 300 metres of the sea constraining supply. The investment-minded head to Nice, where sales to English buyers so far this year have included a £450,000 studio flat on the Promenade des Anglais, purely for high-end corporate lets and a small holiday flat in the Musicians Quarter for £225,000, reports Kirkor Ajderhanyan from Agency 107 Promenade.
"We're seeing a mixture of Brits with seemingly bottomless pockets looking for sea-view properties ranging from £150,000 to a few million all along the coast, while investors are looking for reductions and properties with great rental potential," he adds.
Patricia Fevrier from A Place in France adds that buyers want the certainty of a resale market, a given on the Cote d'Azur. "French buyers are particularly fond of newbuild properties," Fevrier says. "Buyers also want to know they can let out their property if they need to and what yield they will receive, something they didn't consider so vital a few years ago." Nice, adds Fevrier, is particularly popular among those wanting a pied-à-terre with good rental potential. Prices start from £150,000 for small apartments in Nice's old town.
4 Provence
For those who want to be within an easy drive of the Cote d'Azur but pay 20 to 30 per cent less for their property, Provence still has some pockets to be exploited by expats. "The housing stock has a sensational quality and the art galleries attract a lot of Parisians and celebrities who don't want to be on the coast," says Paul Humphreys from Knight Frank.
"Prices here fell by about 15 per cent but British buyers began to return inland last year before they did on the coast," says Paul. He adds that most of his clients have budgets of around £700,000 to £1.3 million, enough to afford a three-bedroom villa in Valbonne, in the south of France, or for about £1 million, a small villa outside St Tropez.
Roddy Aris from Winkworth recommends La Garde Freinet, half an hour in the hills behind St Tropez, but refreshingly removed from the super-yacht and Ferrari set. "For £1 million to £2 million you can buy a four to six bedroom house with a few acres of land, great views and lots of privacy, which is hard to find near the coast."
The Marsden family from Wells in Somerset – Bob, a commercial property investor, his wife Lynne and their children Jo, 18, Tom, 17 and Matt, 14 – intend to spend every school holiday in their 300-year-old house in La Garde Freinet, which they bought for £544,000.
Set in a forest hamlet built by monks, the house has three bedrooms, a pool and a wisteria-covered terrace.
"Prices here are about a third of what you would pay in St Tropez and we're away from the coastal traffic, which is horrendous in summer," says Bob, who has been spending holidays in the area for 20 years. "We hesitated about buying, then decided to take the plunge and this was the first property we saw. It was perfect so we bought it immediately," he says.
"It's an investment in terms of lifestyle rather than money as we spend all of our holidays here. It's slightly cooler here than on the coast in summer and much less touristy."
5 French Alps
Britons have returned to the slopes with cash to spend, not just on absurdly-priced cocktails but ski chalets. The Trois Vallées, which includes the ski resorts of Meribel and Courchevel, remain the most popular, but improved infrastructure across the valleys means you can find better value in less glitzy spots and still be within easy reach of prime ski territory.
"In Courchevel 1850, France's first purpose-built ski resort, a new four-bedroom chalet will cost £6 million, but there are lots of former farming villages with different personalities along the valley such as Le Freney, where a four-bedroom chalet on a new eco development costs £650,000," says Matthew Hodder-Williams from Knight Frank.
The Chamonix valley is another eternally-popular spot. "Buyers aren't interested in trailblazing, they want something of real substance," adds Matthew, who says Argentière village is seeing high demand, with plenty of bars and shops and a mix of old village farmhouses and new chalets. A five-bedroom chalet within five minutes walk of Argentière costs £1.5 million through Knight Frank.
By Zoe Dare Hall from the Telegraph
Latest figures indicate hope for battered Spanish real estate market
Friday, 12 February 2010
The price of re-sale property in Spain increased in January for the first time in 24 months, according to new figures and other reports suggest there are tentative signs that part of the country’s battered real estate market is coming back to life.Prices rose by 0.6% on average, with the regions of Cataluña, and La Rioja seeing the greatest recovery in price at 4.6% and 4.5%, according to figures from the real estate portal fotocasa.es.
Property prices also rose in the regions of Comunidad Valenciana, up 2,2%, Asturias up2%, Baleares with a 1,9% increase, Aragón up 1,4%, Galicia up 0,9% and Madrid up 0,7%. While another index shows that overall Spanish property prices fell by 5.5% over the 12 months to the end of January. But these figures from appraisal company Tinsa often need to be taken with a pinch of salt as they are based on their valuations, not on actual selling prices. But the latest Tinsa index is an improvement on the 6.6% decline last month and confirms a general trend towards smaller price declines.
However activity in the real estate market is still very depressed.
The latest figures from the National Institute of Statistics shows that year on year the market shrank by 27% in volume terms to 372,000 transactions in 2009. They have fallen 48% since 2007 when there were 715,000 sales. December 2009 had just 28,669 home sales, the second lowest level of monthly sales on record. But compared to December last year, sales were down just 1%. ‘That’s because by December last year, the market was already deep in crisis. From now on, annualised comparisons won’t look so bad, and won’t give any indication how far the market has fallen,’ explained Marc Stucklin of Spanish Property Insight. ‘When the market hit the skids, resale transactions collapsed much quicker than new builds, which outnumbered re-sales throughout 2009. In normal market conditions, it’s the other way around.
As 2009 went by the two started to converge, and in 2010 re-sales may once again overtake new builds, though it does depends on whether banks are prepared to lend to resale buyers,’ he added. Whilst there’s little doubt that life is returning to the Spanish property market, it still remains utterly price sensitive, according to Chris Mercer, director of Mercers real estate agents with offices in Costa Cálida and in Jerez. ‘We are making it our business to find realistically priced property from motivated sellers for serious buyers who are in a genuine position to make a purchase. The reality is that decent investment properties are out there, whatever the market, it just takes some expertise and effort to find them,’ explained Mercer. ‘If your property is overpriced you won’t sell and you’re wasting your own time and our time, whilst also giving the buyer an unrealistic view of the market. If you’re a motivated seller able to accept a realistic price for your home, we’ll find a buyer,’ he added. He also believes that for investors renting to local people can prove fruitful. These include apartments in Jerez at €70,000 that can rent for €450 a month, a return of around 8%.
‘If you’ve got a 20% deposit then the rent will comfortably pay the mortgage and as you’re truly buying at the bottom of the market, you have an asset that will certainly appreciate in years to come,’ he said.
Source: www.propertywire.com
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