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Real Estate Briefing - Archive | July, 2009

Australia: $3bln property trust rout forecast as values slide

Posted on 30 July 2009 by Laxman  |  Email |Print

From Theaustralian.news.com.au: As much as $10 billion has been wiped from the value of unlisted wholesale property trust assets in the year to June.

Analysts predict about $3bn worth of real estate holdings will need to be sold by these funds in the coming months………Full Article: Source

Real estate investors go begging

Posted on 30 July 2009 by Laxman  |  Email |Print

From Reuters: Investors in real estate funds can’t give their stakes away. In another sign of more bad news to come for commercial real estate, NYPPEX Private Markets reports a sharp drop in prices for limited partnership stakes in real estate funds in the unregulated secondary market.
NYPPEX says the average bid for these partnership shares plunged 61% over the past month to a price that represents roughly 22 cents on the dollar………Full Article: Source

Is it possible to short sell real estate?

Posted on 30 July 2009 by Laxman  |  Email |Print

From Investopedia.com: The traditional idea of a short sale is selling something you don’t have so that you can buy it back at a lower price. The easiest example is stocks. Short sale of a stock involves borrowing stocks from a broker in order to sell them, and when prices fall, buying back the stocks to return to the broker and keeping any profit made.
One option that is similar to shorting of a stock is to invest in ETFs that are short in real estate. These ETFs are typically designed to give inverse returns to a pool of real estate investments, usually REITs. ……..Full Article: Source

Is real estate on the road to recovery?

Posted on 30 July 2009 by Laxman  |  Email |Print

From ETFguide.com: U.S. home prices may be stabilizing according to latest figures reported by the Standard & Poor’s Case Shiller index. But before you uncork the champagne, it’s still too early to conclude “the worst is over.”

Home prices from the period of April to May rose or remained unchanged in 15 out of 20 cities. The Case Shiller index tracks the performance of home prices in 20 U.S. metropolitan areas………Full Article: Source

Emerging markets lead global property recovery

Posted on 30 July 2009 by Laxman  |  Email |Print

From Investmentweek.co.uk: Global commercial property markets are showing signs of a recovery as emerging markets lead strong rises for the S&P Property and REIT indices in Q2.

The latest Quarterly Global Property & REIT report from Standard & Poor’s Index Services found property markets rebounded sharply in Q2. It reports the S&P Global Property Index soared nearly 38% during the period after falling almost 20% in Q1………Full Article: Source

U.S. housing recovery seen possible now: Shiller

Posted on 29 July 2009 by Laxman  |  Email |Print

From Reuters: The U.S. housing market may finally have turned around after three years, given the rise in the widely-watched Case-Shiller home price index for May, the developers of the index told Reuters on Tuesday.

The Case-Shiller home price index for May posted an increase of 0.5 percent, the first monthly rise since 2006, in instead of a forecast 0.5 percent decline, though prices have tumbled more than 32 percent from their peak in the second quarter of 2006………Full Article: Source

Commercial real estate new Achilles heel for banks: Yellen

Posted on 29 July 2009 by Laxman  |  Email |Print

From Market Watch: Commercial real estate is the new Achilles heel for the U.S. banking sector, said Janet Yellen, the president of the San Francisco Federal Reserve Bank on Tuesday.

“The next area of significant vulnerability for the banking system, particularly for community and regional banks with real estate concentrations, is income-producing office, warehouse and retail commercial property,” Yellen told a bankers conference in Idaho………Full Article: Source

Investors finding no fire sales in commercial property

Posted on 29 July 2009 by Laxman  |  Email |Print

From Dow Jones: Investors looking for blue-light specials on distressed commercial property are finding the pickings surprisingly slim as banks refrain from holding fire sales on troubled assets.

Despite rising loan delinquencies and foreclosures on hotels and on retail, apartment and office buildings, banks are reluctant to unload troubled assets at bargain-basement prices amid a lack of transparency and agreement on fair valuations………Full Article: Source

Investment in US property sees upturn

Posted on 29 July 2009 by Laxman  |  Email |Print

From Assetz.co.uk: For those concerned with the question of when the world recession will run out of steam and growth might re-emerge, the recent finding that Britain’s economy shrank by more than expected in the second quarter came as a major blow.
But while confidence in the UK has taken a hit, it seems there are better prospects across the Atlantic………Full Article: Source

Canada: Housing market growth boosts real estate loans

Posted on 29 July 2009 by Laxman  |  Email |Print

From Thestar.com: Canadians, buoyed by a budding housing market recovery, took on more debt in June as they tapped banks for a variety of loans tied to real estate, says a report released yesterday by TD Economics.

Total bank-issued credit to households grew by 1 per cent in June from May. On a year-over-year basis, household credit increased by 9.9 per cent………Full Article: Source

Brazil’s Polo hedge fund boosts bets on homebuilders

Posted on 29 July 2009 by Laxman  |  Email |Print

From Bloomberg: Marcos Duarte, co-founder of the $1 billion hedge fund Polo Capital Gestao de Fundos Ltda., is buying more Brazilian homebuilder shares even after the stocks more than doubled this year.

Duarte said the Rio de Janeiro-based firm is buying real estate developers Klabin Segall SA and EZ Tec Empreendimentos e Participacoes SA, adding to bets on the industry that helped his 659 million-real ($348 million) Polo Norte Multimercado LP fund outperform 96 percent of its peers in 2009………Full Article: Source

UK: House prices increase for first time since January 2008

Posted on 29 July 2009 by Laxman  |  Email |Print

From Independent: House prices in England and Wales rose in June for the first time in 18 months, official figures revealed yesterday in further evidence that the housing market may finally be bottoming out.

The Land Registry, which logs the value of all completed housing transactions in England and Wales and thus provides the most accurate data on prices, said the market was up by 0.1 per cent in June compared to May, the first positive month since January 2008………Full Article: Source

UK: House prices rise in June, but outlook remains gloomy

Posted on 29 July 2009 by Laxman  |  Email |Print

From Guardian: Official figures show the first increase in 18 months, but Land Registry warns this is not a return ‘to solid growth’.
House prices in England and Wales rose for the first time in almost a year and a half in June, the Land Registry said today, but it was quick to add that the move reflected a flattening of prices “not a return to solid growth”………Full Article: Source

UK: ‘Wave of write-downs’ predicted for commercial property

Posted on 29 July 2009 by Laxman  |  Email |Print

From Bridgingandcommercial.co.uk: A further decline in values is likely for UK commercial property, an expert has warned. Gertraud Discherl of KPMG Advisory said that recent speculation that real estate prices had bottomed out, after suffering double-digit percentage point devaluations over the past year, might be misguided.

She added that property was currently “on the cusp of a wave” of “significant … write-downs”, which would bring about a further downwards leg for prices………Full Article: Source

UK tax refugees stoke offshore property prices

Posted on 29 July 2009 by Laxman  |  Email |Print

From Investmentinternational.com: A new survey by The Sovereign Group indicates a robust property market in the offshore sector.
Most offshore tax jurisdictions within easy reach of Britain are bucking the European property market slump as wealthy Britons prepare for an exodus from harsh UK tax rises, according to a survey by international offshore tax firm The Sovereign Group………Full Article: Source

Top UK commentator Kaletsky dispels property market fears

Posted on 29 July 2009 by Laxman  |  Email |Print

From Propertyeu.info: Leading UK economic commentator Anatole Kaletsky has dismissed three of the most widely discussed threats to the property market, saying they are ‘pretty far fetched’ and often presented as ‘indisputable facts’.

The three threats he refers to are fears of a sharp increase in short-term interest rates, the risk of an inflationary upsurge fuelled by the vast amounts of new money being ‘printed’ by central banks, and the perception that governments, especially in the US and UK, have borrowed so much money that some kind of national bankruptcy lies ahead………Full Article: Source

German open-ended funds see EUR 3.1 bln inflows in H1

Posted on 29 July 2009 by Laxman  |  Email |Print

From Propertyeu.info: German open-ended property funds recorded EUR 3.1 bn in net inflows over the first six months of 2009, bringing total fund volume to EUR 87.5 bn at end-June compared with EUR 87.2 bn in the year-earlier period, fund industry body BVI reported on Tuesday.

In terms of total volume, open-ended property funds were the third biggest investment category in the first half after equity funds (EUR 155.7 bn) and interest rate funds (EUR 144.1 bn)………Full Article: Source

French property mortgage market report

Posted on 29 July 2009 by Laxman  |  Email |Print

From Homesoverseas.co.uk: Athena Mortgages has launched a monthly French Property and Mortgage Watch, which should provide a useful overview of the French property market and an invaluable pool of information for potential investors looking to invest in property in France.

July’s report includes French property price trends, gross yields information, and some of the most popular areas to invest in property………Full Article: Source

Property in Portugal not necessarily so popular

Posted on 29 July 2009 by Laxman  |  Email |Print

From Shelteroffshore.com: A recent article in the Guardian about the appeal of property in Portugal spawned a host of spin off articles on property related websites that grabbed hold of anything positive about the nation’s market from the original piece, and pushed the appeal of the country’s real estate to the max.

However, despite the overall positive findings of the original Guardian article’s author Graham Norwood, we would like to argue that property in Portugal is not necessarily so popular with Britons at the moment – even those seeking to buy into a more stable market in Europe perhaps………Full Article: Source

U.A.E. real estate projects worth $300 bln are canceled

Posted on 29 July 2009 by Laxman  |  Email |Print

From Bloomberg: Real estate projects worth more than $300 billion have been put on hold or canceled in the United Arab Emirates as the financial crisis halted construction of over 400 projects, Proleads Group said.

The U.A.E.’s construction market remains active with more than 750 on-going projects and 450 recently completed, the Dubai-based research group said in an e-mailed statement today………Full Article: Source

Property prices in the Emirates on the rise

Posted on 29 July 2009 by Laxman  |  Email |Print

From Offplanpropertyexchange.com: Those with property investment and property management interests in the UAE may welcome research from HSBC which shows that property prices are rising in the emirates.

The new Property Ladder study shows that there has been a marked growth in the UAE property sector, in part spurred by a relaxation of maximum loan-to-value (LTV) rates that have allowed more people to get on the housing ladder………Full Article: Source

Moody’s sees Dubai real estate in decline until Q2 next year

Posted on 29 July 2009 by Laxman  |  Email |Print

From Arabianbusiness.com: The decline in Dubai’s residential property market is likely to continue until the second quarter of next year, Moody’s has said.

“Moody’s notes that the Dubai residential property market generally remains oversupplied, and the downward trend in the market is unlikely to stabilise before Q2 2010,” the credit rating agency said in a special comment on Dubai-based developer Emaar………Full Article: Source

Iraq short of 1.5 mln houses: UN

Posted on 29 July 2009 by Laxman  |  Email |Print

From AFP: Iraq has a housing shortfall of 1.5 million homes and the situation will worsen in the coming years as more and more Iraqis migrate to cities, the United Nations said on Monday.

The country also requires an additional 4,000 primary schools, while half of the 15,000-odd schools already in use require major rehabilitation, the UN’s urban development agency said in a report outlining its plans in Iraq over the next three years………Full Article: Source

Property sales in Lebanon fall by 3.3 pct

Posted on 29 July 2009 by Laxman  |  Email |Print

From Zawya.com: The number of property sales transactions in Lebanon went down by a 10.6 percent year-on-year in June 2009, which more than offset the growth in demand witnessed in the first quarter of the year and in May, leading to a yearly decline of 3.3 percent in property sales transactions in the first half of the year to reach 33,830.

Figures released by the Directorate of Real Estate and published by Bank Audi Weekly Monitor indicate that the total value of property sales in Lebanon in the first half of 2009 was at LL3.703.3 trillion, down by 5.2 percent from the value of property sales registered in the first half of 2008………Full Article: Source

Residential property prices in South Africa show year on year rise

Posted on 29 July 2009 by Laxman  |  Email |Print

From Propertywire.com: The residential property market in South Africa appears to be coping with the global downturn although concerns about a rising number of foreclosures are increasing.

The average price of a property in South Africa increased by 1.2% year-on-year in June, according to the latest property price index………Full Article: Source

Namibia: Housing market remains vulnerable

Posted on 29 July 2009 by Laxman  |  Email |Print

From Allafrica.com: Although higher price tags on especially large houses in Windhoek during April drove the value side of the FNB Housing Index up to levels of last January, everything is far from coming up roses in the local property market.
Housing demand is still subdued despite lower interest rates, prices for smaller houses remain under pressure and prospective home buyers are facing tighter lending criteria………Full Article: Source

What fuels rising property prices in China?

Posted on 29 July 2009 by Laxman  |  Email |Print

From Cri.cn: China’s Ministry of Land and Resources recently released data indicating that the average land price accounts for about 23 percent of the surge in house prices, sparking defensive replies from property developers and even more heated discussion across the country about the sizzling property market.

A commentator from Securities Times said the move is an active defense by land authorities against the blame for fueling the rise in property prices. It is commendable of the ministry to respond to people’s inquiry in a timely manner and make information public………Full Article: Source

China: Developers dispute over real estate bubble

Posted on 29 July 2009 by Laxman  |  Email |Print

From People.com.cn: The central government has held meetings to research and investigate problems in the real estate market, and the call to prevent a bubble forming keeps getting louder.
Is there a real need to cool the real estate market down in the second half of the year? Housing prices in some areas are soaring while the real economy is still at rock bottom. Is an overheated real estate market a crisis or an opportunity?……..Full Article: Source

China: Real estate developers, strapped for cash, resort to “irregular” tactics

Posted on 29 July 2009 by Laxman  |  Email |Print

From Chinastakes.com: While the real estate market appears to be is in the midst of a boom, defaults among developers are also beginning to rise. Small and medium developers are resorting to faking sales to get bank loans to relieve their funding pressure.

Statistics show that from May 1 to July 24, which seemed to be good days for Shanghai’s real estate market, many housing projects were seeing over 30% cancellations, and the cancellation rate of some projects was as high as 125%………Full Article: Source

India: Realty to pick up on prices, activity - Jones Lang LaSalle

Posted on 29 July 2009 by Laxman  |  Email |Print

From Reuters: India’s property market could see lower prices and a pick up in business activity lifting demand in the near term, but new supply will keep a lid on rises in property values, a top industry official said on Tuesday.

“In India, demand is holding up relatively better as the economy is still growing. Commercial property is stabilising, but residential has seen a bounceback,” Alastair Hughes, chief executive for Asia Pacific at property services firm Jones Lang LaSalle, told Reuters in an interview………Full Article: Source

Malaysia set to attract foreign property investment in a big way

Posted on 29 July 2009 by Laxman  |  Email |Print

From Asiaone.com: To help offset a drastic drop in private investment, Malaysia plans to aggressively internationalise its real estate and has set a target of attracting RM20 billion (S$8.2 billion) in foreign investment over the next decade.

It has tasked a new public-private entity called Malaysia Property Incorporated (MPI) with improving the level of foreign investment in the sector, which is currently a mere 2.5 per cent of the value of total properties transacted………Full Article: Source

Australia: Google’s real estate foray becomes competitive

Posted on 29 July 2009 by Laxman  |  Email |Print

From Computerworld.com.au: Google’s Australian trial of new real estate aggregation service as part of Google Maps has raised the ire of media heavyweights Fairfax and News Limited.
Users can now search for properties to rent or buy when browsing Australian maps, filtering by price range and property criteria, in a similar manner to the search functions of dominant Australian real estate portals domain.com.au and realestate.com.au………Full Article: Source

REITs roar back

Posted on 29 July 2009 by Laxman  |  Email |Print

From Forbes: Investors have been pouring money back into real estate, but Deutsche Bank sees reasons to worry.
No business was closer to the epicenter–real estate and real estate finance–than publicly traded property companies, known as real estate investment trusts, or REITs………Full Article: Source

US: Almost $165 bln in commercial loans due in ‘09

Posted on 28 July 2009 by Laxman  |  Email |Print

From Bloomberg: Almost $165 billion in U.S. commercial real estate loans will mature this year and need to be sold or refinanced as rents and occupancies fall, according to First American CoreLogic.

The U.S. South has the most maturing loans with 60,893 mortgages valued at $96 billion coming due on shops, offices, hotels, apartment buildings and land, Santa Ana, California- based First American said in a report. The West is second with 20,549 mortgages maturing for a value of $35 billion……….Full Article: Source

Widening commercial real estate crisis hits U.S. banks

Posted on 28 July 2009 by Laxman  |  Email |Print

From WSJ: When commercial real estate markets went bust two decades ago, bankers said they learned a hard lesson. The latest earnings reports from U.S. banks suggest many, in fact, didn’t.

Losses from loans tied to strip malls, office buildings, housing complexes, and the like are hurtling toward record levels not seen since the infamous savings-and-loan crisis……….Full Article (Subscription Required) : Source

New-home sales climb 11%, most in eight years

Posted on 28 July 2009 by Laxman  |  Email |Print

From Bloomberg: Purchases of new homes in the U.S. climbed 11 percent in June, the biggest gain in eight years, underscoring evidence that the deepest housing slump since the Great Depression is starting to stabilize.

Sales increased to a 384,000 annual pace, higher than every forecast in a Bloomberg News survey and the most since November, figures from the Commerce Department showed today in Washington. The number of houses on the market dropped to the lowest level in more than a decade……….Full Article: Source

Sharp rise in US home sales gives hope slump is over

Posted on 28 July 2009 by Laxman  |  Email |Print

From Timesonline.co.uk: Sales of new homes jumped last month as Americans took advantage of bargain-basement prices and low interest rates to enter the housing market, raising hopes that the property slump that has plagued the US since 2005 was ending.

However, developers of luxury Manhattan apartments continued to struggle to offload as wealthy buyers waited for signs of a more substantial economic improvement, new figures from estate agents showed……….Full Article: Source

US pension giants lose big on real estate

Posted on 28 July 2009 by Laxman  |  Email |Print

From IPE: The two largest pension funds in the United States have seen their real estate holdings plummet in value over the last year, as the California State Teachers Retirement System’s property portfolio dropped by 43% in 12 months, while CalPERS lost over a third in a year to the end of March.

CalSTRS’ pension fund real estate assets were valued at $13bn (€9.2bn) at the end of June, having been valued at $20.8bn just 12 months earlier……….Full Article (Subscription Required): Source

Will commercial real estate be bailed out?

Posted on 28 July 2009 by Laxman  |  Email |Print

From Investopedia.com: Many investors are starting to become worried about looming problems within commercial real estate lending, as the credit cycle continues its tortuous path through the American landscape. Is it possible that this will be round two of the bailout of the U.S. financial system?.
This is not a new issue, and many have written on this area previously, but Federal Reserve Chairman Ben Bernanke may have focused renewed interest on with his testimony before Congress earlier this week……….Full Article: Source

US aid may ease commercial real estate credit

Posted on 28 July 2009 by Laxman  |  Email |Print

From Cincinnati.com: Macroeconomic forces such as consumer spending declines and rising unemployment have pushed the commercial real estate market near its bottom. But the inability of developers to secure financing is keeping it there.
Real estate professionals both nationally and locally are pushing for federal aid for the industry. If banks can unload the debt associated with struggling properties, then they are freed to loan to new projects, the experts say……….Full Article: Source

Brazil property mortgage rate cuts

Posted on 28 July 2009 by Laxman  |  Email |Print

From Homesoverseas.co.uk: The central bank in Brazil has cut the country’s benchmark interest rate by 0.5% to a record low of 8.75%, which is good news for anyone looking to buy a property in Brazil.

It is the fifth time in the past five months that the country’s policymakers have agreed to reduce interest rates, which in turn lowers mortgage borrowing rates for existing Brazil property owners as well as for people currently looking to buy a home in Brazil……….Full Article: Source

Direct commercial real estate investment in Europe stabilized in Q2 2009

Posted on 28 July 2009 by Laxman  |  Email |Print

From Europe-re.com: Direct investment in commercial real estate in Europe stood at €24 bln. in the first half of 2009, according to new research from Jones Lang LaSalle. Levels in the second quarter were similar to volumes seen in the first quarter of the year.
The €24 bln. transacted in direct commercial real estate investment in the first half of this year was down 42% on the second half of 2008 (€41.5bln.)……….Full Article: Source

Cross-border investment rebounds in Europe in Q2

Posted on 28 July 2009 by Laxman  |  Email |Print

From Propertyeu.info: Cross-border commercial real estate investment activity rebounded in Europe in the second quarter of 2009, signalling increased appetite from international and pan-European investors, according to Jones Lang LaSalle’s new European Capital Markets Bulletin.
Cross-border investment accounted for 52% of total direct commercial investment volumes, up from a low of 27% in Q1 2009……….Full Article: Source

C&W sees more appetite from institutional investors

Posted on 28 July 2009 by Laxman  |  Email |Print

From Propertyeu.info: Institutional investors will show more appetite for real estate in the second half of 2009, adviser Cushman & Wakefield predicts.
‘Whilst many institutional investors used the first half of the year in particular for the strategic realignment of their portfolios in view of the global economic crisis and, as a result, made negligible investments in indirect real estate assets, there are increasing signs that we are about to enter a renewed phase of investment……….Full Article: Source

U.K. property prices held their value in July, Hometrack says

Posted on 28 July 2009 by Laxman  |  Email |Print

From Bloomberg: U.K. house prices held their value for a third month in July as the credit squeeze and the recession prevented the property market from improving, Hometrack Ltd. said.

The average cost of a home in England and Wales was 155,600 pounds ($256,351), 7.7 percent lower than a year earlier, the London-based property research company said in an e-mailed statement today……….Full Article: Source

UK property market turning green

Posted on 28 July 2009 by Laxman  |  Email |Print

From Business24-7.ae: Much has been made of the declining residential house prices across the world, but not so much has been said about residential development land – an asset which has seen an even more spectacular collapse in its value.

Some estimates suggest that some development lands have fallen by more than 55 per cent on average across the UK – or as much as 60 per cent in some specific areas – since the highs of 2007……….Full Article: Source

Capital values stabilising for UK property, says Aberdeen

Posted on 28 July 2009 by Laxman  |  Email |Print

From Propertyfundsworld.com: While total returns for 2009 will remain firmly in negative territory, the bulk of the anticipated capital value decline occurred in the first half of the year and capital values will stabilise over the next 12 months, according to a report by Aberdeen Property Investors.

The report says yields have already stabilised and are starting to fall again for prime property let on long leases to high quality tenants, and for smaller lot sizes in particular……….Full Article: Source

ING calls the bottom of UK real estate

Posted on 28 July 2009 by Laxman  |  Email |Print

From IPE: The commercial real estate market in the UK has bottomed out in relation to property yields, according to Ian Whittock, chief investment officer at ING Real Estate Investment Management.

Yields for prime UK real estate have hardened in recent weeks and competitive bidding has pushed up pricing in certain areas of the market, although some commentators question whether today’s market values can be can be sustained in the face of a poor rental market outlook……….Full Article (Subscription Required): Source

UK: Investor rental plan looks back to 1950s

Posted on 28 July 2009 by Laxman  |  Email |Print

From Timesonline.co.uk: Britain’s housing landscape is set for one of its most profound changes in more than half a century after pension funds confirmed plans to build blocks of homes for private rental in areas of greatest need.
Much of the building will be in the South East Aviva Investors said that it would plough millions of pounds into purpose-built rented accommodation for those priced out of home ownership……….Full Article: Source

UK’s BMW pension redistributes its real estate

Posted on 28 July 2009 by Laxman  |  Email |Print

From IPE: The UK pension fund of car manufacturer BMW has sold a distribution centre in Europort, Wakefield to UK real estate company Patrick Properties.

The 220,000 square foot property, let to Royal Mail, was sold for £10.6m (€12.2m), reflecting an initial yield of 8.4%……….Full Article (Subscription Required): Source

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