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Real Estate Briefing 06.Oct 2008

Posted on 06 October 2008 by Laxman |  Email |Print

From Guardian: House prices are going to rise again. That may seem a scenario far removed from today’s headlines about falling prices and haemorrhaging values. But, according to an influential economics consultancy, prices have to go up for one simple reason - government targets for the minimum number of new homes are just not being met.

A year ago, ‘targets’ were the order of the day. Gordon Brown announced that in England alone there should be between 240,000 and 297,700 homes built annually until 2016, and that, in total, between 2.9 million and 3.5 million new homes should be built by 2020. In 2007 - before the downturn hit the new-build market - some 174,900 homes were completed: still below target but on an upward path from previous years….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Theglobeandmail.com: Equity-rich Canadian pension funds are leading a stampede of international investors looking to cash in on steep commercial property price declines across Europe, a report on Friday showed.

Global property consultant DTZ said Canadian pension funds and property companies such as Cadillac Fairview and Brookfield Properties, were planning to increase their exposure to real estate by around $50-billion (U.S.), with much of this planned new investment destined for Europe.The two largest pension plans in Canada each boast assets in excess of $100-billion….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Independent.co.uk: It is a dream of thousands of Brits – to buy a second home in a picturesque spot in France and wile away hot summers converting a dilapidated barn into the perfect home in the sun.

But there are signs that many are abandoning their plans to buy a plot over the Channel as the economic downturn hits the second home market. And the situation has become so bad that some second home-owners wanting to sell up in France have had their properties on the market for as long as three years, according to agents….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Propertywire.com: Spain is still the most popular place abroad for British property investors but emerging markets are closing the gap, according to a new report. France is a close second to Spain and between them the two countries account for one in three purchases (29) although interest in these markets has declined slightly since last year, the report compiled by Conti Financial Services found.

Dubai and Cape Verde are both showing signs of becoming more popular. Dubai has moved from ninth to seventh place in popularity and although Cape Verde does not make the top ten this year it is quickly establishing itself as a contender accounting for 3% of enquiries in the last two months alone….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Shanghaidaily.com: Pre-construction sales of residential units in Beijing dipped 76 percent in September from the same month last year, according to an industry Website. And in Shanghai, about 290,000 square meters of housing were sold in the first 20 days of September, only 20 percent of that in the same period of last year.

In the capital, a total of 2,788 pre-construction units were sold last month, according to the Beijing Real Estate Trade Management Website under the Beijing Municipal Construction Committee….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Propertyeu.info: German open-ended funds (GOEFs) have the firepower to invest as much as EUR 25 bn in the global commercial real estate market over the next two years, according to a new report by CB Richard Ellis. The international broker based the claim on the funds’ high liquidity and projected cash inflows of EUR 7-8 bn in 2008.

‘The GOEFs’ unique characteristics as equity-rich, risk-averse investors give the sector heightened strength in today’s credit-scarce business climate,’ CBRE said in a statement….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Ired.com: The financial crisis, already deep in America and taking shape in Europe, is reaching as far east as Russia, where residential and commercial developers are already cutting activity and looking for better placements. For Russia the game is even more symbolic.

After almost two decades of turbulent post-communist development, the real estate investment has remained a relative island of stability. Is it over? Now the Russian experts aren’t discussing the possible trends, but just the amplitude of the coming market correction. This time they are talking about a real correction, after two mini-corrections in 1998 and 2004, which were provoked mainly not by the market, but by state mismanagement….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Seekingalpha.com: The great thing about investing is that if you do your homework, you can always find a way to profit in any market. Even when the stock market as a whole is doing poorly, there are always sectors and individual stocks that are doing well, if you are looking for a profitable trade.

Sometimes you have to buy gold or oil stocks, sometimes you have to buy an ETF that is short the DOW, S&P, Nasdaq, or some other index. But the point is there is always something going up. In real estate, the same thing is true. It’s a cyclical industry and there are times when certain types of properties do better than others. I can remember times when condos were scorching, other times when it was commercial properties, or even land in certain locations that was hot….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Bi-me.com: Saudi Arabia Prince Meshal Bin AbdulAziz Al Saud, Chairman of Saudi Arabia’s Bayah Council, and owner of Al-Shoala Group of Establishment announced a SAR 27 billion (US$7.2 billion) joint venture project with Emaar Properties to develop a 31 million square metre master-planned community, Rawabi Rumah, located near Riyadh.

Prince Meshal signed the joint venture with HE Mohamed Ali Alabbar, Chairman, Emaar Properties, in Jeddah, recently. Emaar, a global property developer, will share its core competencies in integrated mega-project development by creating a vibrant community featuring luxury homes and commercial space, retail outlets, healthcare centres, educational institutions and community centres….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Therealdeal.com: Price cut and contract break statistics for the third quarter of this year reflect economic upheaval. According to Streeteasy’s third-quarter Manhattan market report, price cuts increased significantly last quarter. There were 2,900 cooperative and condominium unit listings in the third quarter with price cuts from the original prices, averaging 6.6 percent.

Price cuts in condos increased 152.5 percent over this time last year and 2.1 percent over last quarter, the real estate data site found. The largest price cuts were at 1120 Fifth Avenue, where a unit originally on the market for $20.4 million was listed for $12.9 million in the third quarter, a decrease of 36.8 percent; and at 18 West 48th Street, where a unit first listed at $1.2 million was then on the market for $790,000. …. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Propertyeu.info: ‘European office markets are experiencing their leanest period for five years,’ according to King Sturge. Based on research in its latest office market report to be launched at Expo Real in Munich the property adviser found that ‘initially, property investment bore the brunt of the crisis but our research shows evidence of weaker take-up and increasing supply, although prime rental growth is slowing rather than falling’.

The report added that the turnaround over the last 12 months had been unexpectedly abrupt. This was due to the concentration of office demand in finance and business services, which made them more vulnerable to the impact of the crisis….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Citywire.co.uk: Moves by housebuilders to down tools and mothball projects will demolish the government’s new homes target and could trigger another boom-bust cycle, the Royal Institution of Chartered Surveyors has warned.

The government needs 200,000 homes built a year to hit its target of two million homes by 2016, but the total so far this year is only 66,200, said Rics. Failure to hit this target could see surging house prices if demand outstrips supply, said Rics senior economist Oliver Gilmartin….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Albawaba.com: Abu Dhabi Central Business DistrictAbu Dhabi, the richest city in the world, has seen its gross domestic product (GDP) soar from US$40.6 billion in 2002 to US$108.9 billion in 2007 (more than 8 per cent per annum).

The booming real estate and tourism sectors are playing a significant part in this success story as the total value of announced projects in the capital inches towards the US$ 500 billion mark (AED 1.83 trillion). It is at this crucial time that MEED, the business intelligence expert in the Middle East, and the Abu Dhabi Department of Planning & Economy have announced details of its Abu Dhabi 2008 conference….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Telegraph: It seems so long ago. When HSBC took a £5.4bn hit early last year on a portfolio of home loans practically thrust into the hands of low-income Americans, the property market appeared to stand almost in isolation at the heart of a growing storm.

Recently, with banks across the globe contributing to the spectacular implosion of their own sector by all but ceasing to lend to counterparts, the trials in property have almost become a side show. But the difficulties continue, not least among the small-cap and Aim-listed companies so often overlooked among the titans….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Propertywire.com: Public and private developments in the Middle East should adopt the latest green building codes as a matter of course, not least because they can save costs, it is claimed.

Compliance with eco-friendly directives can increase the performance of structures by more than 30% and improves the physical environment, occupant productivity and life cycle costs of the building, points out one developer. AAKAR Marjan Island LLC, a luxury community developer in the Middle East, said it wants to transform the way conventional methods in the real estate industry and it is urging others to do the same….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Lutontoday.co.uk: Average house prices in Luton and South Beds were £197,232 in the three months ending in September, according to the Nationwide. According to the company’s research the average price of property in the area was was seven per cent lower than in 2007, compared with an average UK drop of 10.3 per cent.

In the previous quarter, ending in June 2008, prices had actually risen by one per cent over the year. Property in Luton and South Beds is still valued at 157 per cent more than it was 10 years ago, making it the best performing part of the Nationwide’s outer metropolitan area….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Propertywire.com: The takeover of HBOS by Lloyds TSB could lead to distressed properties coming onto the property market in Scotland and hit builders who are funded by the bank.

According to one property analyst HBOS has given both debt and equity support to commercial property firms and clients and was generally reluctant to take action against borrowers who breached their banking covenants with lenders. But David Davidson, a partner at Cushman & Wakefield, warns that the new owners may not be so amenable. ‘HBOS has equity stakes in high-profile companies, such as Miller and Cala. There are almost no property companies without exposure to the bank. …. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Times Online: Llandlords coming to the end of cheap two-year fixes face payment shocks of almost £300 a month on a typical £150,000 mortgage, as house prices fall and lenders pull their competitive deals.

The number of buy-to-let mortgages shrunk by almost a third in a single day last week following the withdrawal of Bradford & Bingley, formerly the UK’s biggest lender to landlords, from the market. UCB Home Loans and The Mortgage Works, both owned by Nationwide, followed suit. Nationwide said it was a temporary measure as they were inundated after B&B’s demise. It expects to resume business for new customers within days….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From WSJ: The government here blessed the proposed merger of two big home lenders and said a government-backed fund would start investing in domestic real estate, moves that could shore up a suddenly vulnerable property market.

Amid super-high oil prices, the petroleum-rich states of the Persian Gulf have enjoyed a spending and investment binge in recent years. With little oil of its own, Dubai has positioned itself as a tourism, business and financial hub, spearheading a host of high-profile real-estate developments….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Livemint.com: With real estate prices now beginning to get real and developers wooing buyers with sops and freebies, experts assess whether it is the right time to buy your home. This is one question for which there are no easy answers. With prices high, interest rates steep and the sector slowing overall, buyers are not easy to come by.

But the question that inevitably follows is if prices are likely to fall or if it is time for the much talked about correction in the real estate sector. Experts say that with real estate prices now beginning to get real, this is the right time to buy your dream home. …. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Irishtimes.com: The German government and the country’s banks and insurers agreed on a €50 billion rescue package for commercial property lender Hypo Real EstateHolding AG after an earlier bailout faltered.

The financial industry agreed to double a credit line for Hypo Real Estate to €30 billion, Torsten Albig, a spokesman for Finance MinisterPeer Steinbrueck, said last night.The government and the Bundesbank have said that Hypo Real Estate, Germanys second-biggest property lender, is too big to fail….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Dailymirror.lk: Sri Lankan construction companies have been able to expand their activities into the international market and in Qatar alone; they have been able to secure contracts worth US$ 200 million.

And this was at a time when the international economy was in the doldrums, Minister of Export Development and International Trade, Prof G.L. Peiris said at the annual sessions of the Sri Lanka Chamber of Construction Industry held recently at Hotel Galadari. Prof. Peiris said the international economy is always subject to various instabilities and that at the present time too, it has been undergoing a tremendous crisis….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Theaustralian.news.com.au: Property investors and home owners hoping for a revival in the housing market will have to wait another year, according to experts, as property clearance rates around the country took another hammering over the weekend.

Australian Property Monitors senior economist Liam O’Hara said that confidence would not be restored in the property market until interest rates had been “reduced dramatically”. “When the (financial) system breaks down, investments like property and shares are in doubt as a general flight to liquidity develops,” he said….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Todayszaman.com: The number of foreigners purchasing property in Turkey has boomed in recent years thanks to attractive pricing in the housing market, especially in southern parts of the country, which have an excellent climate.

A report issued by the Land Registry Office indicates that Germans top the list of foreigners who own real estate in Turkey, followed by the British, Irish, Greeks, Danes, Norwegians, Austrians and Belgians. Reports on global warming issued by the UN occasionally have an effect on people’s desire to live and own real estate in the southern coastal regions of Turkey….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Xinhuanet.com: The Dubai-based real estate developer Nakheel announced Sunday that it plans to build a one-kilometer-high tower in the commercial and financial hub of the United Arab Emirates (UAE), Emirates News Agency reported.

The tower is part of Nakheel’s new community project named “Harbor & Tower” which will include the world’s first inner city harbor, according to the report. The tower will have four individual towers within a single structure. A distinctive crescent-shaped podium will encircle its base….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Financialadvice.co.uk: While we have touched on this subject in some of our earlier post it is still a subject which confuses and annoys some people. Why do we really depend upon the property market so much? Why is it such an integral part of our lives?

There are many reasons why we depend on the property market which include:- Some where to live! While this may seem the most obvious reason why we have an interest in property it is one of the main ones. Even though there is substantial council housing and rented accommodation around the UK there is nowhere near enough to cover everyone’s needs….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Scotland.gov.uk: Empty churches and underused church land could help address Scotland’s affordable housing shortage. Communities Minister Stewart Maxwell praised 13 Scottish church bodies which have joined forces with the Scottish Government to promote greater use of surplus church properties and sites for affordable housing.

The Church Property & Housing Programme aims to help supplement the mainstream affordable housing programme, and contribute to sustaining rural communities. It encourages and supports churches in making surplus property available for much needed-affordable housing….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Gulf-times.com: The Middle East’s real estate market yesterday received a downbeat assessment from consultants Colliers International amid rising concern that the global credit crunch will hit one of the world’s last property hot spots.

“Against the backdrop of the global credit crisis regional investor sentiment is leaning towards a more cautious approach to the market”, the company said in its fourth-quarter real estate report for the region. The report adds to fears that confidence is fading in the region’s property amid rising concerns about a global economic downturn. Morgan Stanley warned in August that property hotspot Dubai could see a 10% fall in prices by 2010….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Business-standard.com: This festive season may be a good time to buy your dream home, for property developers are showering discounts. Most realtors are already advertising cash discounts of 5-10 per cent on upfront payment and buyers can get up to 25 per cent discount if they book properties and are willing to wait for two to three years until possession.

According to consultants, developers may even give 15-20 per cent discount on the price as they are eager to clear inventories. Normally, the October-December period accounts for 60 per cent of the sales. What is worrying developers is the sharp decline in property sales this year. From the beginning of the year, home sales have halved because of high interest rates and a sharp rise in the monthly loan payouts of borrowers….. Full Article: Source

Posted on 06 October 2008 by Laxman |  Email |Print

From Chosun.com: The feeling in the construction industry is that the economy is worse than during the Asian crisis 10 years ago. Several indicators are reminiscent of the economic crisis, chiefly plummeting property prices and soaring interest rates.

According to the annual housing pricing index by the Kookmin Bank, property prices, which had been rising until early 1997, plunged in 1998. The index for the price of apartments, at 55.8 in 1997, dropped to 48.2 the next year. The figure by itself suggests a 14 percent drop, but in fact the price of apartments in the Seoul metropolitan area plummeted by over 20 percent in less than a year…… Full Article: Source

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