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Real Estate Briefing 17.Aug 2011

Posted on 17 August 2011 by Laxman |  Email |Print

Some of the nation’s largest pension funds are starting to back away from trophy properties in the most expensive real-estate markets over concerns a new bubble is inflating.
After property prices crashed during the financial crisis, pension funds—among the biggest investors in commercial real estate—turned their investment strategies away from risky speculative projects and toward properties considered “core,” well-leased buildings that are seen as low risk due to their stable income, in cities such as New York, Washington and San Francisco……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

Patrick NewportBuilders began work on fewer homes in July, indicating residential real estate is failing to contribute to U.S. growth two years into an economic recovery.
Housing starts fell 1.5 percent to a 604,000 annual rate, in line with the median forecast of economists surveyed by Bloomberg News, from June’s 613,000 pace that was less than previously estimated, Commerce Department figures showed today in Washington. Building permits, a proxy for future construction, also dropped……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

A bill before the U.S. Congress could stabilize the U.S. housing market by reducing the number of foreclosures for sale. Originally introduced in 2009 (but never voted on in the Senate), The Neighborhood Preservation Act would allow banks, as well as Fannie Mae and Freddie Mac agencies, to rent out repossessed (REO) properties to previous owners or other persons for 5-year terms.
The occupant will also have the option to purchase the rental at the end of the term. And it is hoped the bank will be able by then to sell at a higher price to recover more of their losses……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

Since Standard & Poor’s downgraded the United States’ credit rating, the financial markets have ping ponged hundreds of points per day, dropping to 2008 levels only to inch back up. The July jobs report highlights a national unemployment rate still stubbornly fixed above 9%.
Housing continues to flounder and millions of homeowners watch their home equity shrink further each month. None of this is reassuring news for Americans……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

Builders starting on new apartments are busier than ever these days as demand for rentals climbs and the once-sacrosanct American dream of home ownership fades.
The Commerce Department said on Tuesday housing starts slipped 1.5 percent in July to a seasonally adjusted annual rate of 604,000 units. But starts on multifamily housing, often used for rentals, rose 7.8 percent to 179,000 units……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

Home prices have taken such a beating and demand for rental units has increased so much that it’s now cheaper to buy a two-bedroom home than to rent one in most major U.S. cities.
According to real estate web site Trulia, buying was cheaper than renting in 74% of the country’s 50 largest cities in July. In just 12% of the cities, including New York, Seattle and San Francisco, renting was cheaper. In the remaining 14% of cities, renting was less expensive but close to the cost of buying……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

Home prices in some of the nation’s hardest-hit metro areas have fallen far below pre-bubble levels, stirring concerns that properties in those markets are undervalued.
In a recent analysis, real-estate firm Zillow Inc. studied the correlation between home prices and annual incomes over the 15-year period that ended in 2000, before home prices began to surge……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

In early spring, when the news came out that housing had entered a double dip - prices were falling again - it seemed like an outlier. The jobs market was picking up steam. Corporate profits were up.
The stock market was rising. A lot has changed in just a few months. Now the question is whether housing was a leading indicator for the economy, or was it just leading the economy……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

Chaos in stock market indexes from around the globe, has meant a corresponding rise in bond prices, which has pushed yields to record lows. Will it lift the beleaguered housing market?
The average rate on 30-year fixed mortgages is down to 4.32%, according to Freddie Mac’s latest survey. At these levels, mortgage rates have gone back to 50-year lows set during the fourth quarter of last year. Mortgage rates are closely linked to yield on 10-year U.S. Treasuries, which have hovered down in the 2.15% trading range……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

Bank of America Corp. (BAC), the largest U.S. bank by assets, is in talks to sell real estate investments held by its Merrill Lynch unit to Blackstone Group LP (BX) for as much as $1 billion, said a person with knowledge of the matter.
The assets include properties in Europe, the U.S. and South America, said the person, who asked not to be identified because the negotiations are private. Bank of America in July 2010 hired Blackstone to manage Merrill’s Asian real estate investments while retaining ownership in what was a $2 billion private- equity fund……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

Stable interest rates and rising prices in Vancouver have proved to be positive factors for Canada’s housing industry, according to the Canadian Real Estate Association, which had forecast declining sales but now expects them to increase in 2011.
This is despite the fact that both sales and sale prices dropped in July from the previous month — sales edged down by 0.1 per cent, and the national average price of a home during the month was $361,181 — the lowest it’s been since January, CREA said………………………………………Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

Sales of existing homes in Canada rose in July from a year ago, but average house prices are now at their lowest level since January as sales of luxury homes in Vancouver slow from their frenzied pace earlier this spring.
Toronto’s housing market, the largest in the country, has also cooled slightly, the Canadian Real Estate Association said Tuesday……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

Average office vacancy rates in CEE declined below 14% in H1 2011 following on from a 2% decline since the fourth quarter last year, according to the latest data from CB Richard Ellis (CBRE).
The further decline in vacancy was a result of limited new office supply and increasing demand. The majority of this decrease was the result of positive vacancy trends in Eastern European capitals, as net absorption was particularly strong there……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

House prices rose in many areas of the UK in June compared with the previous month, but year-on-year values have fallen, government figures show.
On average, prices increased by 0.6% in June compared with the previous month, the Department for Communities and Local Government (DCLG) said……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

The UK shopping centre investment market is set for an extremely busy finish in 2011, according to Savills.
The international real estate adviser reports that there were just 10 shopping centres deals accounting for £501 mln (EUR 571 mln) in the second quarter of 2011. But there are currently 25 shopping centres under offer with a further 17 in the market……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

Flat prices fell by 6 percent in Sweden and house prices by 2 percent in July compared to the previous month, according to fresh figures from Sweden’s real estate statistics website Mäklarstatistik.
Despite this marking the fourth month in a row that flat prices have fallen in Sweden, Claudia Wörman of the Association of Swedish Real Estate Agents (Mäklarsamfundet) says that it’s too early to be concerned……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

As international investors gradually return to the Danish property market, real-estate companies from Sweden have been among the first to take advantage of opportunities in their neighboring country.
So far, Swedish companies have mostly taken small steps into the Danish market, as exemplified by Gothenburg-based Castellum AB’s latest acquisition in Denmark. In early July, the company bought a fully leased office and warehouse property in the Brondby area of Copenhagen for 24 million Swedish kronor ($3.7 million)……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

The negative effects of the crisis on the retail property market are more prominent in Hungary than in Western Europe, Világgazdaság writes.
Signs of recovery appeared in the second half of 2010, but the volume of investments expected this year and the next two years indicate an upturn is far away……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

Construction costs in Switzerland are more than 25% higher than anywhere else in the world, according to the annual ‘International Construction Cost Comparison Report’ released yesterday (August 16, 2011) by built asset consultancy EC Harris.
The annual report, which benchmarks the construction costs in 55 countries across the globe using UK prices as a baseline, found that Europe continues to be the most expensive continent in which to build, providing eight of the top 10 entrants in the final league table……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

H1 11 take-up in Warsaw totaled 320,000 m² and was 46% higher when compared to H110, according to Savills, with non-CBD take-up exceeding 207,000 m².
The international real estate advisor states that average vacancy rates in Warsaw have dipped to 6.2% from 8% over the past 12 months but the most visible decline is seen in non-central locations where vacancy rates are lower than CBD at 5.2%. Within these markets, 42% of contracts signed were new leases compared to 30% in the CBD……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

The property market has gained strength according to estate agents Romans following a successful auction in Binfield. The company’s latest property auction at Blue Mountain Golf Club on Wednesday, July 27, raised almost £3 million for its customers from 85 per cent of the lots sold.
Simon Clayton, director of Romans auctions, said: “Recent media coverage is completely at odds with what we’re actually experiencing in the auction room……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

A Canadian journalist’s daring on-the-scene account of Somali pirates’ operations challenges several presumptions, including conjecture that booty from the marauders’ hostage-takings is being used to fuel a property boom in Nairobi.
Irrespective of whether pirates are hiding out in Eastleigh, writes Jay Bahadur, author of The Pirates of Somalia: Inside Their Hidden World, a rough calculation is sufficient to dismiss the notion that piracy has had anything to do with the skyrocketing demand for Nairobi land……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

A key trend that has followed the epochal socio-political changes in the Middle East and North Africa region is the increasing prominence of Dubai as a preferred foreign direct investment destination.
Led, particularly, by financial institutions – several of them looking at promising alternative destinations for relocating their corporate headquarters – and corporate entities eyeing an entry to the wider Middle East, North Africa and South Asia (MENASA) region, Dubai is underlining its hub status in the region……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

With stock markets in a state of dislocation, by contrast real estate markets in Asia Pacific are continuing to function well with a succession of deals being completed by a range of investors, according to property consultants.
In the last few days brokers at Jones Lang LaSalle have acted for investors to complete three sizeable deals and have several more in the pipeline which are expected to complete in this quarter……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

China’s ongoing efforts to tame the nation’s residential property market are prompting more and more local developers to consider cutting prices to reduce inventories and boost cash flows.
With inventories rising and market uncertainty growing, a large proportion of developers is expected to take measures to boost sluggish sales, with most saying they will make more units available to the market in the second half of this year……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

Country Garden Holdings Co. said Tuesday its first-half net profit rose 63% from a year earlier because of strong property sales, adding the Chinese developer will continue to expand its footprint in China.
Country Garden joins a string of Chinese property companies—includingg China Vanke Co., China Overseas Land & Investment Ltd. and Longfor Properties Co.—to post strong first-half results, even as Beijing launched measures aimed at cooling the residential property market……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

At a time when investors like James Chanos, CEO of New York City-based Kynikos Associates, is short China and China real estate because of his belief that, “China has been relying on a property bubble to spur its GDP growth,” savvy real estate investors are pouring money into China’s property market. Why the disconnect?
There are two reasons: 1) China’s curbs on real estate lending are leaving local developers short of cash, creating unprecedented opportunities for foreign investors to participate in China’s real estate development;……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

Singapore’s private home sales gained some of the ground lost in June as last month’s sales rose 17 per cent from the previous 25 per cent drop, as superstitious buyers dove in ahead of the traditionally slow Hungry Ghost Month.
Developers sold 1,386 private units last month, up from 1,182 in June, according to data from the Urban Redevelopment Authority (URA)……………………………………….Full Article: Source

Posted on 17 August 2011 by Laxman |  Email |Print

Commercial real estate could be losing its cachet as a safe-haven investment due to concerns about the economy and reduced access to bank financing for landlords.
For most of the past year, investors snapped up the stocks of real-estate investment trusts, thought to be immune from the turmoil in Europe’s debt crisis and unrest in the Middle East……………………………………….Full Article: Source

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