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Real Estate Briefing 15.Mar 2013

Posted on 15 March 2013 by Laxman |  Email |Print

Let’s consider the case of a $250,000 interest only mortgage with a fixed rate of 4 percent that begins to amortize after 10 years. Its monthly payment for 10 years will be $833, after which it jumps to $1515. Suppose a family decides that $833 per month is at the edge of affordable.
This means that in 10 years, its income must have risen by 81 percent, or about 6 percent per year for every year, for the payments to remain affordable. This might happen–it also might not…………………………………Full Article: Source

Posted on 15 March 2013 by Laxman |  Email |Print

More U.S. homeowners were hit with new foreclosure filings in February, pointing to the challenges the market still faces even as the housing recovery gains traction, data from RealtyTrac showed on Thursday. Foreclosure starts were seen on 71,488 homes in February, up 10 percent from the month before, though that was still down nearly 25 percent from a year ago.
Many of the states that saw the biggest increases in new filings either deal with foreclosures through the court system or have recently implemented legislation that has slowed the process down, said Daren Blomquist, vice president at RealtyTrac…………………………………Full Article: Source

Posted on 15 March 2013 by Laxman |  Email |Print

In these metro areas, housing prices are rising, and homes with a ‘for sale’ sign are getting snatched up in no time, according to Realtor.com. Oakland, Calif. When homes are put up for sale in Oakland, they don’t last long. In February, houses were on the market for an average of just two weeks before they were sold.
As a result, they often attract multiple offers and sell for more than the asking price, according to Leslie Appleton-Young, chief economist for the California Association of Realtors…………………………………Full Article: Source

Posted on 15 March 2013 by Laxman |  Email |Print

What is an underwater mortgage? A mortgage is considered “underwater” when the amount of the mortgage is greater than the current value of the home. Another term for this is “negative equity.” For example, a person decides to buy a home for $200,000. They put 20 percent down, or $40,000, and then get a mortgage for the remaining $160,000. Usually home prices rise, but let’s say prices begin to fall and the home is now valued at $150,000. The mortgage is “underwater” by $10,000.
Why use the term ‘underwater’? Because the value of the home, which the mortgage funds, is below or under the mortgage amount, which could be considered the water line. It is just a metaphor that likely grew out of another metaphor: “drowning in debt.”………………………………..Full Article: Source

Posted on 15 March 2013 by Laxman |  Email |Print

Could home reno projects be the next shoe to drop for the country’s weakening housing sector? It’s an observation put forward by a Toronto market research firm this week that suggests renovation spending will suffer as a result of the unfolding downturn.
“You don’t want to spend money to renovate or make big changes to an asset when the value of the asset is declining,” Amna Asaf, economist at Capital Economics said by phone. “Already you’re losing money on the house itself.”………………………………..Full Article: Source

Posted on 15 March 2013 by Laxman |  Email |Print

Real estate investors are venturing out from the safety of the best buildings in Europe to gamble on edgier properties in a sign of risk-taking creeping back into the market as the euro zone crisis recedes.
Buildings that are partially or fully vacant, with short periods left on the lease or in need of a revamp, are in demand when they weren’t 12 months ago, some of the world’s biggest property funds told Reuters at the annual MIPIM property conference in Cannes this week…………………………………Full Article: Source

Posted on 15 March 2013 by Laxman |  Email |Print

U.K. commercial real estate values fell for the 16th consecutive month in February, led by a drop in retail properties, Investment Property Databank Ltd. said.
The average value of stores, offices and warehouses declined 0.2 percent from January, London-based IPD said in a statement today. Total return, which combines changes in real estate values and rental income, fell to 0.3 percent in February…………………………………Full Article: Source

Posted on 15 March 2013 by Laxman |  Email |Print

High house prices offer a solution to the long term care crisis, according to leading economist Ros Altmann, who says that more people should be encouraged to borrow against property to fund care for frailty in old age.
Equity release schemes, which used to be known as home income plans, enable homeowners aged over 55 to unlock wealth in bricks and mortar by means of a lifetime roll-up mortgage where no interest is paid on the debt until the borrower dies………………………………..Full Article: Source

Posted on 15 March 2013 by Laxman |  Email |Print

Recovery in the housing market has begun, claimed one property expert today, after banks and building societies reported that mortgage lending to home buyers had got off to its best start to the year since 2008.
A total of 38,300 loans were advanced for house purchase in January, down on the 45,900 taken out in December, but an 11 per cent increase from the 34,600 loans advanced in January last year…………………………………Full Article: Source

Posted on 15 March 2013 by Laxman |  Email |Print

The housing market has stabilised and prices are likely to rise in Dublin, a new report has predicted. But there is a risk to the market from banks repossessing buy-to-let properties and releasing hundreds of them for sale, NCB Stockbrokers said in a new report.
Steep fall in prices of recent years began to be arrested, the report found, referring to the latest Central Statistics Office information showing that prices had their slowest rate of decline since March 2008. NCB said excess supply in many areas, in particular the North and West of the country, means that Dublin and its surrounding counties should continue to outperform other areas…………………………………Full Article: Source

Posted on 15 March 2013 by Laxman |  Email |Print

It’s hard to get consumers to ramp up spending when residential property prices are slumping – the wealth effect drags down spending, as economies ranging from Spain and Ireland to the US have found in recent years.
Poland has been hit by the same phenomenon – one of the many reasons that retail spending has slumped, helping drag down the country’s economic performance. Polish residential real estate prices have been steadily falling for five years – but that trend may now be changing…………………………………Full Article: Source

Posted on 15 March 2013 by Laxman |  Email |Print

Domestic and international investors are set to increase their allocations to Belgian real estate. according to property adviser Savills. In the latest Belgium market report published at MIPIM, Savills said demand for well-let, prime assets is expected to continue to increase in 2013 as prime yields remain attractive at 5.75% for shopping centres and 5.35% for long-leased office buildings.
In addition, the adviser notes that the Belgian investment market recorded a 38% increase in 2012 compared to 2011 with a total volume of €2.01 bn…………………………………Full Article: Source

Posted on 15 March 2013 by Laxman |  Email |Print

Property prices in Dubai rose the second highest globally, registering a 20 per cent increase in 2012, a new global report has confirmed. “Dubai stands out with strong growth of 20 per cent in the price of luxury villas during 2012… the emirate rebounded in 2012 on the back of a resurgence in demand,” Knight Frank, a global property company, said in the Wealth Report 2013.
“This was aided by lower prices and underpinned by its [Dubai's] location as a strategic hub, able to attract wealth from the Middle East, North Africa, the Indian Subcontinent and Central Asia…………………………………Full Article: Source

Posted on 15 March 2013 by Laxman |  Email |Print

Developers are offering hefty price discounts on properties, gifting cars and home appliances to prop up sales. Real estate developers, brokers and marketing agencies have begun bombarding customers with unsolicited emails, text messages and phone calls to prop up sales in a sluggish market, which consultants believe is unlikely to pick up in the near term.
Not only are they offering hefty price discounts on properties but some are also bundling cars, home appliances, cash and non-cash discounts. Sample this unsolicited email advertisement sent to a Mint reader, who did not want to be named, on 13 March by property broker Capital First Ltd on behalf of Ekta Parksville by Ekta World Ltd…………………………………Full Article: Source

Posted on 15 March 2013 by Laxman |  Email |Print

Transactions of commercial properties and office buildings in Beijing surged 320.5 percent in the first 10 days of March month-on-month, data from Century 21st showed on Thursday. Around 759 units of commercial properties were sold and registered online by March 10, accounting for 6.3 percent of all the transactions recorded in the period.
Compared with the same period of last month, the figure is up 320.5 percent. The surge in the commercial property transactions follows the latest moves by the State Council to control the property market…………………………………Full Article: Source

Posted on 15 March 2013 by Laxman |  Email |Print

Investors dump shares of developers in favour of financials after three major banks raise mortgage rates by 25 basis points. Shares of Hong Kong developers fell yesterday after three major banks raised mortgage rates by 25 basis points amid mounting risk in the property market.
In response to the first rate rise in 18 months, Sun Hung Kai Properties, the world’s largest developer by market value, fell 3.3 per cent to HK$107.90, while Cheung Kong declined 0.94 per cent to HK$115.70. Henderson Land Development and Hang Lung Properties dropped 3.3 and 2 per cent, respectively…………………………………Full Article: Source

Posted on 15 March 2013 by Laxman |  Email |Print

Australian investors are over-weighted in residential property, according to Australian Unity Investments.The manager has said it is important that investors, particularly those with self-managed super funds, broaden their approach to property investment to include more than just the residential sector.
“Generally speaking, Australians are over-exposed to residential property, especially those that own an investment property as well as their home,” said Australian Unity’s head of healthcare and retirement property, Chris Smith…………………………………Full Article: Source

Posted on 15 March 2013 by Laxman |  Email |Print

Low interest rates have been supporting the established housing market, and prices have been moving higher in many residential markets across Australia, however they remain below earlier peaks in most markets, the Reserve Bank of Australia has noted.
The general improvement in sentiment was apparent in auction clearance rates, the bank assistant governor (economy) Christopher Kent said in an address to The Australian Institute of Building last night…………………………………Full Article: Source

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