Positive Outlook for Dubai Real Estate in 2016
As the emirate continues its preparation to host World Expo 2020, Dubai’s real estate is proving an attractive proposition to international property investors.
With investment in mega infrastructure projects and increased construction supporting contin…
Investor Appetite Increasing for Thai Hotel Opportunities
Despite the sluggish economy, demand remains strong for real estate in Thailand with the nation currently leading the region in the hotel residence boom, the property investor’s vehicle of choice throughout 2015.
Economists estimate the real estate market grew by almost 10% this year after receiving a boost from the government’s property stimulus measures, implemented to stimulate interest from property buyers overseas.
The stimulus measures include reductions in housing transfer and mortgage fees, personal income tax deductions for those purchasing a property for less than €75,000 and soft loans amounting to €250,000 offered by Thailand’s Government Housing Bank, (GH Bank) .
In October last year, the cabinet approved cuts in housing transfer and mortgage fees to 0.01% each for six months for homes priced at €75,000 or less, down from 2% and 1% respectively. Also approved was a proposal allowing first-time buyers who purchase a home below the same threshold to deduct 20% of the value of the home from their annual personal income tax over a five-year period.
Thai Condominium Association president Prasert Taedullayasatit said the tax incentives would boost the overall housing market in the fourth quarter by 20%-30%, increasing full-year housing market values by 12.6% from last year.
Investment in hotel residences surged in Thailand in 2015, with many opportunities falling well below the new threshold for tax incentives. The sector has a significantly improved outlook on the back of the Thai government’s stimulus measures and construction has been stepping up to meet rapidly increasing demand for robust, income-generating assets in branded hotels.
According to research by Thai-based hospitality consulting group C9 Hotelworks, there are currently more than 28,000 hotel-branded residential units for sale across the region overall, representing almost 120 projects. In Thailand, there are 44 developments on the market, representing 4,775 units, with the top three locations for hotel residences being Phuket, Bangkok and Pattaya.
The average price per square metre for urban properties in Thailand is €5,960, while in resort destinations it is €3,283. One key catalyst for the rising tide of buyer interest has been an increasing number of mixed-use projects that contain hotel and real estate components. Recognised hotel brands are being tapped to help engineer pricing premiums for property sales, which in market-wide terms has equated to 26% in urban locations and 14% for resort products.
Commenting on the research, C9 managing director Bill Barnett said: ” The historic pattern of hotel and real estate marriages has moved away from the beach and leisure destinations and is gaining traction in urban city offerings. Traditional lifestyle buyers are being supplanted by end users, with Asians representing the largest transaction segment. Bangkok’s stirring success story at the St Regis Residences demonstrated this, while the more recent Four Seasons offering has struck a chord with both local and overseas buyers “.
The two leading Southeast Asian real estate marketplaces are Thailand, offering 37% of the region’s hotel project residences, followed by Indonesia with a 22% share.
Article by +Roxanne James on behalf of Propertyshowrooms.com
Bulgaria’s Property Market to Strengthen Further in 2016
Property consultants Cushman & Wakefield reported a record year for foreign investment in Bulgaria last year with real estate sales contributing €239 to the economy, predicting a continued rising demand throughout 2015.
After prolonged economic hardship following the global financial crisis, Bulgaria’s property market remains at a huge discount to peak 2007 prices, attracting wealthy foreign investors with opportunities to acquire land and property at rock-bottom prices.
Polina Stoykova, managing director of Bulgarian Properties said: ” An important element of the new market reality is the return of confidence in the property market. More and more buyers are thinking of buying property because real estate is a safe real asset and good investment. This understanding coincided with a very favourable moment in the property market development because real estate prices are currently at levels from ten years ago and respectively, the properties are much more affordable. We could also add to the picture the improved mortgage conditions now offered by the banks “.
Apart from price, another dynamic property investors are interested in is tourism. Most foreign investors seek to take advantage of resort properties with excellent occupancy rates that ensure consistent rental revenue streams in a growing market. Bulgaria has risen through the ranks as one of Europe’s most popular alpine resorts, offering exceptional value for family ski holidays and with plenty of breathtaking beaches the country has a whole lot more on offer besides.
Bulgaria enjoyed an extremely successful winter season in 2014/2015 that saw more than 80,000 visitors to its alpine resorts, boosting the nation’s economy by €17.5m. According to the country’s tourism minister Nikolina Angelkova, the number of visitors from Turkey increased by almost 30% as a result of the simplification of visa requirements while German tourists increased by around 17%.
At the beginning of August last year, budget flight operators Ryanair issued a press release that is set to boost Bulgaria’s tourism and real estate sectors moving forward into 2016. The airline’s Robin Kiely said: ” Ryanair is pleased to announce a new daily London Stansted to Sofia route beginning May 2016 which will go on sale on www.ryanair.com in September. Sofia is another key capital city airport and our second in Bulgaria as we continue to grow Europe’s largest route network, with more routes and flights and improved schedules “.
Property prices in Bulgaria have also been buoyed by weak supply due to limited construction. This has impacted markets in the country’s large cities and resort areas the most and with off-plan investment opportunities thin on the ground, prices look set to continue rising.
As a direct result of Bulgaria’s fantastic winter season and the financial injection to its economy, property prices are forecast to stabilise as the economic recovery is consolidated. Modest price growth in both commercial and residential property sectors is expected throughout the year, matched by stable economic growth that will underpin investment in Bulgaria.
According to a report by real estate researchers Colliers International , foreign investors are expected to steadily increase their exposure in Bulgaria’s commercial property market throughout 2016, depending on the availability of product for sale. Investor returns will continue to be driven by rental upside, discounts on existing debt and lower interest rates and strong income generating assets in Bulgaria’s commercial occupational markets will continue to attract more investment capital.
Article by +Roxanne James on behalf of Propertyshowrooms.com
Cape Verde Emerges as Tourist Hotspot in 2015
Cape Verde’s National Statistics Institute (INE) reported a 2% annual increase in visitor numbers in the first half of 2015, putting the country on target for a bumper year for tourism.
In the first six months of the year, more than 278,000 visitors arrived on the beautiful archipelago off the northwest coast of Africa, attracted by its fabulous beaches known as jumping-off points for windsports and a great location for diving among shipwrecks.
During the second quarter, Cape Verde hosted 116,200 tourists representing a 4.8% increase on the same period of 2014, despite the country’s relatively under-developed tourism infrastructure. Overnight stays in H1 increased 3.5% to almost 1.8 million with hotels remaining the most popular type of accommodation for 87.3% of visitors to the tiny archipelago nation.
The data reveals that the second quarter of the year saw mostly British tourists arriving in Cape Verde, representing around 25% of international visitors. Brits holidayed for an average stay of 9 days with the island of Sal as the most popular resort location, accounting for around 46% of overnight stays in hotel establishments.
Cape Verde is a former Portuguese colony and maintains close links with Portugal and the Eurozone. Special partnership status has been granted by the EU and in 2008 Cape Verde joined the World Trade Organisation. The country has improved significantly to achieve economic stability with plenty of potential for further growth, particularly through its tourist sector.
The country’s democracy is one of Africa’s most stable and Cape Verde was officially removed from the Unite Nations list of Least Developed Countries in December 2007. The country’s outlook has never been better according to the World Bank , recently reporting that ‘good governance, sound macroeconomic management, trade openness and increased integration into the global economy, as well as the adoption of effective social development policies underpinned an impressive development trajectory’.
Around half of Cape Verde’s 482,000 population lives on the biggest island, Santiago which is home to the capital city, Praia. Tourism is mostly concentrated on the island of Sal which has the country’s only international airport capable of receiving charter flights from Europe. New and bigger international airports are scheduled to be opened in Santiago, San Vicente and Boa Vista, boosting residential property prices in those areas.
Almost every habitable island of the archipelago has new development in construction. Capital values are consequently rising by 10%-15% annually and yet property in Cape Verde is still very much a bargain at around €1,200-€1,650/m2.
Cape Verde remains largely undiscovered to international travellers, despite its unique cultural vibe and breathtaking beauty. Data from the INE from 1997 shows that 45,000 visitor arrivals were recorded for the year compared with more than 500,000 expected in 2015, illustrating the country’s massive rise in popularity among international travellers.
Consequently, the archipelago has been overlooked by property investors and the market for holiday rentals is almost non-existent. A studio unit in popular Santa Maria is currently priced at around €81,000 which would offer a yield in the region of 8%-9%, according to local realtors.
The ten archipelago islands of Cape Verde are clustered 280 miles off the coast of Africa, approximately one hour south of the Canary Islands. Notable for its vibrant blend of Portuguese and African cultures the country is also blessed with long stretches of fine white sandy beaches and an all year round perfect temperature of between 25 and 34 degrees.
With booming tourism and discounted real estate, it won’t be long before investors zoom in on Cape Verde’s bountiful property market. For investors seeking a lower entry level property purchase, there are investment opportunities in the country’s hotel sector currently attracting interest among buyers of income generating assets, starting from as little as €10,000.
Article by +Roxanne James on behalf of Propertyshowrooms.com
Investors Look beyond Paris for Bargains in France
As property prices in Paris continue with their upward movement, restricting yield opportunities for international investors, many are now seeking value in regional cities such as Lyon, Marseille, Toulouse, Bordeaux, Nantes, Lille and Strasbourg.
At a presentation at the Munich trade fair in October last year, David Green-Morgan, JLL’s global capital markets research director said: ” Over the past 2-3 years we have seen a change in behaviour. Now investors, particularly from Asia are seeing real estate, particularly in Europe as a safe haven – and the emphasis on wealth preservation especially from Asia has become more important “.
Although many investors tend to focus on bigger cities such as Paris, a lot of capital is looking to generate more aggressive returns and therefore there is a rising interest in regional opportunities. This is a trend that is also happening outside London in the UK and outside the Big Six in the German market, (Munich, Düsseldorf, Frankfurt, Berlin, Hamburg and Cologne).
Peter Rawls, investor relations director for the huge Euroméditerranée urban renewal project on the sea front in Marseille, said yields in prime offices in the city are between 5.76% and 6.1%, comparable to other regional cities in France . Availability of capital is not the problem and many large investors such as Germany’s Union Investment Real Estate and US manager Pramerica are already allocated. ” The main challenge is that those who are already invested don’t want to sell, ” he said.
However, regional cities are attracting families through quality of life and industry is stepping up to provide employment. The Airbus group has it’s headquarters in Toulouse with divisions in other French regions and its main helicopter arm is based near Marseille airport. Marseille also acts as a gateway to Africa which is attractive for commercial real estate investors, particularly from China.
Jean-Philippe Blangy, managing director of UK-based fund manager Tristan Capital Partners said his firm hasn’t yet developed a strategy for French regions but is beginning to look at more opportunities in France. All the major regional cities are attractive for potential office investment, while retail value can be found throughout France, even in smaller locations. ” We have €5bn of assets under investment and most of that so far in Germany, UK and Spain – but there is no specific focus on the regions, ” he said. ” In France our investments are 100% in Paris and zero in the regions “.
According to Blangy, the yield spread between Paris and Marseille is much wider than that between Berlin and London, and even regional cities in Germany are closer to less attractive capital market yields.
” But in France the yields are still more attractive and the good thing in France is that you can still get decent financing, ” he said, adding that foreign investors have an inaccurate perception of value in French residential property where he believes rent restrictions are no more hindrance than in Germany.
Green-Morgan indicated there is a reversal of the global trend out of the regions and into the major cities. In France, the efficient rail infrastructure is helping this trend. A lot of Asian capital is coming to Europe and holding long term, he said.
” Most of the Asian capital is focusing in general on locations where it can close deals more easily. But what we are seeing particularly from the Chinese capital is that it is much more inclined to go into regional markets now, and particularly on the development side “.
Article by +Roxanne James on behalf of Propertyshowrooms.com
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