NEWS
Priced-Out Londoners invest in Birmingham’s Bargains
Property investors in London are seeking bargains in the regions, particularly Birmingham where two apartments can be bought for the price of one in the capital.
Birmingham’s profile as a property investment hotspot has increased dramatically, confirmed in a recent report by PwC and the Urban Land Institute which says the West Midlands city is set to overtake London as the most attractive city for property investment over the next 12 months.
According to Knight Frank’s Birmingham Report, there will be 18,500 new households in the city by 2019, with the rate of supply likely to fall short of demand by some 2,000 homes, which will inevitably push up prices.
Property in Birmingham has risen 8.27% in value over the past two years, according to data from Zoopla although it is still possible to buy a three-bedroom town house in the now fashionable Jewellery Quarter for around £250,000.
Major Mahil, director of Birmingham estate agents Belvoir said: ” We are finding that lots of investors from London are looking here because they’ve been priced out of the market in the capital. We’ve had people buying up blind. There’s a real feeling of buoyancy “.
Birmingham’s central location in England is fast-expanding as a transportation hub, from where you can reach almost any part of the country. The internationally famous brand John Lewis is on the verge of opening its second-biggest store in the UK above New Street Station in the City’s centre which itself has been completely revamped.
HSBC has announced its decision to build new headquarters in Birmingham City for its retail and commercial banking business, moving 1,000 jobs from London by mid-2017; Deutsche Bank is also setting up shop in the city. As the influx of retail giants and international financial institutions in the city gathers pace, demand for homes in the district is increasing exponentially.
Property investment will be further boosted by the arrival of high-speed rail HS2, set to reduce the train journey times between Birmingham and London to a mere 49 minutes. There are several reasons Birmingham is under the investor microscope in 2015 and further significant growth is anticipated.
Birmingham’s buy-to-let market has expanded on the back of improving dynamics in the City. Ray Withers, chief executive of leading property investment specialists Property Frontiers said: ” The UK’s second-tier cities such as Birmingham have created an excellent environment for buy-to-let investors. Rising prices have created the opportunity for capital growth, while the potential for healthy yields has led to the right developments selling out fast “.
With a population of 1.1 million and an average age of just over 35, Birmingham has plenty of professionals looking for rental accommodation. It is a busy, vibrant city and home to some of the UK’s leading companies, set to expand significantly as more international businesses enter Birmingham’s real estate arena in the coming years.
Birmingham is also subject to a £500m regeneration programme recently unveiled by the government – a project that includes 100,000m 2 of retail space, 1,000 new homes and a metro tramline.
First time buyers are on the rise in Birmingham, particularly in popular suburbs like Harborne. Andy Thomas of Hunters’ Harborne branch said: ” I was born and bred here and the quality of life is one of the incentives for people coming to Birmingham. If you go five miles from Harborne, you can be in lovely countryside “.
Investors from the capital have been attracted to Birmingham’s real estate largely because of price disparity presenting better opportunities for solid capital growth and high rental yields, particularly in comparison with London prices.
Daniella Willets, manager of estate agents Connells reports that 60% of flats in Birmingham City centre are being bought by London investors. ” They are finding that they can buy two flats for the price of one in London and the yields are better too, ” she said.
Article by +Roxanne James on behalf of Propertyshowrooms.com
read moreChinese Buyers’ Penchant for Australia’s Apartments Boosts Economy
According to research published by real estate company CBRE, Chinese investors have led the surge in foreign investment in residential developments, acting as a prop for Australia’s ailing economy.
In the year to April 2015, foreign capital backed 54 of the 115 inner-city development sites sold in Sydney, Melbourne and Brisbane, with Chinese developers claiming 36 of those deals.
CBRE estimates that Chinese investment in Australian real estate reached €5.3bn in the first six months of this year, which was 25% of all offshore Chinese property purchases. Australia’s share of Chinese capital flowing into global real estate markets has risen from 10% in the past two years.
Chinese-backed Aqualand are major players in Australia’s real estate sector, acquiring almost €1bn of development sites across Sydney and Perth, with the largest being its €160m purchase of three waterfront buildings, including the Seven Group’s headquarters in Sydney’s inner-city, Pyrmont.
Aqualand’s general manager Wayne Xiong said it was one of the seven projects being developed and that it combined preservation of heritage buildings on the waterfront with the opportunity for freehold purchase, offering ” something highly sought after by local buyers as well as meeting the expectations of the international market “.
Another large scale Chinese investor is Ping An Insurance, China’s second-largest insurer which is expected to commit hundreds of millions to Australia’s housing market over the next few years. The private held company, which controls the separately listed Ping An Bank is close to signing a deal with one of Australia’s biggest developers, Mirvac Group , to part-fund a luxury apartment complex in Sydney.
Enterprises owned by the Chinese state are also active in Australia. Greenland Holding Group, China’s largest state-owned real estate group, has a development portfolio in Australia worth almost €1bn.
Its largest project is Greenland Centre in Sydney’s central business district (CBD). It will be Sydney’s tallest residential tower, including 470 apartments and six penthouses over 66 levels, nearly all pre-sold. Local partner Brookfield Multiplex estimates construction will generate around 5,500 jobs, boosting the local economy significantly.
Justin Brown, executive director of residential projects for CBRE said: ” The scale they’re used to deal with is so much larger than local developers. They have an additional perspective where they’re used to delivering 10,000 to 15,000 apartments a year “.
According to Australia’s Foreign Investment Review Board , Victoria is getting most of the offshore property funding, with foreign purchasers restricted to buying new properties accounting for just over 18% of all residential sales in the state, compared with 10% in New South Wales.
Senior property analyst at ANZ bank, David Cannington said the growth in apartment construction was being driven by high-rise developments, currently running at an annual pace of 80,000 units, up from 33,000 in 2012-2013. He added that nearly all projects were pre-sold ahead of completion, with little evidence of purely speculative property development by foreign investors.
The significant Chinese interest in Australian real estate has instigated an apartment building boom that has been responsible for a fifth of the nation’s economic growth over the past two years, assisting the county’s recovery following the end of the mining construction boom.
The number of new apartment projects winning approval from local councils has almost doubled since 2013 to 105,000 new residential units over the past financial year, with apartments accounting for 95% of the growth in housing construction in that period.
The latest June quarter national accounts showed housing construction was €3.8bn or 24% higher than in the same quarter two years ago. Australia’s nominal economy overall has risen €17.8bn, representing growth of 5.5% over that time.
Article by +Roxanne James on behalf of Propertyshowrooms.com
read moreChinese Buyers’ Penchant for Australia’s Apartments Boosts Economy
According to research published by real estate company CBRE, Chinese investors have led the surge in foreign investment in residential developments, acting as a prop for Australia’s ailing economy.
In the year to April 2015, foreign capital backed 54 of the 115 inner-city development sites sold in Sydney, Melbourne and Brisbane, with Chinese developers claiming 36 of those deals.
CBRE estimates that Chinese investment in Australian real estate reached €5.3bn in the first six months of this year, which was 25% of all offshore Chinese property purchases. Australia’s share of Chinese capital flowing into global real estate markets has risen from 10% in the past two years.
Chinese-backed Aqualand are major players in Australia’s real estate sector, acquiring almost €1bn of development sites across Sydney and Perth, with the largest being its €160m purchase of three waterfront buildings, including the Seven Group’s headquarters in Sydney’s inner-city, Pyrmont.
Aqualand’s general manager Wayne Xiong said it was one of the seven projects being developed and that it combined preservation of heritage buildings on the waterfront with the opportunity for freehold purchase, offering ” something highly sought after by local buyers as well as meeting the expectations of the international market “.
Another large scale Chinese investor is Ping An Insurance, China’s second-largest insurer which is expected to commit hundreds of millions to Australia’s housing market over the next few years. The private held company, which controls the separately listed Ping An Bank is close to signing a deal with one of Australia’s biggest developers, Mirvac Group , to part-fund a luxury apartment complex in Sydney.
Enterprises owned by the Chinese state are also active in Australia. Greenland Holding Group, China’s largest state-owned real estate group, has a development portfolio in Australia worth almost €1bn.
Its largest project is Greenland Centre in Sydney’s central business district (CBD). It will be Sydney’s tallest residential tower, including 470 apartments and six penthouses over 66 levels, nearly all pre-sold. Local partner Brookfield Multiplex estimates construction will generate around 5,500 jobs, boosting the local economy significantly.
Justin Brown, executive director of residential projects for CBRE said: ” The scale they’re used to deal with is so much larger than local developers. They have an additional perspective where they’re used to delivering 10,000 to 15,000 apartments a year “.
According to Australia’s Foreign Investment Review Board , Victoria is getting most of the offshore property funding, with foreign purchasers restricted to buying new properties accounting for just over 18% of all residential sales in the state, compared with 10% in New South Wales.
Senior property analyst at ANZ bank, David Cannington said the growth in apartment construction was being driven by high-rise developments, currently running at an annual pace of 80,000 units, up from 33,000 in 2012-2013. He added that nearly all projects were pre-sold ahead of completion, with little evidence of purely speculative property development by foreign investors.
The significant Chinese interest in Australian real estate has instigated an apartment building boom that has been responsible for a fifth of the nation’s economic growth over the past two years, assisting the county’s recovery following the end of the mining construction boom.
The number of new apartment projects winning approval from local councils has almost doubled since 2013 to 105,000 new residential units over the past financial year, with apartments accounting for 95% of the growth in housing construction in that period.
The latest June quarter national accounts showed housing construction was €3.8bn or 24% higher than in the same quarter two years ago. Australia’s nominal economy overall has risen €17.8bn, representing growth of 5.5% over that time.
Article by +Roxanne James on behalf of Propertyshowrooms.com
read moreSpanish Property Prices up 5% on Foreign Buying
Since Spain’s real estate bubble burst in 2008 and brought its economy crashing down with it, foreign money has been driving recovery in the nation’s property market.
According to Spain’s Property Registrars , annual price growth in June 2015 showed an annual increase of 5.12%, driving by strong sales to foreign nationals in the country’s prime property markets.
Transaction volumes have also increased, according to the latest ” Spain Real Estate Flash ” published by BBVA Research which notes that 188,432 home purchases were completed in the first six months of the year in Spain, representing an increase of 7.9% over the same period. The Spanish bank reports that increased access to credit together with low interest rates, growth in employment and the improvement of consumer confidence are key factors behind Spain’s property market recovery.
BBVA state in its report that ‘construction activity has shown significant growth, albeit from relatively low levels,’ and the ‘macroeconomic prospects for the second half of the year will continue to contribute to the sector’s recovery’.
The report also highlights the fact that 17% of housing transactions carried out in the first three months of the year in Spain were made by foreigners, saying that ‘the sound health of some of the key economies that generate demand for housing in Spain, such as Germany and the United Kingdom, combined with the depreciation of the euro, continue to be major assets for the Spanish real estate market’.
Increased foreign buyer interest in Spain
Spain’s property registrars report that foreign nationals purchased 12.2% of residential properties in the first quarter of 2015, up from 9% in 2006. The impact of foreign investment in property is most prominent in Spain’s luxury market. Home prices fell more than 35% between 2007 and 2013, according to the country’s statistics bureau, presenting foreign investors with a wealth of opportunities for considerable value growth.
Indeed, areas popular with foreign investors – such as Pedralbes and the Passeig de Grácia in Barcelona and Salamanca and Chamberí in Madrid – have already recovered 20% of value lost since the property market crash in 2008.
Increased foreign buyer interest in Spain is reflected in price growth and now house prices have increased at their fastest rate since the downturn.
The latest rise in price growth means that property prices are now down 29% nationally since the peak of the market, with significant regional variations according to buyer activity. The recovery in the Spanish property market is limited to the most popular areas where houses are in demand such as Madrid, the Balearics, the Canaries, Catalonia and the Valencian Community and is reflected in buoyant local property prices.
The statistics from the Spanish property registrars show that the country’s real estate sector closed the first half of the year with a positive balance and the fundamentals of the economy indicate that this trend will continue in the second half in a context of price stability, according to the BBVA’s report.
Alex Vaughan, co-founder of Lucas Fox, the Barcelona-based luxury estate agent said: ” At the high end – €500k and up – it’s primarily being driven by international demand “. The estate agent sold two-thirds of the units in the luxurious Bonavista development in Barcelona, with 91% of its 126 sales going to foreign buyers.
Over the last two years, the demographic of foreign buyers in Spain has shifted from Europe to the Middle East, Asia and the US. While the depreciation of the euro has attracted non-Europeans, the collapse of the rouble and tighter rules on currency transfers have kept out some Russians and other investors.
American buyers are on the rise, with purchasing power boosted significantly by the dollar’s dominance over other currencies this year, and French buyers, reluctant to expose capital to restrictive taxation policies at home, have been house-hunting in Spain’s property markets more enthusiastically in 2015.
The modest but sustainable recovery of Spain’s economy has resulted in GDP growth of 2.7% over the past year and the nation’s banks have begun to lend again. During the first quarter of 2015, Spanish banks signed nearly a third more mortgages for 27% more capital than during the same period last year, signalling a return of domestic buyers that will underpin price growth nationally in coming years.
Article by +Roxanne James on behalf of Propertyshowrooms.com
read moreSpanish Property Prices up 5% on Foreign Buying
Since Spain’s real estate bubble burst in 2008 and brought its economy crashing down with it, foreign money has been driving recovery in the nation’s property market.
According to Spain’s Property Registrars , annual price growth in June 2015 showed an annual increase of 5.12%, driving by strong sales to foreign nationals in the country’s prime property markets.
Transaction volumes have also increased, according to the latest ” Spain Real Estate Flash ” published by BBVA Research which notes that 188,432 home purchases were completed in the first six months of the year in Spain, representing an increase of 7.9% over the same period. The Spanish bank reports that increased access to credit together with low interest rates, growth in employment and the improvement of consumer confidence are key factors behind Spain’s property market recovery.
BBVA state in its report that ‘construction activity has shown significant growth, albeit from relatively low levels,’ and the ‘macroeconomic prospects for the second half of the year will continue to contribute to the sector’s recovery’.
The report also highlights the fact that 17% of housing transactions carried out in the first three months of the year in Spain were made by foreigners, saying that ‘the sound health of some of the key economies that generate demand for housing in Spain, such as Germany and the United Kingdom, combined with the depreciation of the euro, continue to be major assets for the Spanish real estate market’.
Increased foreign buyer interest in Spain
Spain’s property registrars report that foreign nationals purchased 12.2% of residential properties in the first quarter of 2015, up from 9% in 2006. The impact of foreign investment in property is most prominent in Spain’s luxury market. Home prices fell more than 35% between 2007 and 2013, according to the country’s statistics bureau, presenting foreign investors with a wealth of opportunities for considerable value growth.
Indeed, areas popular with foreign investors – such as Pedralbes and the Passeig de Grácia in Barcelona and Salamanca and Chamberí in Madrid – have already recovered 20% of value lost since the property market crash in 2008.
Increased foreign buyer interest in Spain is reflected in price growth and now house prices have increased at their fastest rate since the downturn.
The latest rise in price growth means that property prices are now down 29% nationally since the peak of the market, with significant regional variations according to buyer activity. The recovery in the Spanish property market is limited to the most popular areas where houses are in demand such as Madrid, the Balearics, the Canaries, Catalonia and the Valencian Community and is reflected in buoyant local property prices.
The statistics from the Spanish property registrars show that the country’s real estate sector closed the first half of the year with a positive balance and the fundamentals of the economy indicate that this trend will continue in the second half in a context of price stability, according to the BBVA’s report.
Alex Vaughan, co-founder of Lucas Fox, the Barcelona-based luxury estate agent said: ” At the high end – €500k and up – it’s primarily being driven by international demand “. The estate agent sold two-thirds of the units in the luxurious Bonavista development in Barcelona, with 91% of its 126 sales going to foreign buyers.
Over the last two years, the demographic of foreign buyers in Spain has shifted from Europe to the Middle East, Asia and the US. While the depreciation of the euro has attracted non-Europeans, the collapse of the rouble and tighter rules on currency transfers have kept out some Russians and other investors.
American buyers are on the rise, with purchasing power boosted significantly by the dollar’s dominance over other currencies this year, and French buyers, reluctant to expose capital to restrictive taxation policies at home, have been house-hunting in Spain’s property markets more enthusiastically in 2015.
The modest but sustainable recovery of Spain’s economy has resulted in GDP growth of 2.7% over the past year and the nation’s banks have begun to lend again. During the first quarter of 2015, Spanish banks signed nearly a third more mortgages for 27% more capital than during the same period last year, signalling a return of domestic buyers that will underpin price growth nationally in coming years.
Article by +Roxanne James on behalf of Propertyshowrooms.com
read moreScotland’s Rent Controls Could Hinder Buy-to-Let Investment
The Scottish Government is planning to introduce rent controls in ‘pressure areas’ as part of a package of measures announced by First Minister Nicola Sturgeon last week.
The Private Tenancies Bill will offer tenants ” protection against excessive rent rises, while also giving clear rights and safeguards to landlords, ” Sturgeon said, amid concerns the measures are counter-productive to the government’s hopes of attracting institutional investment to deliver large-scale, purpose-build development.
Gerry More, who was appointed last October by construction trade body Homes for Scotland, to help drive investment into the private rented sector (PRS) said: ” Whilst a simpler, streamlined and fairer tenancy system is welcome, this should not be to the detriment of building the high quality and professionally-managed homes in the private rented sector that are required to help meet demand. “
” I am therefore concerned that this move could prove counter-productive since these pressurised areas are exactly where investment to increase the supply and quality of PRS properties is needed most. “
Gerry More’s comments were echoed by Pete Chambers, property partner at law firm Burness Paull, who said over-regulation of the sector could have a negative effect by scaring away the long-term investors that the government hopes to attract.
Chambers said: ” We are seeing a lot of UK funds and property companies looking at PRS in Scotland . Anything that makes investment less attractive in Scotland versus the rest of the UK could negatively impact upon the likelihood of these parties investing. This could result in reduced provision of rental property, which in turn could exasperate the housing shortage and push up rents – the very thing the legislation is designed to protect against. “
There are around 330,000 properties in Scotland’s private rented sector, of which an estimated 80,000 are occupied by families, according to campaign group PRS 4 Scotland. Another 14,000 are ‘houses in multiple occupation’ providing accommodation for around 60,000 people, while 130,000 are rented by couples or individuals.
An estimated 465,000 new homes are required by 2035 to meet demand but the Scottish Property Federation warned that rent controls could ‘sound the death knell’ for investment in the build-to-rent market.
David Melhuish, the trade association’s director said: ” If the Scottish Government wants to increase housing supply, then the introduction of rent controls is not the way to do it. We should be doing everything we can to encourage investment rather than regulate this sector before it has had a chance to take root. “
According to a government spokesman, investors have nothing to fear from the proposed legislation. A spokesman commented: ” Our aim is to provide good quality homes and protection for hundreds of thousands of families, modernising the private rented sector to make it more professionally managed and better regulated for those who want to live, work and invest in it. “
” We want to see supply grow to meet demand – this is the sustainable, long-term solution to addressing housing affordability. That’s why we are investing £1.7bn in affordable housing and will now exceed our target of delivering 30,000 homes by 2016, including 18,600 homes for social rent. “
The proportion of people living in the PRS in Scotland has doubled over the past 10 years, according to official statistics. Figures from the Scottish Household Survey , published in August show that 14% of Scotland’s 2.2 million households were renting privately in 2014, compared with 7% in 2004.
The percentage of people living in social housing declined from 32% in 1999 to 23% in 2007. The social sector has remained at around 23% of all Scotland’s households since then, and was 24% in 2014, according to the statistics. The percentage of people who own their own homes also declined from 66% in 2005 to 60% in 2014, although the proportion of households owning outright increased from 22% in 1999 to 30% in 2007, and has remained the same since.
Article by +Roxanne James on behalf of Propertyshowrooms.com
read moreScotland’s Rent Controls Could Hinder Buy-to-Let Investment
The Scottish Government is planning to introduce rent controls in ‘pressure areas’ as part of a package of measures announced by First Minister Nicola Sturgeon last week.
The Private Tenancies Bill will offer tenants ” protection against excessive rent rises, while also giving clear rights and safeguards to landlords, ” Sturgeon said, amid concerns the measures are counter-productive to the government’s hopes of attracting institutional investment to deliver large-scale, purpose-build development.
Gerry More, who was appointed last October by construction trade body Homes for Scotland, to help drive investment into the private rented sector (PRS) said: ” Whilst a simpler, streamlined and fairer tenancy system is welcome, this should not be to the detriment of building the high quality and professionally-managed homes in the private rented sector that are required to help meet demand. “
” I am therefore concerned that this move could prove counter-productive since these pressurised areas are exactly where investment to increase the supply and quality of PRS properties is needed most. “
Gerry More’s comments were echoed by Pete Chambers, property partner at law firm Burness Paull, who said over-regulation of the sector could have a negative effect by scaring away the long-term investors that the government hopes to attract.
Chambers said: ” We are seeing a lot of UK funds and property companies looking at PRS in Scotland . Anything that makes investment less attractive in Scotland versus the rest of the UK could negatively impact upon the likelihood of these parties investing. This could result in reduced provision of rental property, which in turn could exasperate the housing shortage and push up rents – the very thing the legislation is designed to protect against. “
There are around 330,000 properties in Scotland’s private rented sector, of which an estimated 80,000 are occupied by families, according to campaign group PRS 4 Scotland. Another 14,000 are ‘houses in multiple occupation’ providing accommodation for around 60,000 people, while 130,000 are rented by couples or individuals.
An estimated 465,000 new homes are required by 2035 to meet demand but the Scottish Property Federation warned that rent controls could ‘sound the death knell’ for investment in the build-to-rent market.
David Melhuish, the trade association’s director said: ” If the Scottish Government wants to increase housing supply, then the introduction of rent controls is not the way to do it. We should be doing everything we can to encourage investment rather than regulate this sector before it has had a chance to take root. “
According to a government spokesman, investors have nothing to fear from the proposed legislation. A spokesman commented: ” Our aim is to provide good quality homes and protection for hundreds of thousands of families, modernising the private rented sector to make it more professionally managed and better regulated for those who want to live, work and invest in it. “
” We want to see supply grow to meet demand – this is the sustainable, long-term solution to addressing housing affordability. That’s why we are investing £1.7bn in affordable housing and will now exceed our target of delivering 30,000 homes by 2016, including 18,600 homes for social rent. “
The proportion of people living in the PRS in Scotland has doubled over the past 10 years, according to official statistics. Figures from the Scottish Household Survey , published in August show that 14% of Scotland’s 2.2 million households were renting privately in 2014, compared with 7% in 2004.
The percentage of people living in social housing declined from 32% in 1999 to 23% in 2007. The social sector has remained at around 23% of all Scotland’s households since then, and was 24% in 2014, according to the statistics. The percentage of people who own their own homes also declined from 66% in 2005 to 60% in 2014, although the proportion of households owning outright increased from 22% in 1999 to 30% in 2007, and has remained the same since.
Article by +Roxanne James on behalf of Propertyshowrooms.com
read moreCyprus to Resolve Title Deed Fiasco or No Further Bailout
The European Union, European Central Bank and International Monetary Fund have combined forces to place pressure on Cyprus to immediately implement laws ensuring title deeds are passed directly to property buyers after purchase.
For decades, Cyprus’ deeds fiasco has left owners of newly developed property without title deeds to their homes, leading to disputes over ownership and in some cases losing their homes altogether.
Due to increasing pressure from British buyers of Cypriot properties in the last few years, Cyprus is having its hand forced to resolve the situation immediately, or the country will not receive the next instalment of its €500 million euro crisis bailout.
In 2008 in the immediate aftermath of the financial crisis, 50,000 British buyers in Cyprus petitioned Britain’s 72 MEPs to put aside political allegiances and work together on their behalf to obtain title deeds for properties purchased from developers in previous years.
The scandal came about as developers failed to inform potential buyers that the title deeds for their homes would be withheld for an unspecified time and that the land on which their property was built was in fact mortgaged by the developer and not purchased outright.
The consequences for buyers meant increased liability to property charges, a burden of huge legal fees and many were left unable to sell property to recoup losses. In some cases, developers declared bankruptcy and were then unable to transfer title deeds and full legal ownership to buyers before settling any mortgage debt on the land. Despite buyers paying for their homes in full, without legal proof of ownership there was simply no legal recourse available to them.
Title deeds are passed directly to buyers
The new laws ensuring title deeds are passed directly to buyers were to be in place by the end of last week, as demanded by the EU, the ECB and IMF, much to the relief of the thousands of investors who have still not received the deeds to their homes that were built years ago.
The Cypriot Council of Ministers has approved a new law which is now on its way through the Cypriot Parliament. Not only will it help those who have never received title deeds but it will also bring essential stimulus to the country’s struggling property market.
The government has unveiled a number of incentives set to benefit buyers and sellers and boost real estate investment. Anyone buying property in Cyprus from now until the end of 2016 will qualify for a 50% discount on the property title deeds transfer tax. There will also be no capital gains tax when those who buy in this timescale want to sell in the future, a saving of 20%.
Estate agents in Cyprus anticipate more enquiries from overseas investors on the back of the legislative changes. Ideal Homes International has seen increasing interest from British buyers. ” UK buyers are particularly excited about what they can get for their money, given the strength of the pound so far this year, ” said director Chris White.
” Cyprus’ historical relationship with the UK means that there are many aspects of life there that UK buyers feel comfortable with, everything from similar legal systems to driving on the left. Contracts are written in English and everyone speaks English too, which creates a sense of familiarity for UK buyers, ” he explained.
The Cypriot property market still has some way to go before recovering from the country’s economic misfortune in recent years. However, now there is more legislation and incentive in place for overseas buyers in Cyprus, sales are picking up. According to figures from the Department of Land and Surveys , the number of property sales in Cyprus rose by 22% in July when compared with a year earlier. In Paphos, which is very popular among British buyers, the number of sales was 30% higher than in July 2014.
Article by +Roxanne James on behalf of Propertyshowrooms.com
read moreUS Property Market Strong despite Stock Market Chaos
According to American media reports, job growth is continuing to drive a strong recovery in the US housing market, with mortgage starts last week jumping 17% to their highest level since April.
Despite the downward spiral caused by Black Monday on 24th August, mortgage applications for the same week saw an uplift of 11.3% compared with the previous week, according to a Mortgage Bankers Association report released on Wednesday.
” You had some borrowers looking to refinance who really took advantage of the short availability of very low rates, ” Mike Fratantoni, the association’s chief economist, said. ” You had a number of people following the market very closely. “
Volatility triggered by China’s economic slowdown
The widespread volatility triggered by China’s economic slowdown led to moments of very low interest rates on 10-year US Treasury notes – a key benchmark for the mortgage-lending market. The Federal Reserve has been preparing to raise interest rates at ‘some point’ before the end of the year and the resulting uncertainty prompted home-buyers to seek finance ahead of the expected rate-hike during last week’s market mayhem.
However, economists maintain that growth in the US housing market is underpinned by consistently rising demand driven by increased affluence and improved affordability as the American economy strengthens. Fratantoni said: ” We do expect improvement in the housing market to continue. Job growth and declining unemployment rate and wage growth – those are really the factors that we focus on. “
The trend in existing home sales, accounting for 90% of the housing purchase market is also increasing. Danielle Hale, director of housing statistics at the National Association of Realtors (NRA) said, ” It’s one of the key numbers we pay attention to and we’ve seen eight-year highs in those numbers recently. “
According to the NRA properties are selling at a faster rate than last year, with homes selling in July 2015 typically spending 42 days on the market before closing, compared to 48 days in July 2014.
Dan Porter, owner of Chicago realtors Porter House Properties told International Business Times: ” All those people who have been renting or living with mom and dad are starting to hit the market. ”
The US housing recovery has been slow in the wake of the financial crisis as potential buyers retreated to the sidelines. ” That normal flow was interrupted for a few years, so it will take us a couple of years to get to what I would say is normal, although everything is going in the right direction, ” Porter added
Home sales reached 5.59 million
Last July, the annual rate for existing home sales reached 5.59 million in the US, the highest pace since the 5.79 million recorded in February 2007. An improving job market bodes particularly well for the housing market as more people find themselves able to afford to buy their own homes.
Banks more willing to lend money
” As the US economy improves, banks are also more willing to lend money to prospective buyers “, Matthew Pointon, a property economist at research firm Capital Economics, said. He cited data from US mortgage processors Ellie Mae showing the rise in loan applications that won approval as 71% of mortgage applications in July 2015, up from 62% for the same month last year.
“Banks are feeling more confident,” Pointon said. “They’re looking ahead and they’re seeing a strong economy. They’re seeing people’s incomes going up.” Current growth in the US housing market is underpinned by strong fundamentals, indicating a sustainable recovery is now in full-swing.
Article by +Roxanne James on behalf of Propertyshowrooms.com
read moreReal Estate Powering Egypt’s Economy in 2015
In the last few critical years of Egypt’s history, the growth of its economy has depended heavily on the development of the country’s real estate sector.
The real estate sector in Egypt is dynamic and reliable, serving as the backbone of the nation’s economy despite the political and economic setbacks endured in recent years. The value of real estate investments in Egypt has witnessed a sharp increase since 2001 – from €890m rising to €3.5bn by the end of 2012, representing a growth rate of 27.5%.
Labour markets in Egypt have been favourably assisted by buoyancy in the country’s property market. In 2012, the real estate sector absorbed as much as 14.9% of total employment, hiring an equivalent of 3.2 million people and in 2013 the sector contributed 8.3% to national GDP. Industry insiders have since adjusted their outlook for Egyptian real estate, projecting the sector to grow 70% from €6.3bn in 2012 to just over €10bn by 2020.
There are several factors attributed to the strength and importance of the real estate sector in Egypt. Firstly, it contributes to more than 90 industries related to construction. In fact, with the recent abundance of construction projects either currently underway or still pending final agreements, the building and construction sector is expected to attract investment of around €6.5bn in 2015 from both domestic and foreign investment, making it one of Egypt’s biggest revenue sources.
Additionally, the construction sector has driven continued expansion of related industries including metals, cement, furniture and power generation. Currently, the construction and development sector in Egypt makes up 20% of national GDP, rendering it one of the sectors most responsible for the economy’s increasing metabolism.
Demand for housing remains high at all income levels
In a country of more than 85 million people and some 800,000 marriages every year, demand for housing remains high at all income levels, say real estate companies and analysts. The country’s big listed developers tend to cater solely for the upper middle and upper classes, among whom demand has remained strong, as buyers have sought security in bricks and mortar during the economic uncertainty.
Each year Egypt not only requires more than half a million homes to meet the demands of new families, it must also continue to satisfy the existing housing deficit. Essentially with every year, the demand for houses and related infrastructure continues to exceed supply.
Improving tourism and rising visitor numbers in Egypt provide another demand-stream, with foreign investors seeking high value opportunities in the country’s many popular resorts. Ahmed Badrawi, Managing Director of SODIC , a leading private sector real estate development company said: ” You only have to look at the housing supply gap to get an idea of the potential within the real estate sector. The number of homes being brought to the market today barely scratches the surface of the hundreds of thousands of units needed on an annual basis “.
With a rapidly expanding young population – predicted to double over the next 25 years – the demand for amenities to compliment the expanding urbanisation is also putting pressure on various sectors, such as commercial and retail real estate. Already 27 new urban cities have been built around Egypt with plans to increase this number to a further 59 by the end of 2017.
Around 20% of projects currently under development in Egypt are allocated to office and retail space. Even in Cairo, there has traditionally been a dearth of property purpose-built for business, with most companies operating from converted residential space.
There are plenty of high value investment opportunities in both Egypt’s commercial and residential property markets and with a high level of consistent demand from domestic buyers, buy to let opportunities are becoming widely available, particularly in the suburbs of Cairo. As more financing and mortgage options become available in Egypt, its real estate sector has the potential to soar in the coming years.
Article by +Roxanne James on behalf of Propertyshowrooms.com
read moreBusiness Booms for Malaysia’s Hotel Sector
2014 was a good year for Malaysian tourism, attracting international brands like Kempinski, Four seasons, Fairmont, Ritz Carlton, Ibis and Hilton to Kuala Lumpur’s expanding market, with plans to commence operation in the capital over the next three to five years.
Visitor numbers throughout last year increased more than 10% to 18.4 million, despite the drop in tourists in reaction to the disappearance of Malaysian Airlines flight MH370 in March 2014. Malaysia ‘s government have pulled out all the stops to support investment in its hotel sector granting Investment Tax Allowance and Pioneer Status for new hotels with 4 and 5 star ratings. Hotels that are 100% foreign owned also qualify for these tax incentives, which is a big attraction for international hotel brands.
The government’s Malaysian Investment Development Authority (MIDA) has identified the country’s tourist sector as one of the 12 National Key Economic Areas (NKEAs,) set to attract investment in its private sector to drive the nation towards high-income status and global competitiveness.
The goal of Malaysia’s government is to push tourism by investing heavily in its infrastructure and providing attractive incentives to foreign hoteliers seeking to expand in Southeast Asia. The government’s Tourism Transformation Plan sets a target of 36 million tourist arrivals annually, contributing €36bn to the economy each year by 2020.
Latest hotel developments in Kuala Lumpur include a joint venture between Singapore developer Oxley Holdings and Dubai’s Jumeirah Group – the luxury hotel brand behind the Emirate’s iconic Palm Islands. The JV plans to operate a 190-room luxury Jumeirah hotel with a further 273 premium residences carrying the group’s brand in Malaysia’s most visited destination, it’s capital city – Kuala Lumpur.
Commenting on Oxley’s fifth luxury hotel in the region, chairman and chief executive Ching Chiat Kwong said: ” This partnership with Jumeirah Group further enlarges and reiterates our presence in the Malaysian market. ” He added that Oxley are seeking to launch more hotel developments in Malaysia, Cambodia and Indonesia as part of its strategy to expand its investment in property.
In terms of smaller-scale property investment in Malaysia, the strong dynamic in the country’s tourist sector in resort areas where there is significant and rising demand provides plenty of value growth opportunities, particularly in Kuala Lumpur.
Affordability remains a major issue for domestic buyers in Malaysia and sales volumes fell by around 8% year on year during 2014, while prices soared 72% over the same period of time. The country’s central bank, Bank Negara introduced cooling measures to curb rising household debt that stands at almost 87% of GDP, with loans for properties forming the bulk of household debt at around 47%.
With property prices at levels beyond the reach of many Malaysian nationals, foreign investment in the country’s private rental sector is on the rise. Apartment prices in Kuala Lumpur are reasonable at between €1,300-€2,600/m2 and value growth in the city has reached stability. The prime attraction for investors in the capital is rental income.
Gross rental yields in Kuala Lumpur have registered a decline over the past year, with rents not keeping pace with rising nominal prices. The highest value growth investment is in the 120m² apartment category which has recorded gross returns of between 7% and 8% over the last 12 months.
As major names in the international hotel business continue to construct and open luxury operations in Malaysia, demand for investment property in resort areas is set to increase significantly. With plenty of yield opportunities in both the country’s domestic private rental market and the tourist sector, there is plenty of scope for investment in Malaysia at the current time.
Article by +Roxanne James on behalf of Propertyshowrooms.com
read moreTourists Flock to Cape Verde 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 the first six months 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 United 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.
Despite the recent rise in visitor numbers, 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 over the years.
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
read moreMaltese Real Estate an ‘Opportunity Gateway’ for Ultra Rich
According to the findings of Wealth-X and Malta Sotheby’s International Realty , Malta is home to 35 Ultra-High-Net-Worth (UHNW) individuals worth around €145bn and two foreign billionaires.
Published last week, the report reveals that 77% of UHNW foreigners who have acquired a residency permit in Malta are self-made. One of Malta’s billionaire residents is Irish-born Denis O’Brien who owns Communicorp, a media holding company operating across Europe and he is listed among the World’s Top 200 Billionaires in 2015 .
To qualify as an UHNW individual, investable assets of at least €27bn are the benchmark, excluding personal assets and property such as a primary residence, collectibles and consumer durables. In February 2015, Malta Sotheby’s International announced its partnership with Wealth-X to provide valuable insights into today’s luxury real estate market and the buying behaviour of the ultra-wealthy consumer.
Malta is among the world’s smallest nations, with a rich history and culture that has been a strong pull for UHNW residents for many years. The country boasts a warm subtropical climate, stunning cliff views of the Mediterranean and numerous UNESCO world heritage sites.
Malta is a rich tapestry of cultures and traditions
Formed by its many historical rulers and influences, Malta is a rich tapestry of cultures and traditions, with classical and contemporary homes scattered throughout the island. Several new seafront complexes offer the range of modern luxury amenities while many older homes are prized for their unique architectural detail.
Foreign nationals are allowed to buy one property anywhere in Malta though in specially designated regions they may purchase additional properties. Several new and exclusive penthouse developments and the luxurious resort ‘Three Villages’ located in Sliema on the east coast are particularly attractive to foreign investors
France, Germany and the US are the top countries for foreign UHNW investments in Maltese property where the average listed price for homes over €1m is around €2.5m, while the median price per square metre is around €6,500 in that price range.
Good long term investment opportunities
The report’s findings show that Malta offers good long term investment opportunities. During 2014, market volatility in certain nations, particularly China, has led wealthy property buyers to seek homes in economically and politically stable locations like Malta, as a hedge against market instability at home. The report states that ‘Malta’s citizenship programme enhances the island’s position as an attractive location for investment, especially as the EU is the most significant region of citizen application’.
Global citizenship is becoming an increasingly popular tool for the world’s ultra-wealthy and Malta’s citizenship programme enables foreign nationals to purchase a property anywhere across the island, although more than one property situated within Special Designated Areas (SDAs) can be bought. Most of the islands luxury lifestyle developments are located in prime, highly sought-after locations in the island’s commerce, leisure and activity hubs.
Wealth-X President David Friedman commented: ” Wealth-X is pleased to partner with Sotheby’s International Realty brand for this third luxury real estate report for 2015. This new joint study explores the trend and home-buying motivations of a distinct group of ultra-wealthy individuals in the emerging markets. As their wealth grows, so will their investment fuelled by various motivations, be it to diversify their portfolio or to gain citizenship or residency in a foreign country “.
According to Philip White, president and chief executive officer of Sotheby’s International Realty Affiliates, the joint report provides an understanding of the trends driving buying decisions of the ultra-rich around the world. ” The research reveals trends that go beyond traditional motivations and help guide real estate investments that contribute to long-term wealth “, he said. ” It underscores the important role real estate plays in a larger strategy to build a valuable asset portfolio “.
Article by +Roxanne James on behalf of Propertyshowrooms.com
read moreSpecialist Property Investment Soars in the UK
As real estate investors seek to diversify within the asset class, specialist property investment has become the next big thing and nowhere more so than the UK.
According to Knight Frank’s recently published Specialist Property, The Core Markets report, investment in alternative British property assets including student accommodation and hotels has become a critical component of investors’ core portfolios.
Darren Yates, partner of Knight Frank’s commercial research said: ” Based on our in-house forecasts, Knight Frank estimates that investment in the core specialist property sectors will break through the £10bn barrier in 2015 “.
The amount of capital being poured into property has done more than drive down yields, according to Knight Frank; the difficulty of securing traditional investments and the drive for diversification has put specialist sectors including automotive, property, healthcare, hotels and student property very much into the spotlight.
As a result of increased demand for specialist property investments, the UK is set to achieve a record year, with transaction volumes likely to reach £12bn by the end of this year. Knight Frank report that the number of deals in the pipeline with completions expected by the end of the year means their original forecast is likely to be exceeded by a significant margin.
In the first six months of the year, transaction volumes for student property reached £3.5bn and are expected to exceed £5bn for the full year. With a shortage of good quality assets, prime yields have been prompted to harden to 4.5%, with increasing pressure on pricing for secondary stock.
The hotel sector has been notably buoyant among the range of specialist property assets, with investments attracting significant attention and equity. Again, this sector is affected by the supply demand imbalance that exists in the market which could potentially lead to further yield compression.
” Specialist property is attractive to many investors and there are a number of common threads across the various sub-sectors, not least the strong alignment with residential, the opportunity to diversify away from traditional property and the occupier-driven nature of the sector. However, the key reason why we are seeing such an exceptional level of investor interest is the structural under-supply of high quality, purpose-built accommodation. This is supported by buoyant demand from increasingly discerning occupiers, ” said Shaun Roy partner of specialist property investment at Knight Frank.
The specialist property market continues to evolve as a segment in its own right, led by fixed income sectors such as hotels, healthcare and retirement accommodation but also encompassing automotive, student property and even private rented sector (PRS) residential accommodation. Nevertheless, fixed income transactions account for a small portion of the total specialist market.
Investor appetite for specialist property is growing in the UK amid an accelerating economic recovery that has broadened out around the country. There is underlying support for specialist investments from a combination of improving occupier demand, easier to access finance, a broader understanding of operators’ businesses and a willingness to take on greater risk.
Knight Frank say it seems inevitable that investors will move further up the risk curve in search of returns, increasing their operational exposure to these markets through turnover-related leases, direct let and management contracts.
As with other emerging property sectors over the years, yields on alternative assets historically start at a high level and harden as investor interest increases and some sectors have become more accessible in the process. As a result of the growth in capital values in recent years, many early entrants to the specialist property market have reaped significant rewards.
Article by +Roxanne James on behalf of Propertyshowrooms.com
read moreBillionaire Soros sells most of Alibaba, reduces oil stocks
NEW YORK, Aug 15 — Billionaire George Soros’s family office sold almost all of its stake in Alibaba Group Holding Ltd in the second quarter, as Asia’s largest Internet company saw its stock decline further because of a slowing Chinese economy….
read moreKL shares likely caught in down trend
KUALA LUMPUR, Aug 15 — Bursa Malaysia is expected to extend its downward momentum next week, in line with regional peers on the back of multi-year low Asian currencies, China-Japan currency war and the impending US rate hike.
Affin Hwang…
read moreCautious trade on ringgit next week
KUALA LUMPUR, Aug 15 — The ringgit is likely to experience cautious trading next week, amid the uncertain global sentiment, said a trader.
“Emerging Asian currencies are expected to continue to be affected by external factors such as the…
read moreKLCI futures to trend lower
KUALA LUMPUR, Aug 15 — The FTSE Bursa Malaysia KLCI (FBM KLCI) futures contracts (FKLI) on Bursa Malaysia Derivatives are expected to trend lower next week.
Affin Hwang Investment Bank Vice-President and Head of Retail Research Datuk Dr Nazri…
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