Worldwide chomp sparks accommodation cost waterfall in each state - Bay Era
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Worldwide chomp sparks company penalty waterfall in each countrysideBay Era, QatarA be short of of bureaucrat information income it is not possible to say how a lot of are at danger, but investigate company Mintel says, for instance, at smallest amount 800000 Britons owned homes abroad in 2006. The majority UK genuine land agents by means of abroad teams confess confidentially so as to sales ... |
Worldwide chomp sparks company penalty waterfall in each people - Bay Era
Gulf Times – Qatar’s top-selling English daily newspaper - OpinionBy Graham Norwood A ‘for sale’ sign outside a foreclosed home in North Las Vegas, Nevada, in the US. Home prices in Las Vegas fell by 33% compared to the same period last year, according to the Standard & Poors/Case-Shiller index for the fourth quarter of 2008LONDON: This time last year, Chandra Gosavi’s property portfolio looked like an A to Z of shrewd investment. The doctor from Leicester, England, has two homes in Bulgaria bought for a total of EUR118,000 (£105,310), two in Egypt costing EUR100,000 (about £89,200) and one in northern Cyprus bought in sterling for £70,000. He has also bought in Mumbai and owns land in Alicante, Spain, where he plans to build his own property. Bulgaria had just joined the EU, there was a possible reunification of Cyprus, and Egypt was maturing as a major tourist destination. Those factors will all boost values, surely? But neither he, nor most other purchasers buying abroad, expected a global downturn to spark house price falls in almost every country in the world. Today his properties have dropped in value by tens of thousands of pounds Sterling and his investment perspective has had to move to the long term. That way, if one market hits trouble, I don’t lose too much. I remain convinced this is a better approach than, say, spending £500,000 on one place in France,” says Chandra. He and his wife Rashmi, also a doctor, say some of their homes will be for their personal use and they do not intend to sell any for up to 15 years from now, by which time they believe the markets will have more than recouped any current losses. With the current market, I am obliged to think long term, not short term,” he says. Prices in Black Sea resorts and ski towns such as Bansko and Pamporovo have seen 20% falls since the autumn. As Nick Barnes, head of overseas research at UK real estate agent Knight Frank, says: “The market in these places is based wholly on foreign investors. Bulgarians aren’t buying, so when there’s a global credit crunch the market disappears and prices fall.” It is no better in other markets popular with outside investors. Construction of holiday homes in Cyprus is “at a standstill”, says Barnes, because of too many unsold apartments and villas. Meanwhile, prices are falling in India, too, where the country’s largest listed house builder, DLF, this month reported a 69% slump in profit and 59% drop in revenue. Business journal Asia Money says the Indian housing market is “primed for a bloodbath”. The Gosavis’ short-term situation reflects the reality that those who borrowed heavily to invest in foreign bricks and mortar at the top of the market are now faced with substantial negative equity. A lack of official data means it is impossible to say how many are at risk, but research firm Mintel says, for example, at least 800,000 Britons owned homes overseas in 2006. Most UK real estate agents with overseas teams admit privately that sales since then have dropped 60% to 75%, so the figure is unlikely to have increased significantly. Yet those who are brave enough to buy now - and have sufficient cash to do so - can find remarkable bargains. Panicky developers and agents are offering unusual deals to compensate for the credit crunch and weakness of the pound. Oceanico Group is offering a “no payment for 12 months” deal on flats at a golf resort on the Algarve, in return for a £10,000 deposit and a pledge to buy in 2010. In Mallorca, British developer Greenside has frozen the pound-euro exchange rate at a late 2007 level for those buying some of its villas, to counteract what it calls “bad luck for British buyers beyond their control”. In the Turkish tourist resort of Bodrum, selected villas marketed by real estate agent Nirvana International are down from £200,000 to £120,000. It is also giving away a car to the buyers of flats in a nearby development. Top-end agent Aylesford International is selling Casa Cigala, a villa on Ibiza, for EUR1.8mn after failing to find a buyer since 2007 at its original EUR2.6mn. In Italy a Tuscan villa overlooking Lake Montedoglio has been on sale for over a year at EUR3.2mn; now real estate agents Savills has slashed it to EUR2.2mn. But the biggest falls are in main land Spain, where many sellers have reduced prices by more than 30%. However, according to Knight Frank’s Nick Barnes, “there’s not the slightest sign we’re even remotely near the bottom of the market,” suggesting that ballsy buyers can negotiate even lower prices if they have the guts to bargain. Developer Taylor Woodrow is offering 36%-plus discounts on flats at El Bosque de la on the Costa del Sol - they were EUR271,000 and are now EUR173,000. On the Costa de la Luz, “discounts of 30-40%, previously unheard of, are achievable”, admits Andrew Benitz of Titan Properties. But those who want to buy in Spain or other falling markets are finding mortgages difficult to obtain. Funding anything on a big Spanish development is hard, as flats will be downvalued.” Mortgage availability for Dubai has plummeted too, she says, confirming signals from selling agents that prices have fallen 10% to 40% since the new year. You can’t get a mortgage on a flat there,” says Nessling. They are also hard to get in the US, with 50% maximum LTV. On the other hand lenders’ policies towards those buying in long-standing favourites such as France, Italy and Portugal remain broadly unchanged - and, of course, at highly competitive rates. So are these countries still safe to buy in? Home prices in Las Vegas fell by 33% compared to the same period last year, according to the Standard & Poors/Case-Shiller index for the fourth quarter of 2008LONDON: This time last year, Chandra Gosavi’s property portfolio looked like an A to Z of shrewd investment. Bulgarians aren’t buying, so when there’s a global credit crunch the market disappears and prices fall.” It is no better in other markets popular with outside investors. Сватба
