10 | INDUSTRY
NEWS By Geoff Hadwick
REUTERS has revealed the numbers behind the Bank of Spain’s much- vaunted campaign to assess how much property exposure is wrapped up in the country’s 17 remaining regional savings banks ... or ‘cajas.’ Reuters understands that most of the
banks have reported now bar the two smallest cajas … Caja Ontinyent and Caixa Pollensa … both of which were still due to complete the exercise as OPP went to press. The main results are included in
OPP’s special feature on distressed markets, which starts on page 44. They list fi gures for the banks positions at the end of 2010 for “exposure to real estate loans”, which refers to developers and real estate business, not to mortgage lending and “risky loans”, which are defi ned as “currently sound loans at risk of default.” So, for instance, the Banco Financiero y de Ahorros, has total assets of €328,099,000,000, equivalent to 11.1% of Spain’s entire banking system. And €41,280,000,000 of its total loan book of €214,799,000,000
www.opp.org.uk |MARCH 2011 Spanish banks reveal loan exposure
and other complications. The number of British buyers has slumped. According to government fi gures, at least 100,000 homes built around the coast during the last decade face unresolved planning problems. “The British are our highest priority
and are those about whom we are most concerned,” Corredor said. “It is true that there has been... an image problem. Now we want to reassure the British, and all foreigners, that we are doing everything possible to put the details clearly on the table.” A law change will obligate the
Out of pocket | Spain’s savings banks have revealed their exposure to bad loans
(just under 20%) has been classifi ed as the total value of its exposure to property developers and real estate businesses in general. The release of these fi gures coincided
with a statement from the Spanish housing secretary Beatriz Corredor, the opening salvo in a growing government campaign to reassure frightened buyers and to promise new planning laws that will end the confusion over properties deemed to have been illegally built. “Come here calmly, and
trust in the system that we have and the transparency we provide,” she told UK newspaper the Sunday Telegraph. “There is a very attractive offer on the table here, with prices signifi cantly lower than two years ago, and you will certainly fi nd what you are looking for.” Corredor is trying to soothe nerves in the UK. In recent years, Britons have bought one third of all Spanish properties sold to foreigners. But many have recently been put off by horror stories of planning permission being retrospectively revoked
local council to provide a document for each property being sold stating clearly its boundaries, the category of land on which it stands, its access to services including water and electricity, and details of its planning approval. If someone buys a house with all
the correct paperwork they could be assured of its legality said Corredor. The Spanish government has also embarked on a “roadshow” around Britain and other northern European countries to promote the country’s property market.
UK market to improve Target Asian investors
UK-based estate agency group Fine & Country predicts that the British housing market will improve in Q3 2011 and “maintain momentum into 2012” for the prime sector. The “mainstream market will remain challenging throughout next year followed by a gradual improvement during 2012.” Fine & Country chief operating offi cer
Mike Bidwell told OPP that, after several months of canvassing the opinion of his managers in the company’s network of 300 locations worldwide, the “recovery will take place quicker in the south of England rather than the north even though there are hot spots and cold spots in both halves of the country.” Bidwell believes that “there is a pent-up
demand across the UK market with sales volumes having dropped dramatically over each of the last three years. It could be estimated that there are as many as 2,000,000 people who have not moved during this period that otherwise might have done so were it not for the adverse
economic conditions.” Many “homeowners are seeing light at the end of the tunnel,” he says, and they are “getting ready to make moves that have been on hold over the past two or three years.” However, adds Bidwell, for the “fi rst-
time buyer, the outlook remains tough with attractive mortgage deals remaining hard to obtain.” He expects UK “interest rates to remain low making property more affordable to those who can fund the deposit required to get into the market ... and responsible mortgage lending will increase once the economy shows signs of consistent recovery.”
GARRETT KENNY, chief executive of Florida-based Coldwell Banker Feltrim, has signed his business up as the latest international property company to join the newly-formed Fortune Real Estate Group. Fortune RE has been set up by
Steve Dawkins and Rob Bradley of Own Property Worldwide; George Betz of Worldwide Shows and Events; Xavier Wiggins of RGG Ltd; and a network of strategic partners in Asia to help developers and agents like C B Feltrim sell and market overseas properties to buyers in the Far East. The new consultancy service
UK prices | will recover from pounding
offi cially opens its doors for business in March. “Fortune RE is a very exciting and a very timely launch,” says Kenny. “It is designed to help developers like me gain access to wealthy buyers from places like Shanghai, Hong Kong or Singapore.”
Fortune RE’s Steve Dawkins agrees, adding “no-one needs telling about the power and reach of the Asian market at the moment.” “It’s not a question of the size of
the market.” Dawkins adds. “It is much more about finding the right buyers. It can be difficult trying to locate who is ready to buy and what they are looking for. How do you distinguish between the investor and the lifestyle buyer in Asia? What sort of properties do they like and why? How do they prefer to pay … and so on? Fortune RE can help you find the answers.” As part of Fortune RE’s offering
to its clients, a range of new services has been developed to help overseas property providers grow their presence in the Asian marketplace. If you would like more information
on Fortune RE and what it is doing, please go to
www.fortuneregroup.com
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