10 | INDUSTRY
NEWS IN BRIEF Moscow best for demand
NEWS By Geoff Hadwick
Moscow has overtaken London as the city with the best real estate demand prospects according to Jones Lang La Salle. In the company’s annual ‘European Regional Economic Growth Index’ (E-REGI), JLL says that fresh concerns over western Europe and a reversal of last year’s gains in GDP and employment rates in London has seen the UK capital slip behind the Russian capital in the rankings of Europe’s most attractive cities for real estate investment. Moscow’s lead is based on growth potential, whereas London’s wealth and business environment scores still far outstrip it.
Prime market slowdown
The global prime property market recorded its lowest annual growth fi gures for over two years according to Knight Frank’s latest Prime Global Cities Index. Luxury property prices increased by 4.3% in the year to September 2011. Coupled with the increase of just 0.5% in the third quarter this is the smallest rise since the second quarter of 2009. “There are now clear signs however that luxury property prices around the world are collectively softening for the fi rst time since the global recession hit in 2008/09,” said the report.
RSA back on the radar
South Africa is attracting more overseas property buyers as the Rand becomes devalued against other currencies. Berry Everitt, managing director of the Chas Everitt International property group, said: “The value of the rand has shown a sharp decline that was bound to catch the attention of overseas investors, especially in the light of the economic distress in Europe.” Everitt added that nearly 30% of his enquiries are now coming from abroad.
CYRPUS CUTS FEES
Cypriot MPs have unanimously voted in the House of Representatives this month to abolish or reduce its official Property Transfer Fees (PTFs) for six months. PTF’s will should also be halved for those who don’t pay house VAT, they added.
The deepening crisis in the global economy, “tightening measures” by banks and governments and government cooling measures in China are all combining to pull down the Asian luxury residential market says a new report out this week from global agency CBRE. “Buyers of luxury residential
property in Asia turned more cautious in the third quarter of this year,” CBRE told OPP, “under the impact of the faltering recovery in the United States, the deepening EuroZone debt crisis and property cooling measures implemented by various governments across the Asian region.” “Transaction volumes in all markets recorded a signifi cant decline year-on- year in Q3 with homes sales in Hong Kong slumping to the lowest levels recorded since 2009.” Capital values are falling for the fi rst
time in three years, with the CBRE Asia Luxury Residential Property Index down 0.2% quarter-on-quarter. “Value growth in Beijing and
www.opp.org.uk | DECEMBER 2011 Asia luxury market collapses
Slumping | sales, caused by Eurozone trouble, have aff ected Asia’s luxury market
Guangzhou moderated as developers sought to unload unsold inventory at greater discounts. Prices in the Hong Kong and Singapore luxury markets witnessed declines of 0.8% and 1.8% quarter-on-quarter respectively due to weaker investor sentiment and rising mortgage rates,” CBRE reported. Rental growth rates are slowing too,
down to 1% versus 1.5% in the previous quarter, says CBRE, and, despite a
surging 5.3% rental yield growth rate in Beijing, South East Asia as a whole faces “weakening rental growth rates as multinationals cut back on hiring, which will affect the fl ow of expatriates to the region.” The fourth quarter is going to see transactions volumes and values “soften,” CBRE told OPP, “as developers in China offer prices discounts and launch cheaper units.”
SIPP providers facing crackdown
SIPP providers who deal in complex assets have been warned by the UK’s Financial Services Authority (FSA) that they could face greater due- diligence requirements. Peter Smith, head of investment
policy at the FSA, said that SIPP- providers might have to re-align due- diligence levels to accord with the assets within their SIPPs. “I think the SIPP operator has
choices to make about the assets they will administer within the SIPPs they
MALAYSIA SOFTENS
The Malaysian luxury market is starting to go soft say local agents as demand levels off and the global economic situation worsens. Buyers are also being put off by tighter credit policies at the banks, DTZ Research announced this week .
are running,” Smith said. And, he added, “their choice should be based upon some assessment of what is sensible for the customer base they are dealing with. I think they need to think through what that implies for them in terms of due diligence.” “SIPP providers need to ask what
service they are going to offer. If I have to wind myself down as a SIPP and I have been operating purely in the esoteric end of the market then what does that mean for the people
US PRICE TROUBLE
US home prices are continuing to struggle after the latest CoreLogic index revealed a second consecutive set of price declines. Its September report showed national home prices fell by 4.1% year-on-year following the 4.4% decline in August.
whose pensions I am holding?” Smith told OPP this month. He also added that the FSA is seeking to outline clearer guides on the amount of due diligence SIPP providers are expected to undertake on investments. “It’s not obvious to me that starting
from the position of ‘any asset is OK so long as you want to buy it’, is a sensible position to be in from a SIPP operator’s perspective. The SIPP provider should have thought through what kind of assets they want to administer.”
PHILIPPINo LEVY
The Philippino Bureau of Internal Revenue (BIR) has upped its VAT thresholds on residential land and property transactions. It has gone up from PP1.5 million to P1,919,500 and from P2.5 million to P3,199,200 for a plot with a house built on it.
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