New Zealand to enhance home construction through regulatory changes
New Zealand's government plans regulatory changes to increase home construction, set housing growth targets, enable urban expansion, and promote development around transport routes. Despite a drop from 2021 peak prices, housing affordability remains low, making it a key political issue. Housing Minister Chris Bishop attributes high costs to restrictive regulations. The new measures will support mixed-use developments and abolish apartment size restrictions. The opposition Labour Party supports increasing housing but raises concerns about building standards and agricultural land loss. The government aims to balance housing supply growth with quality and environmental sustainability to improve affordability and boost the economy....
SBB debt swap raises concerns about Swedish Property market's USD 56 billion debt burden
Sweden's property market faces upheaval as Standard & Poor's downgrades SBB, a key player with a USD 56 billion debt, to 'selective default.' SBB, once pivotal in Sweden's property boom, grapples with soaring borrowing costs and market slowdowns. Its recent debt restructuring, offering creditors new bonds at a steep discount, triggered S&P's downgrade. This move underscores broader concerns about the market's stability amid inflation and rising interest rates. With SBB's fate uncertain, the incident raises alarms over Swedish economic health, impacting construction, employment, and investor confidence. Observers await how SBB navigates its massive debt burden and its implications for the broader economy....
Norway blocks sale of strategic Svalbard land to prevent Chinese acquisition
The Norwegian government halted a plan to sell the last privately owned land on Svalbard to prevent its purchase by China. The 60 square kilometres of remote land, priced at 300 million euros, lies in a strategic Arctic region between Norway and the North Pole. Governed by a unique legal framework, Svalbard allows foreign entities to operate there. The property's seller, a company owned by a Russian-born Norwegian, has received interest from Chinese buyers. Critics doubt the sale's feasibility due to the land's lack of infrastructure and commercial value. In 2016, Norway bought another private Svalbard property eyed by China....
Toronto home sales rebound in June as interest rates drop
Toronto's real estate market showed signs of recovery in June, with home sales rising 4.2% after four months of decline. This follows Canada's first interest rate cut in over four years. Average home prices increased marginally to CAD 1.13 million, while new listings jumped 9.3%. Despite these improvements, year-over-year figures still show decreases in sales and prices. The Bank of Canada's rate cut to 4.75% likely influenced this shift, with markets anticipating further easing. TRREB's chief analyst describes the market as well-supplied, benefiting recent buyers with more choice and negotiating power. The combination of lower borrowing costs and high inventory is expected to balance the market moving forward....
USA mortgage rates rose for the first time since May to 6.95%
The average rate on a 30-year mortgage rose to 6.95% this week, the first increase since late May, adding to borrowing costs and exacerbating the ongoing slump in home sales since 2022. Borrowing costs for 15-year fixed-rate mortgages also rose. Mortgage rates, influenced by the Fed's policy and the 10-year Treasury yield, have fluctuated around 7% this year. While the Fed signals a potential rate cut by year's end, analysts expect mortgage rates to remain above 6%. Despite declining sales, home prices hit a record high in May. Elevated rates and prices continue to deter many potential buyers....
UK election boosts opportunities for Indian construction workers with promise to build 300,000 homes annually
The recent UK election, resulting in a Labour Party victory and Sir Keir Starmer becoming Prime Minister, could significantly benefit migrant Indian construction workers. A note from London-based Immigration Advisory legal firm A Y & J Solicitors highlights that fulfilling the promise to build 300,000 homes annually will increase demand for skilled construction workers. The note reviews the UK's current immigration policies and the potential for changes under the new government, emphasising the construction industry's reliance on overseas workers due to a domestic skills shortage. This scenario presents a promising opportunity for skilled Indian construction workers seeking better prospects in the UK....
UK housing market shifts to slower growth amid rising interest rates
The British housing market is experiencing a phase of slower growth, with prices increasing by just 0.2% in June 2024, as reported by Nationwide. Despite a 1.5% year-on-year rise, prices are still 3% below their peak. Higher interest rates, driven by the Bank of England, are making mortgages costlier, affecting affordability. Projections indicate a modest 1.8% price increase for 2024. The Labour Party proposes easing planning rules to boost construction and address affordability concerns. As the market stabilises, buyers may find more opportunities, while sellers face a less frenzied but still resilient market....
Hong Kong property stocks rise as data shows narrowing sales decline for Chinese developers
Hong Kong property stocks surged as private data revealed a narrowing decline in year-on-year sales for major Chinese developers in June. The Hang Seng Mainland Properties Index rose 3.5% by midday, driven by gains in companies like Longfor Group and Shimao Group. This comes after a multi-trillion yuan government support package aimed at stabilising the property sector. Data showed a 36.3% month-to-month sales increase among China's top 100 developers. CRIC predicts further improvement, with more home purchases expected in July. However, the long-term impact of the support package and the performance of smaller developers remain uncertain....
Japan's land prices rise 2.3 percent in 2023 driven by tourism recovery
Land prices in Japan grew by 2.3% in 2023, the highest rate of growth since 2010, according to a National Tax Agency poll. After 2.5% growth in 2022 and a 0.5% increase in 2021, this year's increase in prices was the third in a row. Out of 47 prefectures, 29 saw an increase in land prices, including Tokyo, Hokkaido, and Okinawa. The largest rise, 5.8%, was recorded in Fukuoka Prefecture due to reconstruction and a rebound in tourism. Ginza in Tokyo continues to be the most expensive place in Japan. The study reveals strong demand, supported by a rebound in tourism and a depreciating yen, for both residential and commercial land....
Singapore is enhancing its public housing for inclusivity and accessibility, balancing homebuyers' aspirations with community goals. In 2023, the market saw a significant new supply, with 21,400 HDB flats and 20,400 units from private developers. GLS tenders are expected to yield 9,250 residential units, a decade-high record. The steady supply aims to stabilise the market, with HDB resale demand driven by private homeowners downgrading. In Q1 2024, 185 resale flats sold for at least SGD 1 million. New BTO classifications - Standard, Plus, and Prime - launching in H2 2024, and policy changes benefit singles, reflecting efforts to make housing more inclusive and affordable....
Vacation rentals in Hawaii account for nearly 6% of the housing supply
Despite regulatory efforts, vacation rentals remain a significant part of Hawaii's housing stock. Converting these rentals to long-term housing is seen as a solution to the critical housing demand, but new short-term listings continue to rise. The Hawaii Housing Factbook 2024 reports 32,000 short-term rentals, making up nearly 6% of the state's housing. Efforts to regulate have not significantly shifted the market. Maui is the only county with a bill to amortise vacation rentals. Effective policy implementation and cooperation between stakeholders are essential to balance residents' housing needs and the tourism economy for a sustainable housing market....
Parcl Labs study warns of potential price correction in Florida housing market
A recent study by Parcl Labs raises concerns about a possible price correction in Florida's housing market, driven by an imbalance between supply and demand. Analysing data from 1,000 U.S. housing markets, the study identifies thirteen of the top fifteen markets at risk for price drops are in Florida. Cities like Pensacola and North Port have seen significant increases in new listings (+52% and +50%, respectively) alongside decreases in buyer demand, signalling a potential softening in home prices. Price cuts are also on the rise across Florida, suggesting shifting market dynamics post-pandemic. As market conditions evolve, both buyers and sellers should monitor these trends closely....
Singapore's private home prices show signs of cooling with 1.1% rise in Q2 2024
Singapore's private home prices increased by just 1.1% in Q2 2024, down from 1.4% and 2.8% in the previous quarters, reflecting a cooling market. The first half of 2024 saw a total price rise of 2.5%, lower than the 3.1% in H1 2023 and 4.2% in H1 2022. Landed properties drove the increase with a 1.8% rise, while city fringe areas saw 2.2% growth. Resale transactions hit 3,344 units in Q2, up from 3,066 in Q1. Analysts predict a 1-5% price growth for 2024, with revised new home sales estimates of 5,500-7,000 units....
Capgemini to launch new 6000,000 sq ft facility in Chennai
Capgemini is set to launch a new facility in Chennai, investing INR 1,000 Crores over three years. The six lakh square feet campus, housing around 5,000 seats, aims for completion by 2027. It will feature high-tech equipment as well as recreational amenities to enhance employee wellbeing and create a dynamic work environment. Sustainability is a key focus, with efficient technology and environment friendly practices. Tamil Nadu's Industries Minister supports the project, which aligns with the state's economic goals. Capgemini has also pledged INR 3 crores for local school improvements, highlighting its commitment to local talent and community welfare....
London Boroughs dominate England's most active housing markets with high turnover rates
New research by YOPA reveals a striking trend in England's housing market. The East of England tops the list for overall sales volume, with nearly 3.9 million homes sold over the past five years. However, London boroughs lead in market activity by turnover rate. Tower Hamlets shows a 43.1% turnover rate, with Hackney, Lambeth, and Wandsworth following. Norwich stands out outside the capital with a 31.2% turnover rate. This study highlights the significant local variations in market activity, crucial for homeowners and buyers understanding property values and making informed decisions....
US homebuilders face challenges amid slowing sales and high mortgage rates
Amid a rebound for some, US housing sales declined notably in April and May compared to the previous year. High mortgage rates are detering homebuyers, contributing to a third consecutive monthly drop in existing home sales by May. Builders responded by slowing new construction, especially of single-family homes and home prices saw a slight dip, with median new home prices going down in May. Despite financial incentives, uncertainty over mortgage rates led to buyer hesitancy. Cash buyers or those unaffected by rates faced less competition. Lisa Sturtevant forecasts a sluggish third quarter due to increased housing inventory and reduced demand....
Chinese property developer faces legal action over USD 613 million loan default
A Singapore-based fund, Seatown Private Credit Master Fund, has filed a winding-up petition against R&F Properties' unit, Trillion Glory, in Hong Kong's court. The petition alleges non-repayment of a substantial loan, highlighting financial strain within the company. This legal action mirrors similar challenges in China's property sector, raising concerns about developers' ability to meet financial obligations. With the case set for September 25th, 2024, its outcome could impact R&F Properties and broader market stability, given the sector's pivotal role in China's economy. Investors and analysts await developments, mindful of potential implications for the country's economic landscape....
Cinven acquire majority stake in Idealista for EUR 2.9 billion
Cinven, a global private equity firm, alongside EQT and other investors, has acquired a 70% stake in Idealista, a leading Spanish real estate firm, in a deal worth 2.9 billion euros (about USD 3.10 billion). Established in 2000, Idealista operates in Spain, Portugal, and Italy, offering real estate agents a platform to list properties through subscriptions. It provides online advertising, mortgage brokerage, and data analytics services. EQT retains 18% ownership post-deal, with Oakley and Apax selling their shares. Founder Jesus Encinar remains chairman. EQT previously acquired a majority stake in 2020, valuing Idealista at around 1.3 billion euros....
Kenya struggles with affordable housing crisis as urban population grows
Kenya is experiencing a significant shortage of affordable housing due to its rapidly growing urban population. As more people begin to move to cities in search of better opportunities, the growing demand for housing has increased sharply. Unfortunately, the supply of affordable homes has not kept pace with this demand. Many urban residents now face high rental costs and overcrowded living conditions. The government and private sector are trying to address this issue by planning and developing new housing projects. However, the need for affordable housing remains urgent, highlighting a major new challenge for Kenya's urban development and planning efforts....
Sweden's SBB creditors swap debt for USD 158 million in residential bonds
SBB is at the heart of a Swedish property market bubble that first began to burst in 2022. Rising inflation and interest rates led to significant drops in the company's credit ratings and a steep decline in its share price evaluations. This alarming situation has caused considerable financial strain on SBB, reflecting some of the broader challenges in the Swedish property sector. As a result, SBB's creditors have exchanged debt for residential bonds worth $158 million to mitigate risks and stabilize the situation. This move reflects the ongoing volatility and adjustments within the market as it grapples with economic pressures....
New Zealand reveals reforms to tackle housing shortage with 3-pronged approach
New Zealand is tackling its housing shortage with a comprehensive plan to streamline regulations, reduce construction costs, and increase affordable housing supply. With a significant housing shortfall exacerbated by a growing population, the government aims to create a more equitable market. Key measures include simplifying the building consent process, incentivizing developers to build cost-effective housing, and prioritizing sustainability. This initiative, highlighted by the national median house price reaching NZD 1,044,000 (USD 724,320), aims to ease market pressure, lower property prices, and stimulate economic growth through increased construction activity....
Dubai rent growth expected to slow as new apartments hit the market
After a substantial 21.1% increase in rents in 2024, Dubai's rental market may see a slowdown as more properties become available. Renewals have increased by 12.2%, indicating tenant preference for stable pricing. New registrations have slightly dipped by 3.7%, reflecting constrained supply. Despite continued high rents in prime locations like Palm Jumeirah and Al Barari, where averages reach AED 272,867 and AED 1,391,242 annually, respectively, more affordable areas could see easing rental pressures. With new developments entering the market, experts anticipate a shift towards single-digit rent increases, offering potential relief to tenants amidst Dubai's evolving rental landscape....
China's property market sees modest 0.15% rise in new home prices amidst 41.6% sales decline
China's property sector faces a severe liquidity crisis with widespread debt defaults since 2021. Despite government interventions such as reduced down-payments and flexible mortgage rates, new home prices rose modestly by 0.15% in June. The top 100 developers witnessed a significant 41.6% decline in new home sales value from January to June compared to last year, indicating persistent weak demand. Second-hand home prices also fell by 0.73% in June. Data from the China Index Academy highlights ongoing market fragility, showing the challenge of government measures in stabilising the sector amid economic pressures....
Summer-Ready Apartments: How Dubai landlords can beat the summer vacancy challenge
Dubai's summer heat poses a challenge for landlords, but a tenant-focused approach can ensure consistent occupancy. Key strategies include prioritising apartments near public transport, maintaining quiet surroundings, and offering in-building gyms. Fully furnished units with efficient air conditioning and regular pest control are essential. Interior design improvements, such as pops of color and modern, space-saving furniture, enhance appeal. Colife, a Dubai-based property management company, suggests that apartments meeting these criteria can command 15% higher rents. By understanding tenant preferences, landlords can keep their properties occupied and profitable during the summer....
Climate change impacts home values in Australia and New Zealand
Climate change poses a stark reality for homeowners in Australia and New Zealand, where coastal and bushland properties face escalating risks. Rising sea levels, frequent flooding, and intensified bushfires threaten the value and insurability of millions of homes. In New Zealand, 20% of houses sit on floodplains, highlighting widespread vulnerability. Meanwhile, in Australia, climate risks could erase AUD 800 billion from the housing market by 2030. Insurance premiums are soaring, with predictions that 1 million homes in Australia could be uninsurable by the same year. Future buyers must prioritize location resilience, while governments and insurers must strategize to safeguard homeownership from climate-induced financial peril....
U.S. housing market cools as construction spending falls 0.1% in May
The U.S. housing market shows signs of cooling as construction spending dipped by 0.1% in May, with single-family homebuilding seeing the largest decline at 0.7%. Rising mortgage rates have made home buying more expensive, contributing to this slowdown. The Commerce Department's report indicates a shift from the robust growth seen earlier this year, driven by increased housing supply and the largest inventory of previously owned homes since August 2022. While public construction projects and non-residential structures show mixed trends, the overall slowdown may offer some relief to potential buyers priced out in recent years....
Dar Global to launch $300 million luxury housing projects across US cities
Saudi property developer Dar Global intends to invest USD 300 million in luxury housing projects across New York, Miami, and Los Angeles. CEO Ziad El Chaar aims to finalise their first US project by year-end, emphasising equity financing and potential debt issuance. The firm targets selling half of the homes to international buyers, differing from US-focused firms like the Trump Organisation and Kushner Companies. El Chaar acknowledged potential collaboration interest with these entities but noted their market focus divergence. Dar Global's expansion into the US underscores their growth strategy in high-end residential markets amid global investment ventures....
Biden administration awards USD 85 million for affordable housing development
The Biden administration announced an USD 85 million funding package under the Pathways to Removing Obstacles (PRO) to Housing program to aid 21 state and local governments in removing barriers to affordable housing development. The initiative aims to update housing plans, revise land use policies, and streamline permitting processes. Vice President Kamala Harris and Acting HUD Secretary Adrianne Todman emphasized that this effort is part of a broader strategy to lower rents and increase homeownership. Additional funds and legislative proposals, including a tax credit for first-time homebuyers, are also part of the administration's comprehensive approach to tackling the housing crisis....
Vienna tops EIU rankings as world's most liveable city for third consecutive year
Vienna remains the world's most liveable city for a 3rd year according to the EIU rankings. The Economist Intelligence Unit scored 173 cities on healthcare, culture, stability, infrastructure and education. Vienna excelled with perfect scores in stability, healthcare, education and infrastructure but lacked in major sporting events. Western Europe did well with 30 cities averaging 92 out of 100 but saw a dip in stability due to protests and crime. North America scored high in education but faced challenges in infrastructure due to housing issues in Canada. Asian cities like Hong Kong and those in the UAE improved their rankings. Tel Aviv dropped significantly due to ongoing conflict. Damascus remains the least liveable city....
Hong Kong property market cools after initial rise post-restriction removal
Hong Kong's property market is cooling after a rise in activity following the removal of purchase restrictions in February 2024. The elimination of additional stamp duties initially boosted home sales and increased prices by 0.5% in April. However, prices dropped by 1.2% in May, indicating a shift. Contributing factors include an oversupply of unsold properties, the highest in 20 years, and high interest rates making mortgages expensive. Experts predict a further 5% to 10% price decline for the rest of 2024, with Knight Frank and S&P anticipating continued downward pressure due to these market conditions....
Blackstone acquires Village Hotels for GBP 850 Million
Global investment giant Blackstone has acquired UK mid-market hotel chain Village Hotels for GBP 850 million (INR 10,200 crore). This acquisition, which includes 33 hotels across regional cities and suburban areas, reflects increasing investor interest in the recovering hospitality sector. Village Hotels offers amenities like fitness centres, restaurants, and co-working spaces, catering to business and leisure travellers. This purchase adds to Blackstone's UK hospitality portfolio, including the 2021 acquisition of Bourne Leisure. With over 80 hotels now under management, Blackstone aims to leverage its expertise to further develop Village Hotels and capitalise on the sector's growth as travel demand rises....
US banks pass federal stress test with USD 685 billion in losses amid real estate concerns
Major US banks have passed the Federal Reserve's annual stress test, showing they can absorb nearly USD 685 billion (INR 5.2 lakh crore) in potential losses during a severe economic downturn. The test simulated a 40% drop in commercial real estate values, a 36% decline in home prices, and 10% unemployment, with all 31 banks demonstrating sufficient capital reserves. Despite this positive outlook for major banks, concerns persist about the commercial real estate market's health, especially as regional banks holding USD 4.7 trillion (INR 356 lakh crore) in loans were not included in the test. Further monitoring is required to assess these risks....
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