LoftyVistas » 2009

Florida’s existing home, condo sales up in October 2009

Monday, November 30th, 2009

ORLANDO, Fla. – Nov. 23, 2009 – Florida’s existing home sales rose in October, marking 14 months that sales activity has increased in the year-to-year comparison, according to the latest housing data released by Florida Realtors®. October’s statewide sales also increased over sales activity in September in both the existing home and existing condominium markets.

Existing home sales rose 45 percent last month with a total of 15,160 homes sold statewide compared to 10,444 homes sold in October 2008, according to Florida Realtors. Statewide existing home sales last month increased 5.1 percent over statewide sales activity in September.

Florida Realtors also reported an 82 percent increase in statewide sales of existing condos in October compared to the previous year’s sales figure; statewide existing condo sales last month rose 6.1 percent over the total units sold in September.

All of Florida’s metropolitan statistical areas (MSAs) reported increased existing home sales and higher condo sales in October. A majority of the state’s MSAs have reported increased sales for 16 consecutive months.

Florida’s median sales price for existing homes last month was $140,300; a year ago, it was $169,700 for a 17 percent decrease. Housing industry analysts with the National Association of Realtors® (NAR) note that sales of foreclosures and other distressed properties continue to downwardly distort the median price because they generally sell at a discount relative to traditional homes. The median is the midpoint; half the homes sold for more, half for less.

The national median sales price for existing single-family homes in September 2009 was $174,900, down 8.1 percent from a year earlier, according to NAR. In California, the statewide median resales price was $296,090 in September; in Massachusetts, it was $290,000; in Maryland, it was $261,718; and in New York, it was $213,900.

According to NAR’s latest industry outlook, the housing market is continuing its positive momentum. “We’re getting early indications of price stabilization, but we need a steady supply of qualified buyers to meaningfully bring inventories down and return us to a period of normal, steady price growth,” said NAR Chief Economist Lawrence Yun. “That, in turn, would help fully remove consumer fears, which would then revive the broader economy.”

In Florida’s year-to-year comparison for condos, 5,398 units sold statewide last month compared to 2,958 units in October 2008 for an 82 percent increase. The statewide existing condo median sales price last month was $105,200; in October 2008 it was $147,900 for a 29 percent decrease. The national median existing condo price was $175,100 in September 2009, according to NAR.

Interest rates for a 30-year fixed-rate mortgage averaged 4.95 percent last month, a significant drop from the average rate of 6.20 percent in October 2008, according to Freddie Mac. Florida Realtors’ sales figures reflect closings, which typically occur 30 to 90 days after sales contracts are written.

Among the state’s smaller markets, the Gainesville MSA reported a total of 172 homes sold in October compared to 130 homes a year earlier for a 32 percent increase. The market’s existing home median sales price last month was $156,700; a year ago it was $173,300 for a 10 percent decrease. A total of 22 condos sold in the MSA in October, up 22 percent over the 18 units sold in October 2008. The existing condo median price last month was $116,700; a year earlier, it was $133,300 for a 12 percent decrease.

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Increase in NRI Real Estate Investment

Monday, November 30th, 2009

An estimated 25 million overseas NRIs living in 130 countries are nowadays remitting billions of dollars back home. Net inflows from NRIs have witnessed over twenty-fold rise to $4 billion in the fiscal 2009. A portion of this goes into real estate ever since liberalisation of rules by the government on NRI/PIO investments in real estate.

It is not only the easing of investment norms but the tax advantages that accrue to an investor that is driving more investments towards real estate back home. Moreover, among the five million NRIs living in West Asia are many keen to invest in real estate here as expatriate investments in countries like Dubai took a nosedive recently. Similarly, not all NRIs can afford to invest in overseas properties due to very high costs, and the high cost of managing them.

Property shows held at periodical intervals in select countries do provide an opportunity for NRIs to directly interact with the developers. This has also helped developers here ascertain the specific requirements of NRIs while planning future projects.

A number of overseas representative offices set up by banks enable NRIs to seek home loans for investments in real estate in India. Even select foreign banks in the private sector provide home and mortgage loans to NRIs. Repayment should be made by way of inward remittance through normal banking channels or by debit to the NRE, FCNR (B) or NRO account, or out of rental income derived from renting out such property. In fact, repayment is treated as equivalent to foreign exchange received for purchase of residential property.

The rules governing NRI investments are provided in the Foreign Exchange Management Act (FEMA). The prohibited areas for investments continue to be agricultural land, plantation property or a farmhouse. An NRI can acquire any immovable property in India other than agricultural land, plantation property or a farmhouse. He can transfer any property in India to a person resident in India or an NRI resident outside India other than prohibited properties. For a person of Indian origin (PIO) the same regulations would apply.

There are no restrictions on the number of residential /commercial properties purchased in India but repatriation is restricted to two residential units after a lockin period of three years. Rental income is repatriable. Thus, a number of NRIs have shown interest in leased properties across the country. Similarly, NRIs may transfer by way of gift, residential /commercial property in India to a person resident in India or to an NRI/PIO. proceeds of residential /commercial property received by way of gift should be credited to a NRO account only. As regards repatriation, an amount not exceeding $1 million per calendar year is allowed subject to production of documentary evidence in support of inheritance and tax clearance certificate/no objection certificate from the income tax authority to authorised dealer for remittances.

The CBDT has recently notified that any gift-in-kind, being an immovable property or any other property, the value of which exceeds Rs 50,000 will become taxable in the hands of the donee, being an individual or a HUF, as income from other sources. Like residents, NRIs are allowed a deduction upto Rs 1.5 lakhs per annum in respect of interest payable besides deduction on the principal repayment within the overall ceiling of Rs 1 lakh. If there is loss under the head ‘income from house property’ which cannot be set-off against any income of the same year, it can be carried forward for the next eight assessment years to be set-off against any income from the house.

A house leased for a minimum period of 300 days in a calendar year is exempt from wealth tax. Investments in commercial property will enable the investor for exemption from wealth tax. Purchase through an agreement to sell with a power of attorney duly executed by the seller has been made possible. It need not be registered and no stamp duty is payable. The benefit of cost inflation index at 631 for the year 2009-10 for saving tax on long-term capital gains is available to NRIs as well.

Posted in LoftyVistas, real estate market in India | 3 Comments »

NRIs Keen to Invest in Goa Property Market

Monday, November 30th, 2009

The tiny coastal state of Goa, known to be the best remedy for one to distress, detox and recoup, has in recent years attracted lot of investment in holiday homes by non-resident Goans (NRGs), non-resident Indians (NRIs) and domestic buyers mainly from north India. While the coastal belt with a good ‘sea view’ is always in demand, people are also scouting for inner lands overlooking hills, rivers or valleys with proximity to the city. For the first time, the state is also witnessing entry of major builders such as Pune-based Gera Developments, Mumbai’s Dynamix Group and Tata Housing and Delhi’s DLF Group and Parsvnath Developers.

So what’s triggering this real estate growth? Better quality of life, higher standard of living and good resale value, say market analysts. Earlier speaking to ET, Dinar Tarcar, proprietor, Landscape Developers, said: “people desire a good life,” which is prompting many from Delhi, Mumbai, Uttar Pradesh, Bihar and Madhya Pradesh “to look at viable options.” The demographic profile pointing to Goa to have consistently the highest per capita income and highest standard of living, is attracting people to the state. Moreover, owning a place in Goa has now become a style statement.

Property prices picked up in Goa in 2004. While many cities saw a decline with recession, in Goa, land prices have only stabilised, say developers. “In the cities, prices have not really fallen. Goa is land locked, which has kept the prices high,” said Dattaprasad Kamat, proprietor — Kamat Developers. While many new constructions are coming up, large-scale public protests against ‘mega developments’ have put many housing projects on hold, thereby hiking prices of land/projects unaffected by the agitation. Besides, many dealers who procured land at very high rates in the past few years are not willing to cut down prices.

Land value in capital Panaji has doubled in the last one year while other places across the state have seen a steady 20% increase. Nearly 75% of buyers in Goa continue to be second home seekers. “Economic meltdown has seen a 15% correction in land prices and this is unlikely to come down. If anything, prices in the interior villages will fall,” a real estate analyst said. However, sources add that the realty market, which had seen a sudden influx of small-time developers from Delhi and Mumbai making for 25% of the sellers, are dropping rates and leading to ‘panic’ sales, while the seasoned reputed developers still prefer to hold on. According to them, with clear titled saleable land being scarce in Goa, prices will continue to remain high.

Presently Panjim is the most expensive place to acquire land. The average cost in Panjim rose from Rs 25, 000 per sq m to Rs 35, 000 per sq m, with prices ranging from Rs 50, 000-100,000 in Dona Paula and other water fronts. Calangute and the northern coastal belt, comes a close second with the average price for a property being Rs 30,000 per sq m. Costs, however, increase with proximity to the sea. But head to south Goa, and you’ll probably get a better bargain. Prices here are said to be lower than northern coast with start up rate for a place near Colva beach between Rs 18,000 and Rs 22, 000 per sq m. Beaches in the north are abuzz with activities. In comparison, the coastal belt of southern Goa is known more for its picturesque locale.

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Asset Management Companies Target Overseas Investors

Monday, November 30th, 2009

Asset management companies have begun selling India to the world yet again. A few domestic fund houses, along with scores of smaller investment companies, are targeting overseas investors through offshore offerings. While a good number of them are finding it difficult to find investors, funds launched by firms with good track record and credibility are attracting investments. ICICI International, Kotak Mahindra, UTI International, Baer Capital, Tata Capital and Alpen Capital are amongst the leading fund houses considering to launch offshore investment schemes. Birla Sunlife is currently raising money to start its offshore realty fund.

“Post the fall of Lehman Brothers, brands and brand value have lost credibility. Investors are only looking at past performance and investment objectives while investing. Funds with good fund management team get money; others will have to settle for lesser investments,” said the product head of leading domestic fund house. According to investment experts stationed abroad, India is regaining popularity among foreign investors. The tag of being ‘one of the best risk-adjusted return markets’ had eluded India, after offshore funds shed 60-80% (in value) at the height of bear market.

“We are getting good response from high net worth individuals (HNIs) for our real estate fund,” said Shashi Kumar, real estate (head), Birla Sunlife Asset Management. “Investors, for sure, have become very cautious, while investing into funds. A lot of research is done by investors themselves before investing in an offshore fund,” Mr Kumar added. According to fund-runners, Japanese and Korean investors (mainly pension funds) are finding India attractive for capital investments. Investments from the Gulf-based investors have dipped greatly over the past one year. Investments from Europe and America is yet to gather steam, said experts. “Compared with the past year, there is genuine interest among investors to park their money in Indian asset classes. Money will continue to flow into Indian markets; offshore funds could well be one of the routes. The lone impediment (to inflows) will be the lengthy regulatory requirements to invest in Indian markets,” said Barjeel Geojit Securities CEO Krishnan Ramachandran.

Offshore funds are specialise in investing in foreign companies or corporations. These funds have non-residential investors (often high net worth investors and institutions), and are regulated by the provisions of the foreign countries where these are registered. Most of these funds are launched from tax havens like Mauritius or Cayman Islands. Overseas funds have been active in India, investing in all sectors of the equities market. As per market estimates, there are about 50 offshore funds (with over 150 variants/plans or themes) investing in India. The $6-billion HSBC GIF Indian Equity fund (with about 11 variants/themes) was the biggest offshore fund until some time back.

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Brazilian real estate set to be hot property in 2010

Sunday, November 29th, 2009

With the Olympics set to take place in 2016 and the World Cup even sooner in 2014, Brazil is getting a lot of positive attention at the minute. And it seems that there are plenty of reasons for the country t hot property in 2010, according to an industry expert.

Nick Marr, chief executive officer of HomesGoFast.com, said that the construction and infrastructure upgrade works in the country ahead of the 2016 Olympic Games will help to boost real estate sales. The upcoming football World Cup in 2014 will also see a boom in infrastructure investment, with 12 host cities seeing new sporting facilities being upgraded or constructed. The South American country has been tipped ahead of France and the US as the place to invest next year.

Mr. Marr added that Brazil would be the number one place for investors and it is the place generating most interest. The great thing about Brazil is that investors have good exit opportunities with local and overseas buyers to sell to when the time comes. He also advised that people should look at properties in Natal, Bahia, Rio Grande do Norte and Ceara as the most favourable investment areas.

According to The Organization for Economic and Development Cooperation (OEDC), Brazilian property owners will experience robust growth of the country’s economy in 2010 and 2011. The Organization has predicted that the country will see growth of around 4.5 per cent, performing better than other nations.

A report from the organization suggested that next year “the government could begin to roll back budget incentives as the economy consolidates”. The predictions are an improvement on earlier ones, which estimated 0.8 per cent growth in 2009 and four per cent in 2010.

Posted in LoftyVistas, Real Estate in Brazil | 2 Comments »

EU economic report boost Turkish property

Sunday, November 29th, 2009

Increasing numbers of visitors, a new list of reputable real estate agents and the news that Turkey set to become the fastest growing country in Europe in 2010 with a 2.8 percent growth rate are set to give Turkey’s property market a boost.

European Commission’s economic forecast report for fall has estimated that Turkey would shrink 5.8 percent this year and the growth rate would climb up to 3.6 percent in 2011. The commission report said unemployment would rise to 13.9 percent in 2010 and fall to 13.5 percent in 2011. Tourism officials expect the number of tourists to increase significantly in 2009 and again in 2010 when Istanbul becomes European Capital of Culture.

According to the World Tourism Organization (WTO), Tourism grew 1.47 percent in Turkey as shrinking 7 percent in the world in the January-July period of 2009. Overall figures from the Turkish tourism department indicate that visitor numbers are predicted to rise by 10% this year bringing in billions of dollars worth of revenue.

Tourism minister Ertugrul Gunay said that Tourism grew 1.47 percent in Turkey in the same period with number of tourists rising up to 21.8 million. Number of tourists increased only in Turkey among the ten most popular tourism destinations in the world.

Further good news for Turkish property investors is the property prices have been falling like many other parts of Europe and are set to become even more attractive to foreign real estate investors especially those from the UK as the pounds continues to be weak against the euro and the dollar.

Posted in LoftyVistas, Real estate market in Turkey | 1 Comment »

Forum Istanbul, the largest shopping mall in Europe

Sunday, November 29th, 2009

Forum Istanbul, the largest shopping and lifestyle center in Europe was opened on November 17th in BayrampaÅŸa, near the center of Istanbuls European side. Generating employment for 5,000 persons, Forum Istanbul aims to draw 25 million visitors per year and a targeted annual turnover of â‚¬500 million.

Developed by Multi Turkmall, Forum Istanbul is the seventh project in Turkey and the first in Istanbul of Multi Turkmall. The construction of Forum Istanbul was completed by a total investment of â‚¬750 Million during the global economic crisis. Forum Istanbul consists of 495,000 mÂ² total construction area, 175,000 mÂ² rentable space, 265 national and international brands.

Speaking during the complexâ€™s opening ceremony; Multi Turkmall CEO Levent EyÃ¼boglu said that including the storesâ€™ investments, the total figure for the complex adds up to 1 billion euros. The shopping center stands on an area of 495,000 square meters and will employ 6,000 people. â€œWe had never made such an effort as we did to build this shopping complex,â€ he said. â€œI doubt we can ever do anything better and more beautiful than Forum Istanbul.â€

In good news for rental property investors, Forum Istanbul intends to play an important role also in the cultural, artistic, entertainment and social life of Istanbul, and has already started to host national and international events. The â€œ50 Years with Barbie and Lego Exhibitionâ€, featuring hundreds of Barbie dolls and giant sized Lego installations which is exhibited in more than 40 cities has opened in Forum Istanbul. The exhibition, which will remain open until January 24th, 2010.Another is the Fish in Color Exhibition. This will remain open until December 17th, 2009, and showcases the work of Sculptor; Server Demirtas and his team.

Meanwhile, Culture and Tourism Minister ErtuÄŸrul GÃ¼nay said that Forum Istanbul is a very suitable investment for the city and he added that The ministry will continue to give full support to â€œforumâ€ projects that are being constructed all over Turkey.

On his part, BayrampaÅŸa Mayor HÃ¼seyin BÃ¼rge said he had always dreamed of his district being remembered for something other than the BayrampaÅŸa jail. â€œFinally, with this project, my dream has become real.â€

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Office Rentals go Down at Prime Locations in Delhi and Mumbai due to Oversupply

Sunday, November 29th, 2009

Excess supply has made office rentals in key commercial centres in Mumbai and Delhi come down by half over last year, and realty analysts fear that with business houses waiting for economic activity to pick up speed and a raft of new commercial facilities nearing completion, the rates could head further southwards.

Residential prices have firmed up after the lows they hit late last year, but the recent uptick in macro economic activity is yet to trickle down to sectors such as retail. Realty consultants said in Mumbai there are vacant commercial properties in Malad, Thane, LBS Marg and Andheri MIDC despite the fall in rentals. Rentals have crashed from Rs 400 per sq ft in December last year to around Rs 250 per sq ft now in Mumbai’s commercial hub, the Bandra Kurla Complex (BKC).

According to sources an FMCG company is asking for rentals at 35% lower rates than what it was a year ago for its 1.5 lakh sq ft office space in south Mumbai. Samsung recently took 90,000 square feet on rent on Gurgaon’s Golf Course Road for Rs 58 per sq feet against the asking price of Rs 80 a sq feet. In another deal, a tenant has leased out 50,000 sq ft at DLF Cybercity in Gurgaon for Rs 45-50 per sq ft while the quoted rent was Rs 60-65 per sq ft. “Since there is a downward pressure on many developers and building owners, one may witness even bigger deals at further lower rates,” said Kaustuv Roy, executive director, Cushman & Wakefield.

In Mumbai, supply of the commercial space has gone up with constructions of new buildings and shifting of offices to the cheaper complexes giving the buyers a chance to bargain. For example, JP Morgan is shifting its office from Mafatlal Centre at Nariman point in South Mumbai to Kalina near BKC. This will free up close to one lakh sq ft of space in Nariman Point, further suppressing rentals.

Vacancy — the difference between demand and supply — at Lower Parel is estimated to be around 22%. The number is as high as 35% in North Mumbai and 25% in BKC. Many developers prefer to hold on to their vacant properties rather than leasing them out on lower rentals just to keep the premium tag of the properties intact, said real estate consultant Anckur Srivasttava.

However, the capital value of commercial properties is not falling despite the fall in rentals. New Delhi, in particular, has seen a strange anomaly between rental and capital values. While rentals are still in the Rs 50-70 per sq ft range, capital values are in the Rs 11,000-13,000 per sq ft range.

Posted in LoftyVistas, real estate market in India | 2 Comments »

Emaar Demands Rs800 cr from DDA for Commonwealth Games Apartment Project

Sunday, November 29th, 2009

Real estate firm Emaar MGF Land Ltd has asked the Delhi Development Authority (DDA), the agency that oversees urban development in the national Capital, for Rs800 crore upfront for the apartments it is building at the Commonwealth Games Village, according to people familiar with the development. The construction site of Commonwealth Games Village 2010 in New Delhi. Given the realty slump, Emaar MGF has been finding it difficult to attract buyers for its apartments.

The construction site of Commonwealth Games Village 2010 in New Delhi. Given the realty slump, Emaar MGF has been finding it difficult to attract buyers for its apartments. Emaar MGF had won the rights from DDA for Rs321 crore to develop and sell 800 flats out of the 1,168 it is building at the site in a project considered to be of national importance. DDA has the marketing rights for the remaining apartments. DDA has set up a committee to decide on the fair valuation of the apartments, the people said. At whatever rate per sq. ft is decided by this committee, Emaar MGF is willing to hand over the proportionate number of flats for Rs800 crore, they said. This development follows the breakdown of talks with DDA for a Rs100 crore loan for which it, in return, had sought a bank guarantee of Rs100 crore, an indefinite corporate guarantee and 75 flats.

Athletes taking part in the 2010 edition of the Commonwealth Games will be staying in the village. DDA has set up a committee to decide on the fair valuation of apartments at the site Given the realty slump that has caused property prices and land valuations to dip, Emaar MGF has been finding it difficult to attract buyers for its apartments at the site. In addition, environmentalists had taken DDA to the Delhi high court in 2007 to stop construction at the village site which they said was too close to the Yamuna river; in an interim order the court ruled that customers should buy an apartment at their own risk. Emaar MGF first asked DDA for financial assistance in December.

Posted in LoftyVistas, real estate market in India | 1 Comment »

DLF to Build Rs 15 cr Flat in Delhi’s Posh Locality

Sunday, November 29th, 2009

Real estate major DLF is coming up with Rs 15 crore flats in the posh Greater Kailash area, courtesy Municipal Corporation of Delhi (MCD), alleges Congress. Leader of Opposition in the Municipal Corporation of Delhi Jai Kishen Sharma has alleged that the civic body has “illegally” allotted the land meant for park and community centre to the DLF. The Bharatiya Janata Party is in power at the Town Hall. Claiming that the civic agency is hand in glove with the ruling party, Sharma said: “In clear violation of the MCD rules, plots measuring 1.5 and 2.5 acres have been allotted for building apartment complex. The land was meant for civic facilities like parks and community centre. This was done to increase the ground coverage of the housing society and give undue benefits to DLF.”

The real estate major is building eight and nine storey apartment buildings in the E and W blocks of the Greater Kailash-II. The building plans were sanctioned in 2007. DLF has already started construction on the plots. Captain KS Singh, a MCD councilor from south Delhi, said: “When the plots were allotted the topography of the area was very different from what it is today. Now, the area is densely populated. So, there should be no construction here as civic infrastructure will crumble if these housing projects come up.”

However, MCD officials refute the charges, saying the resolution for allowing the construction was passed by the Standing Committee way back in 1989. Some residents had also moved the Supreme Court on the issue, but the court ruled in favour of the MCD. The layout plan was sanctioned around two years ago. “I have asked the Commissioner to look into the matter and submit a report within three days,” Standing Committee chairman R K Singhal said.

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Archive for November, 2009

Florida’s existing home, condo sales up in October 2009

Increase in NRI Real Estate Investment

NRIs Keen to Invest in Goa Property Market

Asset Management Companies Target Overseas Investors

Brazilian real estate set to be hot property in 2010

EU economic report boost Turkish property

Forum Istanbul, the largest shopping mall in Europe

Office Rentals go Down at Prime Locations in Delhi and Mumbai due to Oversupply

Emaar Demands Rs800 cr from DDA for Commonwealth Games Apartment Project

DLF to Build Rs 15 cr Flat in Delhi’s Posh Locality

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