Overseas Property Blogguide to international real estate investment |
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Thursday, February 4th, 2010 
Posted by liambailey in International Real Estate Trends, Predictions, Spanish PropertyKnowing — or maybe believing is a better word — that property markets and economies around the world are on the way back up sure is a nice feeling. It may be a short-lived feeling, because according to some there are signs that the short-lived positivity will end as quickly as it begun.
Hopes have emerged that the battered Spanish property market could be hitting something that feels like a floor. Pardon the vague language, but with 1 million homes still on the market to say the future is torrid for Spanish property is an understatement despite the latest positive data.
The most positive aspect of the latest data to be released shows that home sales transactions rose 5.3% between October and November last year, leaving them down just 2.6% year on year, compared to 21% in October and 17% in September.
Monday, September 14th, 2009 Posted by Overseas Property Mall in Bulgarian Property, Cyprus Property, Dubai Property, Florida, Holiday Property, Overseas Property Finance, Overseas Property Trends, Spanish PropertyForking out for sunshine holiday homes has burned property investors as house price plunged in the recession, according to a damning new report.
The idea of opening up to the masses what was once a luxury exclusively available only to the wealthy has proved to be an expensive mistake for hundreds of thousands of Brits who dreamed of a place in the sun, say property consultants Savills and HolidayRentals.co.uk in their study.
They say the holiday home investment model is ‘broken’ and actually doubt the market existed.
The market took off in 2000, when UK-owned properties abroad were valued at £10bn.
By 2007, estimates put the number of UK-owned overseas holiday properties at 500,000 with a value of about £58 billion with markets in Spain, Florida, Cyprus, Bulgaria and Dubai taking the bulk of the money. For Bulgaria and Dubai, property prices have fallen through the floor by up to 75% and the banks have stopped lending to foreign investors.
With plunging prices, little hope of locals buying homes on holiday developments and lack of rental income, few investors have any hope of recouping their losses by selling at the bottom of the market when most owe more than their properties are worth.
At the start of the boom, 80% of the UK’s second-home owners financed their overseas property from their own wealth.
The research shows that by the market’s peak in 2007, cash buyers had fallen to 20%, with 80% of buyers taking advantage of overseas mortgage markets.
To make matters worse, many holiday home purchases were funded by taking equity out of UK homes, leaving the investors facing debt problems on both sides of the Channel. Under EU laws, creditors in other EU countries can pursue their losses through UK courts.
A lack of regulation in the property sales industry is also blamed.
Buyers speculated with borrowed money, believing that capital rising property prices would allow them to sell at a profit while rental income covered mortgage payments. Unfortunately, the recession has killed off the model as holidaymakers stayed at home rather than spending out on airfares and apartment or villa rental.
The market, according to the report, was fuelled by low cost airfares, too much liquidity in the mortgage market and that investors took little or no heed of professional, independent advice before signing contracts – and in some cases have not even visited the country where they bought property.
“Even where developers guarantee a gross income yield for a period of two or three years, the net yield is often swallowed by high service charges. In many instances, a net income yield of less than 2% is not uncommon,” said the report.
“There is an average price premium of 37% for property that is served by low cost airlines. Medium distance destinations from the UK, such as the Canary Islands and Cyprus, show the strongest link between house prices and the accessibility of low cost airlines. While this has opened up many new opportunities for buyers, it leaves destinations served by single carriers particularly exposed to the withdrawal of that service.”
The worlds No.1 footballer, Cristiano Rondaldo is making news headlines again with his apparent move into a Madrid property. Pictured above, the mansion is situated in Pozuelo de Alarcon, 15km west of Central Madrid, it comes with 1,000 square metres of internal space and 5,000 square metres of total ground space.
Wednesday, July 29th, 2009 Posted by Overseas Property Mall in Florida, Guides and Tips, Property Investment Strategies, Spanish Property, UK Property
Since the credit crunch I have become ever more cautious of recommending property investment with a view to short-term gain. I mean, I was lucky; while they aren’t growing by the percentages I forecast for this year; the destinations I recommended are still set to make the total short-term gains I was forecasting in 2007/08, by 2012/13. Places like: the Philippines, Brazil, Koh Phangan (Thailand), Tunisia, and more mostly in Latin America.
Fraud investigators are looking at a suspected international property scam that has left investors more than £40 million out-of-pocket.
Ocean View Properties, based in Staffordshire, has gone in to administration claiming overseas developers forced the company to stop trading after failing to repay millions of Euros handed over as deposits on behalf of investors.
A notice to investors on the company website claims: “Adverse press reports have undoubtedly contributed to the company’s demise though we have communicated and continue to communicate with the relevant media personnel to correct the inaccuracies that they appear to have been fed.
“It is worth noting here that there are clearly a number of people who have appeared in these articles who have subsequently confirmed that they were never personally approached or that they have been misquoted.
“With regards to the allegations surrounding Sean Woodall we can confirm that he acted as a ‘land finding’ agent for us for a period of around 4 years. It subsequently transpired that, not only was he creating problems with the developers that we were working with but he also had a ‘history’. Accordingly links between us and he were severed in 2005.”
This statement refers to articles in the Sunday Express that alleged hundreds of investors have been left at least £80,000 each out of pocket after major off-plan property deals in Spain’s Costa del Sol never materialised.
Customers were told their cash was being held in legal escrow accounts, said the newspaper, but when they asked for refunds, the money had disappeared.
Sean Woodhall set up his own company, Worldwide Destinations after falling out with Ocean View, copying the Ocean View business model in Egypt, Brazil and the Dominican Republic.
In May last year, a light aircraft said to be carrying Woodhall was reported to have crashed over Brazil.
His body has never been recovered, but he was declared dead last autumn.
Fraud officers from Staffordshire Police, City of London Police and the Serious Fraud Office are currently investigating Ocean View to see if any evidence exists to support criminal allegations.
Ocean View was set up in 2001 by buy-to-let millionaire Colin Thomas, other businessmen and Sean Woodhall, a convicted fraudster.
Investors were persuaded to buy off-plan apartments in southern Spain.
Several celebrities were involved in the marketing – but there are no suggestions of wrongdoing against any of them. They include Martin Roberts, presenter of the BBC’s Homes Under the Hammer property programme.
He claims the company owes him and his partner about £200,000.
England international footballers Gareth Barry and Alan Smith also bought—properties successfully from Ocean View.
There were first talks of plans to demolish thousands of illegal Spanish properties by the Spanish government, that scared off home owners all across the Costa Del Sol; but now,it appears the government is reversing its decision. The Spanish government is hoping to boost its dismal property market by holding off the demolition of the properties.
The much discussed and opposed “Ley de Costas” (the Coast Law) of Spain will soon expire, leaving thousands of coastal home owners of Spain in fear of having their properties demolished by the state.
In short, the Ley de Costas created in 1988 forbids the construction of privately owned property within 100 meters of the sea. The soon to expire law has created quite a spark in Spain as locals accuse the government of favouring developers who keep building their new projects at will – too close to the coastline for comfort.
Wednesday, February 4th, 2009 Posted by Overseas Property Mall in Buyers Beware, Irish Property, Spanish Property, UK Property
The full scale of alleged buy-to-let scams is starting to emerge with the collapse of mortgage lending and house prices, according to the Serious Fraud Office.
Detectives are looking at cases involving thousands of investors losing millions of pounds in alleged property frauds in the UK and overseas.
Many investigations are examining off-plan buy-to-let frauds involving hundreds of properties in Leeds, Cardiff, Nottingham, Derby, Liverpool, Hull and London.
Already this month five directors of Gateshead based PPP Ltd (Practical Property Portfolios Ltd) and sister company Napeer (Holdings) Ltd have pleaded guilty to fraudulent trading charges.
If you thought the Canary Islands (especially Tenerife) were home to drunken British tourists and tacky resorts, think again. In fact this beautiful island has so much more to offer than cheap tourism than is initially believed.
Aside from the fact that Tenerife sports an all year round excellent climate at around 22 degrees Celsius, you can also eat your heart out at the many new, hip restaurants and cafes as well as explore the many breathtaking scenic aspects of the island.
