Hong Kong developers hunt for deals in mainland China
Developers in Hong Kong are looking to buy cheap land in mainland China as the market slows there.
The Chinese home market is softening as a result of new government rules that are hurting local developers. Beijing has restricted loans for construction, created a tax on land price appreciation, and will take away developers’ land if they don’t build their projects quickly enough, according to the International Herald Tribune.
Hong Kong developers, including Henderson Land, Sun Hung Kai Properties and Sino Land, are taking advantage of the slowdown. In June, Henderson Land was the only bidder for a plot of land in Nanjing offered at a government auction, which it bought at the asking price.
Land prices are expected to fall by thousands of dollars as landowners start to settle for lower prices because of the new credit controls. Analysts at financial services firm Nomura expect residential prices in China to decline 5 to 20 percent through the first half of 2009. Prices in some areas in the southern mainland have already fallen up to 20 percent.
More foreigners buying second homes in Greece
More foreign buyers are looking to Greece to buy or build vacation homes. About 70,000 foreigners own property in Greece, according to the International Herald Tribune, and that number is growing.
Greek brokers said Germans and British are the most numerous buyers, and agents report that more Russians are taking interest in the country.
Most of the buyers pay $600 to $1,500 per square foot for new properties, which is about 20 percent more than they did in 2005.
Some developers are trying to build luxury vacation complexes because of the increased demand for property, but the existing national laws make it difficult to develop. Developers and agents complain that laws governing real estate purchases are inadequate and the incomplete national register causes delays.
By early next year, the government is expected to dictate where new construction is allowed with new zoning laws, but the minimum plot size required for building there — about one acre — is expected to stay the same.
Government laws also make it tricky for buyers looking to purchase in Greece, and buyers usually have to hire a lawyer to navigate the paperwork and land register.
All buyers must pay taxes of 19 percent of new construction or 10 percent for older properties. Non-EU residents have to gain permission to buy property in certain areas of Greece, like the Dodecanese Islands, Crete and Rhodes.
Dubai sees home prices jump as businesses arrive
Dubai City’s financial hub is growing, which is attracting foreign business people and driving up home prices.
Dubai’s economic growth is increasing at about 11 percent a year, according to the International Herald Tribune, and the government expects it to remain at that pace. Housing prices are also seeing increases; they jumped 42 percent in the first three months of 2008.
The city draws about 20,000 new people per month, including a large number of workers from the South Asian subcontinent. Approximately 90 percent of Dubai’s population of 1.4 million is foreign.
U.S. investment banks are claiming spots in the region, despite facing steep quarterly losses. Goldman Sachs, Morgan Stanley, Deutsche Bank and UBS already have investment offices there. Barclays also just started a wealth management office in Dubai.
Morgan Stanley was one of the first American banks to move to Dubai. The bank arrived in the region in 2005 and now has 150 analysts, traders and investment bankers there.
Compiled by Jovana Rizzo