Archive for June, 2010

And you thought square footage in Vancouver was expensive ….

Tuesday, June 15th, 2010

Two years of global recession have made villas and apartments in some of the world’s most desirable locations dramatically more affordable – but still way higher than Vancouver’s comparable sales – according to figures researched by UK estate agency, Savills, and published in the Daily Telegraph.

[To provide a comparison with Vancouver, I have converted all sterling figures into CAD and changed the price per square metre (the preferred calculation in Europe) to a price per square foot. According to the May 2010 figures from the Real Estate Board of Greater Vancouver (REBGV), the average apartment price in Vancouver Westside is $510,885. If the average apartment size is approximately 600 square feet, that equates to $851 per square foot.]

The results of Savills’ survey shows Marrakesh as the best-value location with riads and apartments in prime parts of the Moroccan city costing $588 per square foot thanks to the city’s low land and construction costs. In central Europe, Montenegro offers beautiful countryside and some of the world’s most unspoilt coastlines and costs $1,507 per square foot with recent improvements to its air links with Britain and its own transport infrastructure.

Likewise in the Middle East, the Sultanate of Oman, which has avoided the blingy excesses of Dubai and is regarded as an elegant low-rise location, costs $776 per square foot. Also good value is the Seychelles, where prime property is $993 per square foot.

The league table also shows which locations have held their values well, despite the recession. Italy, the Balearics and parts of France stand out in this regard. “Majorca has a large gene pool of buyers. This gives it a very resilient market,” says Charles Weston-Baker, director of Savills’ international department, who adds that purchasers come from Britain, northern Europe and the USA. He contrasts that with mainland Spain, which is these days almost wholly reliant on British buyers, who are now stepping back. The country also has a serious oversupply of new homes.

The data also shows that some of the world’s most expensive international hot spots have been relatively recession-proof. “It’s not a surprise that key financial hubs such as Paris, Moscow, Hong Kong or Shanghai generate high values. But it’s clear that traditional world-renowned ‘lifestyle’ destinations such as Cannes and Courchevel continue to attract high-spenders, as does Monaco,” says Savills’s researcher Rebecca Gill, the author of the survey.

The agency sold an apartment in Hong Kong for $29,763 per square foot late last year, about 20 per cent above the top-price London property it sold, while Monaco and Manhattan have seen sales at or above $24,650 per square foot. Paris, the Cote d’Azur and Sydney had one-off top-dollar sales that were close behind.

What costs what, where – Prime apartment property, price per square foot

* Monaco $20,649
* Cannes $10,325
* Courchevel, France $8,262
* Moscow $7,534
* Hong Kong $6,003
* Sydney $5,348
* Paris $4,649
* Manhattan $4,521
* Shanghai $4,470
* Singapore $4,219
* Milan, Italy $4,128
* Sardinia $3,714
* Majorca $3,300
* Geneva $3,195
* Auckland $2,928
* Cape Town $2,528
* Nice $2,478
* Lisbon $2,064
* Warsaw $1,883
* Dubrovnik, Croatia $1,859
* Istanbul $1,813
* Zell am See, Austria $1,650
* Ho Chi Minh City, Vietnam $1,580
* Budva, Montenegro $1,507
* Dubai $1,390
* Algarve, Portugal $1,239
* Sotogrande, Spain $1,239
* Nevis, Caribbean $1,197
* Sarasota, Florida $1,148
* St Lucia, Caribbean $1,083
* Seychelles $1,105
* Hanoi, Vietnam $904
** Vancouver Westside $851
* Muscat, Oman $776
* Cairo $604
* Marrakesh $588

US foreclosures declining slightly

Thursday, June 10th, 2010

Slightly encouraging news from our neighbours south of the border. May showed that the number of foreclosures filed had decreased by 3 per cent compared to April’s figures.

Topping the list for the 41st month in a row is Nevada where one in every 79 houses received a foreclosure filing, followed by Arizona (one in every 169 households), Florida (one/174), California (one/186), Michigan, Georgia, Idaho, Illinois, Utah and Maryland.

According to the U.S. Foreclosure Market Report released by California-based RealtyTrac, a total of 322,920 houses received filing in May, meaning that one in every 400 houses received an auction notice. Compared to April, where a total of 333,837 households received auction notice.

Though the filings have exceeded 300,000 for the 15th straight month, the foreclosure rate has receded over the past few months.

“The numbers in May continued and confirmed the trends we noticed in April: overall foreclosure activity is leveling off while lenders work through the backlog of distressed properties that have built up over the past 20 months,” stated James J. Saccacio, chief executive officer of RealtyTrac.

Despite the overall unemployment rate declining, from 9.9 per cent in April to 9.7 per cent in May, the fall was mainly through so-called “discouraged workers” leaving the job market. And while the headline figure of a net 431,000 jobs created during May looks like solid growth, the vast bulk of those jobs came from temporary hiring related to the US census, which alone added 411,000 jobs.

We are yet to see a longterm US employment recovery which will have the obvious positive repercussions on the US housing market. At the moment, it’s still very weak but oak trees do grow from acorns.

Greater Vancouver returns to a buyers’ market

Monday, June 7th, 2010

The Real Estate Board of Greater Vancouver (REBGV) published its May figures showing what a lot of people have realised that the market has reverted in favour of buyers with listings up and sales down.

Full details of the report continue here:

The REBGV reports that residential property sales in Greater Vancouver totalled 3,156 in May 2010, a decline of 10.4 per cent compared to the 3,524 sales in May 2009; 5.1 per cent more than the 3,002 sales in May 2008; and 27.1 per cent less than the 4,331 sales in May 2007. May 2010 sales also represent a 10.1 per cent decline compared to last month’s sales.

In terms of number of property listings, last month marked the third consecutive month during which more than 7,000 homes were listed for sale on the Multiple Listing Service (MLS®) in Greater Vancouver.

New listings for detached, attached and apartment properties totalled 7,014 in May 2010, a 48.2 per cent increase compared to May 2009 when 4,733 new units were listed, and an 8.3 per cent decline compared to April 2010 when 7,648 properties were added to the MLS®.

At 17,492, the total number of property listings on the MLS® increased 10 per cent in May compared to last month, and is up 28.2 per cent compared to this time last year.

“Prospective home buyers in today’s market have a broad selection to choose from in every property type. REALTORS® are telling us they’re working with buyers who are not feeling as rushed to make a decision as they did late last year and earlier in the year,” Jake Moldowan, REBGV president said.

Over the last 12 months, the overall MLSLink® Housing Price Index (HPI) benchmark price for all residential properties in Greater Vancouver increased 16.7 per cent to $590,662 from $506,201 in May 2009.

“It’s important for those looking to buy or sell a home to remember that real estate is local and wise real estate decisions are made by those who understand current market conditions at the neighbourhood level,” Moldowan said.

Sales of detached properties in May 2010 reached 1,256, a decrease of 10.4 per cent from the 1,402 detached sales recorded in May 2009 and a 4.4 per cent increase from the 1,203 units sold in May 2008. The benchmark price for detached properties increased 19.1 per cent from May 2009 to $810,175.

Sales of apartment properties reached 1,354 in May 2010, a decline of 7.1 per cent compared to the 1,458 sales in May 2009 and an increase of 8.8 per cent compared to the 1,244 sales in May 2008.The benchmark price of an apartment property increased 13.9 per cent from May 2009 to $398,783.

Attached property sales in May 2010 totalled 546, a decline of 17.8 per cent compared to the 664 sales in May 2009 and a 1.6 per cent decline from the 555 attached properties sold in May 2008. The benchmark price of an attached unit increased 14.8 per cent between May 2009 and 2010 to $500,339.

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