The Canadian housing market is calming rather than crashing, as the impact of tougher mortgage rules and cooling credit is partly offset by the supportive influence of low interest rates and continued income growth, according to a new report from BMO Economics.

“House prices have hit record highs in most regions across Canada, though the rate of appreciation has slowed,” said Sal Guatieri, Senior Economist, BMO Capital Markets.

Resale markets are largely balanced, though buyers have gained leverage in some provinces, including Quebec and British Columbia.

Steadier prices are expected in the year ahead amid decent job growth. A benign outlook for rates and income should support affordability this year, weighing towards relatively steady sales and prices in most regions.

Canadian Housing Market Balanced Mr. Guatieri noted Toronto house prices, though slowing, hit a record high in April; gains in the detached market more than offset slightly lower condo values. Alberta enjoyed decent price gains, while Vancouver’s prices have declined moderately.

“Nationwide, housing starts have adjusted to the reduced demand, returning to household formation rates,” Mr. Guatieri added. “Meantime, Toronto continues to build up rather than out to meet supportive demographic demand.”

BMO Housing Confidence Report found that nearly half of Canadian homeowners (48 per cent) intend to buy a property in the next five years — mostly unchanged from fall 2012 — signalling a high level of confidence in Canada’s housing market is continuing into 2013.

Laura Parsons, Mortgage Expert, BMO Bank of Montreal, noted that it is essential for both buyers and sellers to be aware of any changing conditions on the local level. “If planning to buy or sell a property, consider working with an expert who can help you make decisions that are appropriate to the health of your local market, and more importantly, that responsibly fit within your particular financial situation.”

Source: MarketWire, Vancouver Sun

Prices of ultra-prime property in the world’s leading financial destinations are set to grow by more than a quarter in the next five years.

The value of residential homes worth more than £10-million in London, New York, Hong Kong and Singapore will rise 27% in the next five years, new data from leading property and finance companies predicts.

Nick Candy, Chief Executive of developers Candy & Candy says, “By 2017 the Ultra High Net Worth Individuals (UHNWI) population is expected to have increased by 20% and their wealth by 30%.

“A trophy safe haven property in a global city is typically at the top of the shopping list for wealthy individuals, and their continuing appetite for such investment is expected to exert even greater influence over global property markets in the next few years.”

In 2012 there were more than 300 residential real estate transactions of over £10million that together were valued at more than £6.6billion, Savills research shows.

The total is expected to grow by 400 per year up to 2017 to a total value of £8.4billion. This growth is expected to be both organic and incremental as ultra-prime area expand and new properties are built, driven by the direct impact of global wealth increases and sector price rises.

Global wealth is predicted to increase by around 5% a year from around $122trillion to $150trillion by 2017, figures from The Boston Consulting Group show.

The research, produced by Candy & Candy, Savills and Deutsche Bank, this growth is already underway, as the number of billionaires rose by over 10% in the past year and their wealth increased by 14%.

Much of this wealth creation is being generated in emerging markets such as Africa, central Asia, China and South Korea. Asia’s wealth creation is already rising 11% a year and in Russia, Eastern Europe and Latin America by 9% a year.

North America is home to over one third of the UHNWI population and New York has the highest share of this figure and residential property in the city is good value following price falls in the national property market, says the report.

But when it comes to property transactions over £10million, London is a bigger market than New York, with more than 70% of sales going to overseas buyers, many of whom are establishing a base to live and work.

The rapid rise in wealth generation in Asia has had an unprecedented impact on price growth in the prime residential markets of Hong Kong and Singapore, with property prices increasing by over 150% in each. Asia’s UHNWI population is expected to grow by 50% more than North America’s in the next five years.

The report also examines the real costs to buy, occupy and sell a £10million property in London, New York, Hong Kong and Singapore.

Yolande Barnes, director of Savills World Research, says, “Recent changes to the taxation of international buyers owning property, particularly to stamp duty in Singapore and Hong Kong have made these locations expensive jurisdictions in which to invest. They now rank alongside New York in this respect.

“London’s recent tax changes pale by comparison and the UK capital remains one of the cheaper of the four cities in which to own and occupy real estate.

“But wealthy owners face paying higher property taxes. Hong Kong and Singapore has experienced such rapid price growth that property transaction taxes have been significantly increased by their governments to control the markets. New York has a long established annual property tax and London has also raised its levels of stamp duty and continues to debate the merits of a mansion tax.”

Although tax changes have failed to have a noticeable impact on the buying habits of UHNWIs, there are fears that manoeuvres by governments will put off investors down the line, the report says.

“Evidence from different global markets suggests that the taxation of market transactions tends to reduce the incidence of these transactions so turnover rates have reduced after the introduction of stamp duty taxes,” explained Yolande Barnes.

“We won’t see the rate of ultra-prime house price growth abating significantly over the long term. It will be driven by the rarity value and desirability of homes in established world cities,” she adds.

Source: Overseas Property Professional

Chairman Cheng Wai Keung is seeking a record S$300 million (US$242 million) for a home near Singapore’s Orchard Road shopping belt, betting that developers may profit from dividing the site.

The 85,000-square-foot site on an elevated lot at 33 Nassim Road, near the city’s Botanic Gardens, includes a two-story home, swimming pool and tennis court, according to Jones Lang LaSalle Inc., the sole marketing agent.

“These kinds of assets come onto the market once in 10, 15 or even 20 years,” Karamjit Singh, head of investments and residential at Jones Lang LaSalle in Singapore, said in a phone interview yesterday. “The potential buyers of this league would be able to recognize the opportunity.”

Singh estimated the property in an area that includes the residence of the British high commissioner and embassies of Japan and Russia could fetch between S$250 million to S$300 million. The site may be sold as two lots, which can yield a total of five homes, he said.

“This is beyond economics, it’s mind boggling and probably one of the highest in the world,” said Alan Cheong, senior director of research and consultancy at broker Savills (Singapore) Pte. “It’s no small change even for the ultra high net worth. It could be an Indian tycoon or a Russian oligarch that might bid for it.”

The price is 79 percent higher than the $135 million listing for the Crespi-Hicks Estate in Dallas, according to broker Douglas Newby, which is marketing the property. The home on the 25-acre site, owned by former Texas Rangers owner Tom Hicks, is touted as the most expensive property for sale in the U.S., according to a report by Time Magazine on Jan. 31.

“The primary value of a property is based on the land value,” Newby said in a phone interview yesterday. For the Singapore property, “if the land is worth $150 million to $200 million, then this might be a legitimate buy.”

Mukesh Ambani, India’s richest man who’s ranked the 28th richest on the Bloomberg Billionaires Index, owns a 27-story home in Mumbai valued at about $500 million, adding to his $22.4 billion net worth.

Residential prices in Singapore climbed to a record in the first quarter as an increase in the number of millionaires drove up demand. Singapore is Asia’s most-expensive housing market after Hong Kong, according to a Knight Frank LLP and Citi Private Bank report released last year that compared 63 locations globally.

Increasing wealth in the island-state has contributed to rising property prices. Singapore’s millionaire households rose 14 percent in 2011, according to a Boston Consulting study. The proportion of millionaire homes in the city of 5.3 million people was 17 percent, the highest in the world, followed by Qatar and Kuwait.

Source: Pooja Thakur, Bloomberg

Not for the faint hearted – the US $125-million price tag makes this residence the most expensive public listing in New York City!

The triplex penthouse located at The Pierre Hotel encompasses the entire 41st, 42nd, and 43rd floors. The residence encompasses 16 grand rooms, including a living room considered the most magnificent privately owned room in the world. There are four adjoining terraces, five master bedrooms, six full baths and three half-bathrooms, five working fireplaces, separate guest suites plus staff accommodations, and sweeping 360-degree views of Central Park and the surrounding city. The spread, formerly home to the hotel’s Pierre Roof restaurant, also touts a 3,500-square foot grand salon, once used as a ballroom.

Owned by the estate of late finance maven Martin Zweig, the triplex apartment is expected to officially hit the sale block before week’s end, according to multiple sources.

At $125-million, the Pierre penthouse would be the most expensive home publicly listed for sale in NYC, trumping the $100-million CitySpire penthouse and the reported $115-million Bloomberg Tower duplex owned by billionaire Steve Cohen. The $125-million price tag would also make it one of the top three priciest residential properties in America, behind a Dallas estate currently asking $135-million and tied with Los Angeles’ $125-million Fleur de Lys.

Still, for all its grandeur, several luxury brokers who have toured the space with clients suggest the unit may be in need of a little updating.

The Pierre is a white-glove building situated on East 61st Street, near Fifth Avenue. It’s comprised of a five-star hotel and 75 co-op apartments. Residents enjoy hotel amenities like room service — which even caters to pets — and twice-daily maid service, included in hefty monthly maintenance payments. As of 2006, annual maintenance for the penthouse was $464,600.

Residences in the building must be purchased all-cash and potential buyers must pass the stringent co-op board, a factor that typically lessens the possibility of a foreign buyer.

Source: Morgan Brennan, Forbes

Monaco could soon become home to the world’s most expensive penthouse. Spanning 33,000-square-feet and situated on the top floors of a 49-story building in Monaco, this penthouse is now the world’s most expensive, with an asking price of $380-million. It features six bedrooms and a two-story water slide that goes directly into an infinity pool overlooking the ocean.

Prominent names are involved in the project which was dreamed up by architect Alexander Giraldi in a style inspired by belle epoque design. The responsibility for the apartment interiors has been given to the Alberto Pinto agency, while grounds are being done by landscape architect Jean Mus.

The construction started back in 2009 and is expected to be complete by July 2014.

Soaring to 170 metres on its completion in 2014, Tour Odeon will be the tallest building in Monaco and one of the tallest residential towers in Europe.

A limited number of luxurious private residences are available for purchase within the tower benefitting from unprecedented 360-degree views over the sea and the Principality, to be enjoyed through floor-to-ceiling windows and from expansive private terraces.

Residences will feature the very highest quality finishes and fixtures, including home automation and fully-equipped kitchens and bathrooms. Alberto Pinto, one of Europe’s foremost interior designers, has been commissioned to design and decorate interiors of exceptional elegance and comfort.

Owners will benefit from a comprehensive array of on-site services and amenities including spa and leisure facilities, state-of-the-art business centre, select retail boutiques and 24-hour concierge.

• 1,001 – 7,000 sq.ft.
• Leisure Facilities
• 24-hour security
• Balcony
• New Build
• Water View
• Swimming Pool
• Terrace
• International Development
• Freehold

Source: luxuryes.com/Knight Frank/Sky News

New York is the lone U.S. city to land in the top 10 most expensive residential real estate markets in the world, according to a new report from Knight Frank.

But with luxury homes in New York costing anywhere from $2,030 to $2,240 per square foot, it’s only about half as expensive as the most expensive housing market in the world: Monaco. There, luxury homes can cost $5,350 to $5,920 per square foot. Monaco, which does not charge a personal income tax, was particularly popular with Russian buyers over French markets, according to the report.

Luxury real estate prices there increased 2 percent year over year. Prices in 2012 jumped the most in Indonesia, where they increased 38 percent in Jakarta and 20 percent in Bali.

The number of wealthy people in the world is also growing, and set to increase quickly in the next decade, according to the report.

The number of people worldwide worth $30 million or more increased by almost 8,700, or 5 percent, in 2012, and their number is set to increase 50 percent in the next 10 years, according to Knight Frank’s forecasts.

The following are the top 10 priciest housing markets in the world and the average cost per square foot in U.S. dollars, according to the report:

Monaco: $5,350 to $5,920
Hong Kong: $4,570 to $5,050
London: $3,890 to $4,300
Geneva: $2,720 to $3,010
Paris: $2,350 to $2,600
Singapore: $2,340 to $2,580
Moscow: $2,040 to $2,260
New York: $2,030 to $2,240
Sydney: $2,020 to $2,230
Shanghai: $1,820 to 2,020

Other U.S. cities rounding out the top 20 list were Miami at number 13 (priced between $1,300 to $1,440 per square foot) and Los Angeles at number 15 (priced between $1,210 to $1,340 per square foot).

Source: Realtor Mag/Business Insider

(Please note that Canada is not one of the countries analyzed by the Global Property Guide).

The world’s housing markets moved clearly down during the year to the first quarter of 2012, according to the Global Property Guide’s latest house price indices survey.

Residential property prices fell in 24 countries, of the 36 countries for which quarterly house price statistics are available, and rose in only 12 countries.

During the latest quarter the downturn appears to have accelerated, with property price falls in 26 countries and price gains in only 10.

In nominal terms only 16 countries experienced home price falls during the year, while 20 countries recorded price rises. But the Global Property Guide’s statistical presentation uses price changes after inflation, giving a more realistic picture than the more upbeat nominal figures usually preferred by estate agents.

Faster-paced deterioration in European housing markets

Ireland’s price-declines have been, over the duration of the crisis, catastrophic. It is disheartening to see more agony, yet the picture really is alarming. House prices fell 18.95% year-on-year, contrasting with a decline of ‘only’ 13.12% during the same period last year. Furthermore, house prices were down 5.19% during the latest quarter. Tough credit conditions, an oversupply of housing, and weak domestic demand have weighed down the Irish residential property market.

There was also an alarming increase in momentum of house-price declines in Athens, Greece (-11.68%); in Warsaw, Poland (-10.94%); in Portugal (-10.45%); in Spain (-9%); in the Netherlands (-6.05%); and in the Slovak Republic (-5.89%). All saw bigger house-price declines this year than the previous year.

Several countries whose housing markets were last year either in recovery or only just in downturn, saw a significant deterioration in their position, with house price falls during the year to end Q1 2012 in Finland (-2.05%), in Turkey (-2.32%), Sweden (-5.34%) and Riga, Latvia (-5.83%).

In other European countries, any positive changes in the momentum of the housing markets were so feeble, that they hardly signal a recovery. These countries include Kiev, Ukraine (-2.51%), Croatia (-2.45%), United Kingdom (-3.14%), Lithuania (-3.87%) and Bulgaria (-6.21%).

Some strong European markets do relieve the gloom. In Estonia house prices surged by 9.13% year-on-year, and in Austria house prices rose by 8.24% year-on-year. In fact the upsurge in these two countries’ housing markets was so strong as to propel them into third and fourth place in the worldwide league table.

Other strong housing markets over the past twelve months include Switzerland (+5.49%), Norway (+5.43%), Russia (+3.86%) and Iceland (+2.25%). The ‘gainers’ seem to be countries whose housing markets either never experienced the recent downturn (Austria, Switzerland, Norway), or are recovering (Estonia, Russia, Iceland).

House prices in India (Delhi) and Brazil (Sao Paulo) surged further, but momentum was down during the quarter. Over the year to Q1 2012, Delhi house prices skyrocketed by 24.41%, though during the last quarter, they fell 0.07%. Some other Indian cities like Chennai and Kolkata saw house price falls year-on-year, according to NHB Residex.

In Sao Paulo, house prices climbed by 18.70% in the year to Q1 2012, but the latest quarter saw a price-decline of 2.57%.

Most Asian housing markets slowing

In the Philippines (Makati Central Business District), prime condominium prices rose by 7.34% during the year. But the figures possibly exaggerate the upsurge, because they are for Makati, the heart of the Philippines’ business process outsourcing boom. In South Korea house prices were up 2.67% from a year earlier.

Housing markets in the rest of Asia cooled over the year to Q1 2012, due to government measures implemented last year. House prices in Hong Kong were up a mere 0.19% on the year, after a rise of 19.80% the previous year. There were house price falls in Indonesia (-0.13%), Singapore (-1.36%), Tokyo, Japan (-2.64%) and Shanghai, China (-3.68%).

US housing market making progress

US house prices rose modestly to 0.48% year-on-year, with a quarterly rise of 0.55%, according to the Federal Housing Finance Agency’s (FHFA) seasonally adjusted purchase-only house price index. In inflation-adjusted terms, US house prices were still down 2.27% from a year earlier. But this is a significant improvement from last year’s 7.44% decline in house prices.

Increased affordability and a somewhat smaller inventory of homes for sale are positively impacting house prices, says FHFA Principal Economist Andrew Leventis.

Israeli house prices weakening

House prices in Israel were down 4.94% year-on-year to Q1 2012. Prices were hit by worldwide uncertainty, plus measures taken by the Israeli government and the Bank of Israel. The fall comes amid popular protests since last summer over high prices, which have not yet waned.

New Zealand firm, but Australia under pressure

House prices in New Zealand climbed by 0.82% over the year to Q1 2012, after falling 4.79% the previous year. Sales activity has been strong for the last few months, with volumes at the highest levels since 2007.

Australian house prices fell for the fifth straight quarter to -6.04% from a year earlier, the longest downturn for a decade. The central bank has maintained the highest borrowing costs among major developed nations.

Source: Global Property Guide

The Knight Frank Prime Global Cities Index recorded its first quarterly fall since 2009, with the average value of prime property in the world’s key cities depreciating by 0.4% in Q1 2012. This represents the index’s first quarterly fall since the depths of the global recession.

Although a milestone, the index’s negative quarterly growth is not surprising. Quarterly price growth has been below 2% since Q1 2010 and it averaged only 0.6% in 2011.

The first three months of 2012 brought with it little new momentum. The Eurozone’s debt debacle remained at the forefront of the global economic agenda, several critical elections were on the horizon (Russia, France, Greece) and Asia’s highly-effective cooling measures showed no sign of being relaxed. Against this backdrop some luxury buyers took to the side-lines to observe their market’s trajectory.

Despite the overall index’s sluggish performance four prime markets achieved double-digit growth over a 12-month period; Nairobi, Jakarta, Miami and London. Perhaps most surprisingly is the fact that the top five performing cities were spread across four continents – North America to be the only continent to appear twice.

London and Singapore are proof that there is still a level of resilience in the prime markets with both cities shrugging off the introduction of new stamp duties in the first quarter of 2012. In London both prices and applicant numbers increased despite the stamp duty rise to 7% for individuals buying homes over £2m.

In Singapore the new 10% stamp duty for foreign buyers, which was introduced in December 2011, dented demand but not prices according to Nicholas Holt, Knight Frank’s Asia-Pacific research director.

Holt comments, “Prices not only held up but actually increased slightly at the very top end of the Singapore market in Q1 2012. This was not only due to fairly resilient domestic demand, but also due to wealthy Chinese, Indonesian and Indian buyers who continued to buy in this segment of the market undeterred by the surtax.”

In our view the overall index will remain subdued in 2012 fluctuating between marginal price falls and rises (with London, Moscow, Jakarta, Nairobi and Singapore expected to be the strongest performers) but it seems unlikely we are on the cusp of a new deflationary cycle in luxury global house prices.

The safe-haven argument still resonates. Capital flight will continue to focus on cities with low political risk, transparent legal systems, good security and ideally those with an HNWI-friendly (High Net Worth Individuals) tax regime.

The Prime Global Cities Index tracks the performance of luxury property across a selected number of global cities and is produced quarterly.

Source: International Estate Agent Today

Knight Frank Prime Global Cities Index Q1 2012

The global housing market suffered its worst performance for more than two years in the third quarter of 2011 according to UK property consultancy Knight Frank.

The company’s Global House Price Index rose by just 1.5% in the year to September 2011 – the worst level recorded since the second quarter of 2009 with house prices falling in more than half of the countries monitored in the third quarter.

Not surprisingly, Greece was one of the worst-performing countries, with prices falling 4.1% year-on-year. Hong Kong was the strongest, with prices rising 19% over the same period. However the city-state saw its prices drop 1.1% in the third quarter.

“The third quarter saw mounting pressures on the global economy with politicians seemingly helpless to get to grips with the eurozone debt crisis,” said Knight Frank. “This has reawakened fears of a double-dip recession, not just in Europe but around the world. Unsurprisingly, this economic uncertainty has been reflected in the performance of the world’s housing markets.”

At a regional level Europe was the worst performer, being the only area to record a negative growth (-0.5%) while luxury markets continued to hold strong.

“Luxury housing markets appear to be better insulated from this new weaker phase than mainstream markets,” added Knight Frank. “This is due in part to the scale of global wealth generation, the ongoing search for ‘safe-haven’ investments and the growing divide between prime markets in the West and the rest of the world.”

Other notable countries include China, 6th in the table with a 8.9 per cent rise, Germany, 20th with a 2.8 per cent rise, the US, 39th with a -3.9 per cent loss and troubled Greece, which came 40th, with the average house losing -4.1 per cent of its value.

Canada’s housing market fared well with prices up 4 per cent in 2011 compared to the year before. Rising property prices in Vancouver’s housing market have certainly contributed to this.

Global House Price Index

Growing demand from rich international buyers, particularly among billionaires, is helping to create a new global super class of property in some of the world’s most important cities, according to fresh research.

These high-end global destinations continue to defy the wider economic downturn, with property prices in the top ten cities having increased by 10% in the first six months of 2011 compared to the corresponding period last year, the latest Savills Research global billionaire property index shows.

Hong Kong is the most expensive place to buy a home globally in value terms with average property prices standing at £6,700 (Cdn $10,800) per square foot, up 83% from December 2005 to December 2010 and an additional 10% on top of that to the end of June 2011.

In second place is Tokyo at £5,190 ($8,400) per sq.ft., followed by Paris at £3,270 ($5,300) per sq.ft. and London at £3,090 ($5,000) per sq.ft..

There has been significant capital growth in emerging markets. Russia (Moscow), ranked fourth, has witnessed values increase 110% from December 2005 to 2010 and a further 2% increase this year to take it to £2,520 ($4,000). Singapore has seen a 144% and 16% rise, while Mumbai has appreciated 138% and 7%.

The 10% average prime property price growth recorded in the top cities worldwide compares to average price growth of 6% for ordinary properties in the same cities,

Yolande Barnes, director of residential research at Savills, commented: “We recently identified ten world class cities whose real estate markets have more in common with each other than the mainstream markets of the counties in which they operate and they are all attracting billionaire’s dollars, whether generated at home or overseas.

“Global billionaires can make any country their home, and often have several different residences across the globe. Most will seek a base where they are doing business. This has the effect of funnelling global equity into the very best residential real estate, a rare commodity in any city. Billionaire buyers demand the best international standards of accommodation and are paying prices to match, creating a super class of global billionaire homes,” she added.

The Top 10 ‘World Class’ cities are as follows: Hong Kong, London, Moscow, Mumbai, New York, Paris, Singapore, Shanghai, Sydney and Tokyo.

Source: International Estate Agent Today