Euro Woes Boost London Property
An influx of overseas buyers is now boosting the prime London property market as they seek to escape the eurozone crisis and acquire assets while exchange rates remain favourable.
According to the November Prime Central London Index from Knight Frank, it is indicated that the number of GBP10m-plus houses sold in Londond has risen by more than 500% ever since July, with foreign buyers accounting for 56% of those purchases.
Goldman Traders Leave
Goldman Sachs took a step closer to closing down a core part of its proprietary trading business when KKR hired 9 traders who invested the Wall Street bank’s own cash.
Head of Goldman’s principal strategies desk in New Yor—Bob Howard will take his own team to KKR in the next January.
Mortgage Figure Hits a Nine Year Low
Figures indicated that the mortgage lending rose at its slowest rate for nine years last month as housing market activity remained subdued. The British Bankers’ Association said that net lending, which strips out redemption and repayments, was £1.83 billion for April, the lowest increase ever since February 2001.
Economists speculated that the figure may signal the housing market recovery has run out of steam.
Redrow Predict to Move out of Red
Redrow predicts that it will move out of the red for the very first time in the three years due to the slight recovery in the property market.
The flintshire-based house constructors, which saw losses of £8.7 million in the last half of 2009, is expecting to complete more than 2500 sales in 2010, which is up on the 2113 in its last financial year.
Investment in Commercial Property across Europe Indicate 42% Rise
Commercial real estate investment has risen 42% in Europe in the past quarter, compared with the previous quarter to the highest level ever since the collapse of Lehman Brothers in 2008. According to the property consultancy, more than €25.7bn of property deals were done in the fourth quarter of 2009, which doubled the levels being traded in the first two quarters of the year, according to CB Richard Ellis. This is the highest quarterly trade ever since the collapse of Lehman Brothers and the beginning of the sharpest point of the property slump. The data support anecdotal evidence of a rush back to property investment by a range of institutions after a bounce in values in markets such as the UK ever since the summer. The rise in fourth quarter activity brought total 2009 turnover to €70bn, still lower than the €121bn recorded in 2008. Almost every European market saw an increase in investment activity in the fourth quarter. The UK took by far the largest share of the new investment, with more than a third spent on British property. Investment in the UK rose 64% in the second half compared with the first six months of the year. The next largest market was Germany, which accounted for about 15% of investment activity. The fourth quarter is generally one of the busiest periods owing to the rush of deals being completed towards the end of the year, although CBRE said the turn round was expected to be sustained into 2010. The upturn in investor interest began in the most important European markets but was spreading further in the region. The strongest growth occurred in central and eastern Europe, an area traditionally seen as higher risk than more established markets in western Europe, though the pick-up came from a lower base. There was also significant increase in cross-border investment in the second half of the year. German open-ended funds alone spent more than €1bn in December, with at least 13 acquisitions across seven markets. Sovereign wealth fund from outside Europe also contributed to the rise in activity.
Bargains on Property Earlier This Year
The darkest and coldest days of the year often offer the best home-purchase opportunities, especially for first-time buyers. Whatever house-value experts say, whether the long-term graph is rising, falling or standing still, home prices nearly always rise around Easter, so there are bargains early on in the year. Few people want to move in winter, so those who put their homes on the market at this time are generally keen to sell.
Hopes Rise for Houses
People bullish about UK house prices outnumber the bears five to one, according to a survey of consumer confidence by Rightmove. 56% of respondents expect house prices to rise in the next year, against 11% predicting falls. The bottleneck in supply could continue, with only 5% saying now is a good time to sell.
The findings show a dramatic turnaround from the first quarter of 2009, when 69% of respondents foresaw price falls.
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