Elite properties loose their ground. 2009 first days trend (1-11.01.09)

Very few people in the beginning of 2008 could assume that premium-class housing of London, Manhattan or Dubai will decrease in price. Quite the contrary: many experts agreed that exactly premium-class properties will manage to resist global financial and economic crisis. However the end of 2008 brought news of an opposite sense.

Thus, the average price of a 3-4 bedroom villa in Dubai luxurious area Jumeirah Islands has decreased from 10,5 million to 6 million dirham ($2,9 million and $1,6 million respectively) in September-November, 2008. Housing prices for more expensive properties in the same area, where largest national developer Nakheel operates, fell approximately by one third.

Besides that, residential property prices in Jumeirah Park - another elite area of Dubai - fell by 40%. According to local experts the reasons behind such a sharp decline are:
- Oversupply on Dubai property market;
- Reduction of demand due to mortgage credits low availability;
- Lack of monetary reserves in Dubai’s banks.

The prices for elite housing in Manhattan, New York’s luxurious area, failed to resist the world economic crisis. Average property prices in Manhattan have remained on a 1.5-million-dollar-level during 2008. However, according to Dottie Herman, chief executive of Prudential Douglas Elliman, cost of existing elite apartments fell by 4 % in the fourth quarter. Average prices of units that are under construction fell by approximately 20% since August, 2008.

In concordance with Herman’s forecasts the overall level of Manhattan’s property price reduction may work out 20-25 percents in Q1, 2009.
Cost of premium-class housing in the most prestigious areas of British capital declined in 2008 by the most in more than three decades, reports the London-based Knight Frank. The average price of an apartment or a house in the Mayfair, St John's Wood, Regent's Park, Kensington, Notting Hill, Chelsea, Knightsbridge, Belgravia and South Bank neighborhoods of London fell by 17.2% in 2008. It should be noted that the Knight Frank index mostly covers homes priced not less than a million pounds.
Experts relate the decline of demand for central London prime-class properties to the global financial crisis which could cost the City 60,000 jobs in banking, finance and insurance by the end of 2010.

However, rephrasing a famous proverb, “the elite property is never empty”. It was successfully proofed by a group of London squatters, who, after being evicted from a 6-million-pound house in Mayfair neighborhood, have immediately moved to a 22-million mansion right across the street. It should be noted that the Central London County Court demanded more evidence from the homeowners and has adjourned the eviction case till the end of January. Until then a group of three squatters known as “Da! Collective” may enjoy their life in the mansion.

It must be said that the premium-class housing prices are not in a global decline. For instance, regardless to a square meter in a prestigious neighborhood of Belgian Antwerp (3,000 euro) some lofts, located in the old port districts (Eilandje neighborhood), are being sold for 4635 euro per a square meter. Main attractions of this place are: close vicinity to the historical center of Antwerp (ten-minute-long walk) and a marvelous view on a bay.