News and analytical reports of the week (28.06–04.07.2010)

July 13, 2010

SAR: FIFA World Cup pushes up housing prices. Germany: more major investment transactions are concluded in the country. Egypt wants to build a "twisted" skyscraper.

Prices

United Kingdom: In June, average residential property values have only climbed up by 0.1%, compared to the preceding month, up to £170.1 thousand (€205.8 thousand). In yearly comparisons, prices have declined by 8.7%.

South Africa: In June, index of local home prices has increased both in monthly and yearly terms. Growth of housing prices is fuelled by active development of national economy, as well as interest in local property, which is associated with the World Cup 2010.

Turkey: in May, residential property sales have decreased by 0.1%, compared to April. Rentals have climbed up by 0.2%. The index is based on analysis of property sale and rental prices registered in seven major provinces.

Estonia: over the period from January to June 2010, residential property in the country has averagely appreciated by 7.5%, up to €739 per a sq. m. In comparison to the indicator’s lowest point registered in July 2009, Estonian property values surged by 18.4%, on the average.

Investment

Over the first half of the year, investment in German multifamily residential buildings has decreased by 4.7%, compared to the preceding half-year, down to €2.1 billion. At the same time, the number of large transactions (involving over one thousand properties) has increased to nine deals. Five of them were concluded by foreigners. For comparison, 11 such deals were concluded in 2009, two of which were accounted for foreign investors.

Taxes

Tax on residential property is about to be introduced in Cambodia. Taxes will be levied on properties priced more than 100 million riels ($25 thousand). Totally, there are nearly 180.000 units subject to this tax. The tax rate will work out about 0.1%, of the property’s value.

Construction Projects

Cairo wants to build a multipurpose project called Space-Scraper, which represents three “twisting” towers, rising from one basement and connected by spherical wellness center. The latter includes a spa, swimming pools and fitness facilities. First seven floors are reserved for restaurants, cinemas and shopping facilities. First tower will be used as an office building, the second - as a five star hotel. The third skyscraper will become an apartment building. The volume of investments in the project and its schedule are not specified, and currently it exists only as a concept.

P.S.

ING Groep NV company - sponsor of the Netherlands national football team - have benefited from the team’s loss. The company insures boathouses “parked” in canals of Amsterdam. In case, if the national team would have defeated Spain in the World Cup 2010 final, frenzied fans could’ve damaged these homes. Such “riots” took place in 1988, when Dutch players became European champions and sailed through Amsterdam canals upon arrival. Fans wanted to come closer to their idols and jumped on roofs of boathouses, which currently cost more than 300.000 euros. These events are still fresh in the minds of insurers, who had to pay for the restoration of dozens of similar properties.

American rapper, Snoop Dogg, turned to Liechtenstein’s realtors with a request to rent the whole country in order to shoot a video for his new song. But the deal fell through because, according to local estate agent Karl Schwaerzler, Snoop’s managers “did not give us enough time to obtain all necessary permits”. The overall area of this dwarf state, with a population of 35.000 people, which is located between Austria and Switzerland, is only 160 sq. km. The amount offered by musician for the rent of the whole Liechtenstein is not specified.

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