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London Real Estate Hot Spots for High Net worth Individuals

January 23rd, 2010 CheapFlatsInLondon No comments

London is the real estate hot spot for high net worth individuals today even though it is the world’s most expensive place to buy property for residential purpose. Price of properties is as high as over two thousand pounds or over four thousand dollars a square foot! The hike in prices can be attributed to the purchasing capacity of high net worth individuals as clearly indicated by the steep rise in central London properties. Property industry is flourishing, with landmark buildings being sold at premium rates. One such building is the HSBC head office at Canary Wharf which fetched the highest ever price in Britain.
London being the global financial capital, the demand for office spaces is on the rise and attracting buyers from all over the world. Such properties have been fetching high returns for their commercial worth. The rental yields of such property are extremely high. With commercial property prices escalating, residential prices too are on the rise, making the luxury property prices go through the roof. Flats in London cost as high as over four thousand pounds per square foot. The really high prices of luxury apartments in Knightsbridge have turned London’s penthouses into the most expensive residential properties. Another prize address is the Hyde Park area where costs of smart homes have shot up by about fifty percent.
Some of the prize residential places would be featuring bullet proof windows, purified air and even “panic rooms” to take care of security. A squash court and spa would be added attractions in the much luxurious and prestige residences now being made available in central London. The London hot spot real estates for high net worth individuals are a class of their own.
Clients are making a grab for these very prestigious places in the heart of London city, without even viewing the showcased property. Such places are being identified by Russian oligarchs and Arab princes and the prices are booming. The rise in interest rates along with the rise in prices have not deterred the high net worth individuals who seem even more determined to buy such prize property knowing its value in tomorrow’s world.
Considering the rise in prices, it is predicted that home prices in the capital will escalate still further as the demand is outstripping the supply. The only thing about this excessively high range of prices is cordoning off areas as being areas of the ‘rich’ and the high net worth individuals and the other more affordable houses as the ‘poor’. People love the mix of the affordable and the very rich lifestyle.
All said and done, London has become the most prized and expensive place in the world to buy luxury property at the new price record of four thousand pounds a square foot. It is attracting buyers from Russia, India and Asia because of the attractive tax structure which enables them to reside in another country without paying taxes on the money kept there. Bonuses earned by those working in the financial service industry are ploughed in to buy larger and more luxurious homes.

10 Aspects of Good Real Estate Investment Software

December 14th, 2009 CheapFlatsInLondon No comments

Real estate investment software is one of the best tools real estate investors and professionals have at their disposal to analyze and evaluate rental property. Hands down.
Good real estate investment software provides user-friendly forms, makes every computation, and generates professional-style reports. With a good real estate software solution any user (novice or advanced) can create professional-quality rental income property reports for personal decision-making or as presentations to buyers, sellers, colleagues, partners, or to lenders within minutes.
Moreover, real estate investing is all about the numbers. Hence, successful real estate investors concentrate on (nay, make the investment decision based upon) the bottom line when considering real estate investment opportunities. Real estate investment software therefore becomes an essential tool for people who seriously work with investment real estate because it provides quick and concise cash flow and rate of return numbers.
There are, of course, options other than investing in third-party real estate investment software. You can, for instance, simply scratch out the numbers with a pad and pencil, perhaps make a hasty rule-of-thumb calculation off the top of your head, or maybe listen to someone’s advice. But it should be obvious that these approaches, although useful in limited cases, are fraught with weaknesses. They clearly do not provide a deep enough property analysis required for such an important investment decision, nor do they represent the data adequately enough to sway the opinion of any other person, entity, or institution.
Of course, you can develop your own real estate investment software solution on a spreadsheet program like Excel. The problem here is time. It takes loads and loads of time to embed the computations properly and to format the forms and reports. Given the affordability of some software solutions, successful real estate professionals do not waste time or effort reinventing the wheel and rely on real estate software, preferring rather to spend their time generating moneymaking deals.
But I digress. So let’s get back on topic and consider 10 things you should expect to find in good real estate investment software.
1. Easy to learn and use – You want simply to enter the values and have the software do the rest. You never want to look and wonder, “What do I do next?”
2. Unlimited units – You want the ability to analyze one unit or a thousand units, or even more units if necessary.
3. Loan amortization – You want lots of control over the financing assumptions for the property. Therefore you want the ability to enter multiple loans (e.g., a first, second, and third loan), the flexibility to enter the loan either as a loan assumption or as a new loan, and either at a fixed-rate or interest-only rate.
4. Crucial rates of return – You want the real estate investment software to calculate returns for cash flow such as cap rate, gross rent multiplier, cash on cash, operating expense ratio; and loan analysis ratios like debt coverage, loan-to-value, break-even, profitability index.
5. Concise, top-quality reports – You want a wide-range of printable reports to include comprehensive data with eye-catching appeal. Remember, you might be trying to influence the opinion of a buyer, seller, colleague, or lender regarding this property. At the very least, you would expect superior software to create an APOD, proforma income statement, rent roll, acquisition report, and sales proceeds report. If you’re pragmatic, you can also find software with sensitivity and scenario reports, a comparable sales report, a marketing package (executive summary), amortization tables, and charts.
6. Upgradeable versions – In the event that you purchase their less-than-platinum-grade-version without “time value of money” and “tax shelter” consideration, you want the ability to upgrade to it later if you choose. This is crucial. For you will discover over time that time value of money and taxes are extremely important to real estate investors and you will want the software to compute them.
7. Technical support – You want to have easy access to tech support in the event of a problem, e.g., your computer crashes and you need to re-download the real estate investment software. Email and telephone support (preferably with the developer) is recommended. Exercise caution if the company or developer appears overly allusive or lacking in experience.
8. Affordability – The good news is that there is very good real estate investment software available on the web for under $300. Be sure to examine the website carefully, however. Remember, the same software company that’s wanting you to purchase their software publishes the website. Unless it’s well organized and informative, or if its lack-luster and confusing, the software might not be worth the price regardless how affordable.
9. Customer satisfaction – Customers freely willing to write and submit a testimonial about the software should not be taken for granted or lightly regarded. Look for names, professions, and titles. If you can relate, then you’re on the right track.
10. Lots of special features – You should expect good real estate investment software to provide at least these benefits: Seamless printing, picture function, branding and name-rider integration, email capability, help file, and Vista compatibility. In some cases, there could be even more features that are special, so spend time on each website looking around to be sure you don’t miss something.

Plenty of Ways to Make Real Estate Cash!

December 11th, 2009 CheapFlatsInLondon No comments

If you are looking for a quick way to make some cash, then you might want to look into real estate and making some real estate cash. Because of the way the market it is at the moment, there is a real large possibility that you, like others, can make a lot of real estate cash!
For those of you who watch the news, or read the newspaper, you probably are aware of the fact that many people are losing their homes to the bank. This can be a very good thing for people who need to make some money and are turning to real estate! Foreclosures these days can be bought for such a low price and you can turn them around for a large profit and make some serious real estate cash!
The main thing that you need to keep in mind when it comes to real estate and making money is you need to make sure that you have enough in your budget to cover repairs as well as taxes. In order to sell the house and turn it around for real estate cash, you need have the house in tiptop condition!
Once you get started making real estate cash, you can keep on building and buying more and selling more and you can really start to turn this into some sort of small business and use the real estate cash that you make as your actual income. This way you could turn into your own boss, and make the money that you want to make!
If you seriously want to look into making real estate cash and turning old foreclosed homes into some profit then you are going to need as much information as you can get! The more information that you have the better off you are going to be and the more real estate cash you are essentially going to make. After you get all of your information you might want to start building a rock solid plan so that you have an idea of what direction you want to go in. Remember you have control of how much real estate cash that you want to make, so the smarter that you are at it, the better off you are going to be.
So, you have the basics that you need in order to make some real estate cash. You need to have a lot of information and you need to have some sort of plan to get you off of your feet. From there, you are just going to need some funding and then you can begin investing and you can begin to make some real estate cash. It may sound like a hard thing to get into, but the fact of the matter here is, people are losing homes and some people are buying homes. So turn that foreclosed home into a real estate cash cow, and start looking at homes that can make you money!

Innovative Real Estate Investing

December 6th, 2009 CheapFlatsInLondon No comments

In order to buy and sell Real Estate most states require that an applicant take a minimum number of classes before taking the state licensing exam. Real estate brokers and their agents typically do not provide title service such as title search or title insurance and do not conduct surveys or formal appraisals of the property such as those required by lenders. Further, they do not act as lawyers for the parties, although they may “coordinate” these activities with the appropriate specialists.The good news is that there is a way for you to buy and sell Real Estate without becoming a licensed real estate agent or Broker. This would include but would not be limited to Real Estate Foreclosures.Real Estate Foreclosures is one of the HOTTEST INCOME producing streams of all time using LITTLE or NO MONEY of your own. One market in particular is tax sales. Real Estate agents won’t tell you about tax sales because they earn no commissions on these properties. Real Estate Tax Sales are a little known but potentially lucrative way to expand your portfolio.John Beck’s proven Amazing Profits tax deed and tax lien education teaches people how to buy properties for just pennies on the dollar. The Free and Clear Program Course is a must have for anyone looking to get ahead in real estate investing. John Beck is a guaranteed name for real estate business consultancy.His program is primarily advertised via infomercials and primarily runs on late night and cable channels in the United States and Canada. You have no doubt seen his late night infomercials!On his infomercials he repeatedly holds up color photos of houses and states the price at which they sold via delinquent-property-tax procedures. He is well known for his expertise in the real estate business. He has also been a real estate broker, syndicator and real estate consultant who has been listed in Who’s Who in Creative Real Estate. He is a much sought after speaker who regularly conducts real estate investment seminars in both Northern and Southern California and who has spoken extensively throughout the United States and has appeared on numerous radio and television shows as a guest expert on foreclosures.John Beck is constantly sifting through the tax lien and foreclosure information on the Internet to find the most valuable and profitable research available which he puts on his site as a benefit to his students. John Beck’s unique system of researching tax lien and tax foreclosure properties and his long history of studying the foreclosure market gives him insights into properties that others simply do not have and cannot provide. His proven tax lien and tax deed system teaches you exactly how to get your share of the profits this section of the real estate market represents and again, you don’t even need to get a real estate license. The course has a lot to offer to those who come with the pure intentions of growing their business community. John Beck’s, Buy Real Estate Free and Clear for Pennies on the Dollar is a popular website and TV campaign that basically advocates purchasing taxed out properties. He shows you how real estate investors can profit from his free and clear real estate system. John Beck has personally attended thousands of tax auctions around the country and has personally invested in nearly every state. His current experience and his vast knowledge of the tax foreclosure and tax lien market has been developed into an easy-to-read format to make it easy for you to learn John Beck’s incredible method of finding, buying and profiting from tax auctioned properties you buy for just pennies on the dollar. He has been working with real estate for over 20 years and has helped many people just like you accumulate wealth through real estate investment. John Beck’s Property Vault tool has been designed to make finding deals like this easy because you can download the information in Excel format making it a snap to screen for the best deals matching your investment criteria. John Beck’s Amazing Profits Tax Deed and Tax Lien Real Estate Investment System has been created to make it easy to understand what to do in real estate to make big money now. He continues to make unbelievable tools available to his students that makes it even easier to find profits in your investing today.

10 Year-end Tax Tips Every Real Estate Investor Must Know

December 1st, 2009 CheapFlatsInLondon No comments

The countdown from Thanksgiving to Christmas is a magical time of year, but it’s also a warning to real estate investors that December 31 – the end of the tax year – is almost upon us. If you haven’t yet gotten your financial house in order you’re running out of time to gather your records and do some last-minute planning to minimize your tax burden. The good news is, if you start now, you still have time to save yourself some money on the tax bill you’re going to have to pay in April. Here are 10 great money-saving tax tips that will put a warm smile on your face regardless of the temperature outside.

1. Home Office Deduction – If you’re new to real estate investing, you may not be aware of this timeless treasure that the IRS makes available to you. By setting up a dedicated workspace in your home, you can deduct much of the costs of doing business if you work out of your home. In addition, you can proportionally write off some of your living expenses, such as mortgage interest, utilities, and telephone expenses.

2. Mileage Deduction – Sky-high gas prices will really save you money at tax time. You’ll be able to get some of these expenses back, but the standard rate will vary, depending upon when you were driving for business. For the half of the year ending June 30, the deduction is 50.5 cents per mile. Starting July 1 and going to the end of the year, that rate increased to 58.5 cents per mile.

3. Educational Expenses – Did you decide you just had to pick up that investing course, book, or CD set that claimed it would put you on Easy Street in no time? Good news. It’s deductible as long as your purchase was designed to expand your business opportunities.

4. 401K Conversion – Did you finally decide it was time to fly solo? If you quit your job this year, you can convert that 401K plan that’s getting beat up by Wall Street into a self-directed IRA. Not only will it save you money, it will also free up valuable dollars you can use to invest in even more real estate – all with Uncle Sam’s blessing.

5. Self-employed Health Insurance – One of the biggest challenges faced by self-employed real estate investors is how to pay for health insurance once you leave the relatively safe ranks of the employed. This deduction can save you a bundle because insurance premiums are very high.

6. Charitable Contributions – Do you love that warm, fuzzy feeling you get inside when you spread around some of your hard earned cash – and it’s not being caught by a Washington politician? If that’s the case, give to your heart’s content, while enjoying a sizable IRS tax deduction.

7. 1031 Exchange – This money-saving tip can save you tens of thousands of tax dollars over the course of your real estate investing career. When you sell a property for a profit you would normally get hit with a substantial capital gains tax. This technique allows you to defer your tax penalty indefinitely – until death if you like. Use the 1031 exchange to defer taxes you’d otherwise have to pay. While it’s true that “you can’t take it with you”, why should you take the taxes with you?

8. Charrissa’s Mortgage Secret – This technique seems devious, but it’s an entirely legal way to reduce your tax liability. Your mortgage payments are probably due on the 1st of the month. By paying them a day early, not only can you save a day’s interest, but you gain the benefit of being able to deduct an extra month of mortgage interest. How much can you save with this technique? How many properties do you have?

9. Charrissa’s Stalling Technique – If you’re planning on selling a property in December you can save your capital gains liability by delaying the closing until the new year. While not as beneficial as the 1031 Exchange, it still allows you to delay paying the tax for a full year.

10. Early Payment Discount – Will you owe state and local taxes this year? You have two choices: Pay them in January and wait a full year to take your deduction – or pay them in December and deduct them next April.

You may be wondering what to do with some of your tax savings. That’s really your call. You can use it for investing in another red-hot property or you might put it to good use as an extra nice Christmas gift for that special someone in your life, or you might even opt to perform a random act of kindness for someone less fortunate than you. If you play your cards right, you might be able to do all three.

Whatever you decide, enjoy doing it. Smile knowing that the money you’re spreading around is being spread by you – and not being squandered by your Uncle Sam.

Relocating to Vancouver: A Guide to Vancouver’s Economy & Real Estate Market

November 30th, 2009 CheapFlatsInLondon No comments

Vancouver, BC has been named several times over as the “Best City in the Americas” by Condé Nast Traveler’s annual Readers’ Choice Awards. The city also ranked #1 on The Economist’s survey of the “World’s Most Livable Cities” for six years running, and in 2008 was voted one of the best places to live by Mercer Consulting in their “Quality of Living Survey 2008.”Clearly, Vancouver is a very special city. It offers residents breathtaking views of the mountains, inviting beaches, and ample green space. Vancouver has become a premier destination for real estate buyers from around the world. For both personal home buyers and real estate investors, an area’s economy plays a critical role in the decision to buy. They’re looking for an area that can provide a solid base for many years to come. Vancouver has a strong and varied economy that has proven to be resilient in tough times, leaving residents feeling secure today, and hopeful for the future. From major Hollywood film productions to international trade, Vancouver offers its residents employment prospects in every sector.Port Metro Vancouver is the nation’s largest port, and trades more than $75 billion in goods with international partners each year. Such a vibrant trade operation has led to thousands of jobs being created (the number of port-related jobs that have been created across Canada is estimated to be nearly 130,000). In addition, the port also welcomes more than half a million visitors each year who are embarking on cruises to Alaska. These visitors spend their dollars at local shops and eateries, and pour a great deal of money into Vancouver’s economy.Cruise ships are just one way that visitors come to the Greater Vancouver area. With the distinguished Vancouver International Airport located about an hour’s drive from Downtown, tourists from every part of the globe find it easy to get to and from the city. There’s also highway access to/from other parts of the province, as well as border crossings to the United States. With so many visitors travelling to Vancouver, the tourism and hospitality industry continues to be one of the area’s largest employment sectors.Vancouver has also become a well-known destination for Hollywood film and television productions. The city is lauded for its chameleon-like ability to resemble other locales. “Hollywood North” as the city is known, is right behind Los Angeles and New York in terms of film production, which makes this a great place to live if you’re employed in the creative arts.High tech firms love Vancouver because of the availability of highly skilled graduates and the city’s overall livability. Construction also continues to employ a large number of people, thanks to the steady demand for commercial and residential space in the metro area, and also due to the upcoming Olympics.In addition to the city’s excellent economic health, Vancouver is also known for its profusion of educational opportunities. Vancouver is home to two of the country’s top universities, Simon Fraser University and the University of British Columbia. A number of colleges are also located in the area, as well as the Vancouver Film School and the Emily Carr University of Art + Design.For younger students, there are 18 secondary schools, more than 70 elementary schools, and several private schools in the region.In terms of housing, the Vancouver real estate market continues to be strong despite a slump in many other markets around North America.Vancouver is home to some of the most expensive housing in Canada, though prices have been dropping in recent months. While the struggling international economy does play a role in the slowing down of Vancouver’s housing market, property values are dropping more as a result of an inevitable price correction. Housing prices had been increasing at an incredible pace for several years, making real estate in Vancouver inaccessible to a large number of people. According to the Real Estate Board of Greater Vancouver, the price of detached homes increased by almost 70% between 2003 and 2008, while condo prices increased by approximately 82%. Over the past several months, real estate prices have decreased by about 12%. Properties are still holding onto much of their value, which is good news for sellers, yet the market is becoming more affordable, which is great news for buyers.To learn about the unique lifestyle that Vancouver can provide, check out the continuation of this article: “Relocating to Vancouver: Fresh Urban Living.”

Real Estate Investment Property

November 29th, 2009 CheapFlatsInLondon No comments

Land is a tangible investment – you can see what you are getting – but in addition you have the chance to enjoy it for its own sake, with the potential for considerable returns. Land as real estate investment property has risen in value by nearly 30% in the last 12 months and is up by 130% since the early 1990s.Land compares favourably as an investment when compared with high risk stock market picks, making it an excellent real estate investment property opportunity.Land which can be bought affordably can be turned into a real money-spinner if you get the right permissions subsequently. As an example, a plot of land in the South East, bought for £15,000, could gain planning permission for a four bedroom detached house. A builder could buy this land for £200,000 to sell a £600,000 house. This represents an excellent real estate investment property investment.Land has some great advantages:1. There is a finite amount of land2. Land can increase in value in two ways * By increasing property values, as demand outstrips supply * By gaining planning permissions3. There are strong possibilities of exceptional short to medium term returns4. Any nationality can buy UK landRecent government activity with regard to housing has made this a good time to own land. The government wants more green belt land to be built upon to increase the house-building programme over the next ten years. As other investment markets are feeling the squeeze, it is inevitable that land prices will continue to rise in the coming years. Real estate investment property such as land will shoot up in value.The price of land has gone up by a multiple of eight in the last 20 years, with the most expensive land to be found in London and the South East. Prices here have been forced up by a shortage of residential land and an increased need for more housing.In the medium to long term land can be a good investment, but you can make really big money if you buy land without planning permission and subsequently get permissions for that land.So far, since it came to power, this Labour Government has approved 162 different schemes of development of green belt land. Still the shortage of housing continues to increase, with the shortfall predicted to be one million homes by 2022, unless there is a dramatic pick up in development. There is also a shortage of land suitable for development. A recent report said that an additional 70,000 to 120,000 houses per year would have to be built to keep pace with demands.  These facts make land an attractive investment, and prices for land are expected to keep rising as demand for new housing continues to increase.The largest gains can be made when buying land without planning permission, as the land can be purchased at relatively low cost and if the land is later granted planning permission large profits can be made.There are obviously some things to look out for when buying land and such things as access rights, road infrastructure and many other things need to be checked out.Land as real estate investment property has the potential to make big money if you do you homework, and it is also recommended that you use a solicitor when investing in land, to ensure that everything is in order.

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Lake Tahoe Real Estate – an Investor’s Gem

November 28th, 2009 CheapFlatsInLondon No comments

You may know that South Lake Tahoe has become one of the country’s most popular resort destinations. But have you thought about it as an investment opportunity? Even in a challenging real estate market, South Lake Tahoe reigns as one of California’s top-advised real estate investment areas.

In Lake Tahoe’s vibrant real estate market, inventory is approximately twice that of 2005. Median home prices are slightly lower and sellers are negotiating more than ever. It’s a buyer’s market!

Adding to the lure of the area, word is spreading that South Lake Tahoe’s next redevelopment phase is underway and gaining national attention. Most important, though, is the enthusiasm following Vail’s purchase of South Tahoe’s Heavenly Mountain Ski Resort. It’s almost certain that today’s lower values will not last long.

The following reasons are why Lake Tahoe real estate is primed for investors.1) Large Inventory = More Buyer Options. As of August 26, 2007, there were 586 single family residences for sale with 56 currently in escrow. This inventory is considerably higher than the 366/96 reported in August, 2005 (although slightly less than the 594/46 reported August 31, 2006). 2) Affordable Prices. Affordability is South Lake Tahoe’s charm. When compared to other international resort areas, South Lake Tahoe’s median home price of $463,000 is a fraction of those found in Aspen, Colorado ($1,199,700), Vail, Colorado ($791,000) Park City, Utah ($605,000), and our neighbor Tahoe City ($1,001,500.) Likewise, when compared to California’s median home price of $586,030, South Lake Tahoe’s property values are absolute bargains—with the lake, mountains, blue sky and pristine seasons as bonuses.3) Buyer’s Market = Negotiation Leverage. Supply, demand, and consumer confidence have played an immense role in buyer negotiating strength. As is common in the South Lake Tahoe real estate market, when summer begins to wane, sellers become more anxious to sell. In a nutshell, they want to close escrow prior to the first snowfall. As long as inventory is up (more homes for sale), there’s more room for buyers to negotiate the sales price and other accommodations. As an example of this type of leverage, during 2005, the average home sold for approximately 98.5% of the list price. Today, the average home is selling for 95.8% of the original list price. 4) Expansive Redevelopment. Following many years of planning, dreaming and hoping, the next phase of South Lake Tahoe’s redevelopment phase is underway. Rundown motels, shops and similar structures have been demolished to make way for future developments. Some examples of future developments include a 71,000 square foot convention center and two hotel-condominiums featuring boutique shops, entertainment and proximity to nearly all that the South Lake Tahoe Stateline area. Developers are anticipating this project to bring in approximately 180,000 visitors a year.The Time Is Right to Invest In South Lake Tahoe Realty

South Lake Tahoe’s real estate values have generally escaped the dramatic declines that have so adversely impacted various regions of the state throughout the years. According to Leslie Appleton-Young, chief economist for the California Association of Realtors®, “With credit drying up in recent weeks, we expect further weakness in sales over the next few months”. She continued by adding that the sales declines will be driven by both tighter underwriting standards due to the sub-prime mortgage crises and the adverse psychological impact of news and information regarding increases in foreclosures and mortgage defaults.

At the same time, a door seems to have been opened in South Lake Tahoe. According to a recent article in Inman News, one in five economists surveyed predicted a “meaningful” recovery in U.S. housing markets before the second half of 2008. About 38 percent expected a recovery in the second half of 2008, while 42 percent said housing markets won’t turn around until 2009 or later. Our recommendation is to take advantage of the opportunities that will be presented within the coming months.

For us personally as well as professionally, we have found that owning Lake Tahoe real estate is a far more enjoyable way in which to watch your investments grow when compared to other options. When given the choice of sitting on a lake beach and swishing down world-class ski slopes vs. pulling out our hair out watching the stock market, our choice is clear.

Brazil – a Property Investor’s Dream?

November 28th, 2009 CheapFlatsInLondon No comments

With a relatively stable political structure and an enviably healthy economy derived largely from foreign investment into residential real estate and oil reserves, the Latin American giant Brazil is, it seems, bucking the global downturn that is affecting many markets around the world and emerging something of an investors’ dream. In fact, it was named the world’s most significant emerging market in the respected Morgan Stanley’s Emerging Market Index just recently. Beleaguered global financial markets are looking at Brazil’s economy with admiration it seems. 

“Brazil’s central bank believes that it has underestimated the strength of its economy and has moved its previous forecast of 4.5 per cent GDP growth for 2008 up to 4.8 per cent,” says Samantha Gore of uv10, a Brazil property specialist company based in Spain. “Having studied figures just released, which show Brazil’s current GDP to be £749 billion in 2007, up 5.4 per cent on 2006, the official number-crunchers decided that they’d been too cautious.

Brazil does seem to be resilient to the turbulence in the northern half of the Americas, a turbulence which has sent shockwaves across Europe. And, while the Spanish property market is currently down on its luck, Brazil has the very same to thank for making a major contribution to its current fortune.”

Its property market is still very much in its infancy, however. Prices are still well below the £80k mark in most areas and are expected to yield a good rate of capital growth over the next few years as current demand way outstrips supply.

Estimates suggest capital growth could be as much as 20 per cent year-on-year. Nearly eight million new homes are needed to cater for the country’s growing population, but while its cities like Sao Paulo and Rio de Janeiro may be home to the largest number of its residents, it is the north-east region that is seeing a surge in investment property.

Much of the current real estate development is focused on the Rio Grande do Norte region on the north-east coast, and more specifically around Natal, the region’s capital. The city is widely regarded as having some of the finest palm tree-lined beaches and lagoons in the world that stretch for 400 or more miles. The coastline is characterised by a chain of sand dunes, including the Genipabu and Tibau do Sul dunes that have bars and restaurants dotted along their length, and the bays of Pipa and Pirangi. Small resorts are springing up, although the whole area is still new in terms of real estate development.

Uv10 is currently marketing a number of developments in the north-east. Among them, the Quinta da Lagoa resort of 83 high-spec studio, townhouses and bungalows that the company says is ideal for rentals. Located in Tibau do Sul, near Natal, the development guarantees five per cent gross per annum for three years from delivery. “Judging by the figures from its sister resort, Pousada dos Girassois in Pipa, which enjoys 80 per cent occupancy per year, you could stand to make a lot more,” says Gore. “Girassois is one of the most successful developments in Pipa and the value of property for sale in Pipa has doubled in just two years.” Prices at Quinta da Lagoa start from around £45,200.

Around 80,000 new houses and apartments are earmarked for the north-eastern region, especially around Natal, to cater for the region’s growing population and the demand from foreigners for second residences. While this appears a large figure the area is vast however, and development is controlled by the government to protect the environment, adding to the area’s appeal as an investment hotspot. Combine this with the potential for some good rental returns from the region’s increasingly buoyant tourism sector that has seen significant investment in sports and leisure centres in recent years, and you have an area of Brazil that is becoming more and more appealing.

“The property market in Natal is in its relative infancy and the coastline is almost development-free; supply currently lags way below demand,” says Trevor Byrne, GEM Estates’ Brazil expert. “New development is springing up alongside sporting and leisure facilities but the authorities are paying great attention to the environment before granting licenses – aesthetics and stability are of greater importance to them than squeezing every last penny out of every last square metre.”

GEM Estates is currently offering spacious beachside apartments and villas in Tibau do Sul for as little as £75,200 and village apartments in nearby Maracajaú from £45,000. Its Lago Azul development in Tibau do Sul has a frontline beach position with ocean views. There are many on-site amenities, such as pools and tennis courts. So confident is the company in the project that it is offering all clients a seven per cent guaranteed rental return for three years from completion. The company also has Ma-Noa Park in the village of Maracajau, near Natal, which is famed for its on-site aqua park and extensive sports facilities, including a golf course and football pitch. Prices are low and capital growth expected to be high.

“Prices of property for sale in Natal are incredibly low right now but outside investment in infrastructure such as golf courses and a new airport will increase demand for property and inevitably trigger natural price hikes,” adds Byrne. “Being the closest part of Brazil to Europe, thus drastically cutting down flying times to between seven and nine hours from most European cities, Natal has phenomenal beaches, a permanent summer and with year-round rental potential suits both audiences – the pure investor and the holiday-home hunter.”

The whole area, which enjoys a glorious climate, has attracted government funding to protect the natural heritage as well as enhancing the tourist infrastructure. Development work is closely monitored so as not to detract from the area’s natural wonders. Its towns, villages and small resorts are connected by the coastal highway that winds its way through countryside overlooking the bays and dunes, while Natal’s Augusto Severo International Airport has regular flights to and from Europe. A brand new multimillion-pound airport is under construction and is due to be completed by 2010. It will be the largest airport in Latin America. 

Further investment has come though the likes of international sports stars Rubens Barrichello, who is building a motor sports facility in the region, and David Beckham, the force behind a football academy in Natal. The project is timely for when Brazil hosts the 2014 World Cup. The region around Natal is also earmarked for several large golf courses. Projects such as these increase the region’s potential for tourism, and thereby rental income and capital growth on real estate investment significantly.

“The investment in the general infrastructure and tourism in the north-east of Brazil has been significant over the past few years, and is set to continue for the foreseeable future,” says Deanne DuKhan, portfolio strategist with specialist property company Experience International in London. The company is currently marketing a number of new high specification projects, including the Jacuma Beach Resort in Natal where prices start from just £63,700, the nearby luxury beachside resort of Praia Bonita, where studios and apartments start from £39,070 and the gated community of Pipa Paradise, which comprises 128 sizable apartments and villas that offer good value at prices from £61,899.

“The government is committed to developing the area and with the new airport just a couple of years away we feel that property in the Natal area and along this coastline of Brazil offer some of the most exciting investment opportunities we have seen in a long time.”

Residential Real Estate is HOT, Commercial NOT SO HOT

October 25th, 2009 CheapFlatsInLondon No comments

(realbench.net) – Recent real estate reports generalize about the potential recovery of the real estate market, headlines such as “Housing bottom is close”, “Real estate markets start showing reversal in trends”, “Mortgage originations are higher” have been quite common in recent months.  However most of those reports fail to make the distinction between the two real estate sectors – Residential and Commercial.

Although recent data is showing improvement and even the beginning of the residential real estate market bottom, commercial real estate is at the beginning of the down turn.  The lack of distinction in these reports are leading many investors to make the wrong investment decisions; in one hand some investors that have made the decision to start buying real estate again are buying in the wrong sector; on the other hand some investors are missing out on the current once-in-a-life-time low residential property values due to negative news about the commercial real estate markets.

Just like in the stock market sectors matter, investors must dissect current real estate news down to the individual sector.  But information and analysis must reach further; the use of real estate investment software is instrumental in properly analyzing potential real estate investments.  The right real estate investment software both provide an unbiased view of the state of investment, and take the emotions triggered by the unqualified daily news out of the equation.  Equally important is to choose real estate investment software with algorithms and design suited for recent times; real estate investing has changed significantly since the recent crash, thus making old real estate investment software obsolete and inadequate.

The marked contractions in economic activity have forced a correction in the residential real estate market, allowing investors to pick and choose among a vast inventory of record low priced residential properties that seems bewildering in its complexity.  Nonetheless, the pricing data can assist as a screening tool to facilitate the selection of the right investment by weighing the implications of the trends reflected by the data.  Manual analysis of the data for hundreds of potential real estate investments can be excessive and error-prone; the right real estate investment software best suits this task.

Unfortunately the same is not true of commercial real estate, which is just now in the beginning phases of its decline.  Perhaps in two or three years commercial real estate can also be at their lowest historical prices and reaching their bottom like current residential real estate, unfortunately that day in not today.