Here we are at the end of the week with a round-up of overseas property news and views…
Our friend, international property lawyer Peter Esders tells us that he will soon have series of guides that we can introduce to members. These will include ‘Buying a property in Spain’, ‘Spanish Timeshare’, ‘Spanish Golden Visas’ and ‘Litigation in Spain’. We’ll keep you posted.
The pound takes poll position! Sterling was its strongest against the greenback since 19 June last week, at 1.5657. How come? First, because UK recovery statistics sent the pound soaring. Second however, the dollar dived, as American industry suffered a sharp and sudden slowdown in July, which could convince Fed head Ben Bernanke to extend his economic stimulus (called quantitative easing). Given this, expect sterling to exceed this eight-week peak against the greenback soon! Exchanging soon? Email back for a free, no-strings chat with Pure FX.
According to recent figures from analysts Core Logic, the US market is shaping up to achieve a balanced recovery. Anand Nallathambi, CoreLogic’s CEO, says, ‘Across the country, pent up demand and continued low interest rates are fuelling strong demand for a limited inventory of properties. We expect that trend to continue to drive up prices throughout the balance of the summer. June home price trends and forecasts were nearly all positive across the country. We saw quarterly, yearly and six month forecasts all tick up, relative to the past few months’ performance. These improved trends signal spring buying activity continues to have a positive impact, while our forecasts point to moderation ahead.’
‘Certainly this is an interesting and important dynamic unfolding and while it could seem contradictory at the surface, perspective lends clarity. Increasing gains are great news for homeowners and to be expected at this time of the year, when home buyers are typically most active. While there is a lot of buzz right now in terms of double digit housing gains, over the long run, we don’t expect to see the current rates of growth sustained. Keep in mind this is really not a bad thing. National growth for all of 2013 is expected to hit 6 per cent, lower than current yearly growth of 8.6 per cent, yet higher than historical norms between 4 per cent and 5 per cent. After more than a full year of recovery, we consider the current momentum and expected moderation a really healthy move toward a more sustained recovery.’
Following on from the news that the exoneration period for capital gains tax (CGT) will fall from 30 to 22 years from 1 September, Budget Minister, Bernard Cazeneuve, says there will be a temporary tax allowance of 25 per cent that will apply to sales between 1 September 2013 and 31 August 2014. Property agent Trevor Leggett of Leggett Immobilier offers a view.
‘The government are determined to boost property sales over the next 12 months. Last year France saw a 12 per cent drop in house sales down to 709,000 and this year we’ll see a further decrease. President Hollande recognises the danger this presents to the wider economy and has acted to halt the decline.’
‘Whilst these changes have still to be ratified by parliament I see this as a formality, although some of the detail still has to be clarified. Over one in ten UK buyers of French property now purchase their homes through Leggett Immobilier and I’m sure that they will be delighted that President Hollande finally seems to accept that the property market is the cornerstone of French foreign investment. We see this as a big step forward for the Hollande government and we are expecting a spike in sales from September onwards.’
Our friends at Pure FX write this week, ‘The pound goes for gold! Sterling hit its highest since 4 July against the common currency last week at 1.1756. Why? Because Britain is back in business with sales in Blighty’s shops soaring a super +1.1 per cent in July, easily exceeding expectations for a +0.6 per cent increase.’
What’s more, -29,200 fewer Brits claimed jobless benefits in July too, bolstering the belief that the UK job market is bouncing back. Given this, prepare for the pound to shoot up sharpish against the euro, as the UK economy at long last hits its stride!’ Email back if you’d like further sterling-euro analysis and outlooks.
We have a new property sourcing agent! He writes, ‘I will say that we will check all complexes and properties out thoroughly before offering them to you, especially the prices, values and locations to make sure there is an immediate equity of at least 25 per cent on current prices and good rental potential.’
If you want to buy in Spain, do let us have your requirements – type of property, price range and area/location etc. Let us have as much information as you can so that we can make sure we only offer you what you are interested in. Please note, serious replies only please.
All for today, see you over the weekend with some property introductions for all you investors out there.