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Overseas buyer confidence strengthening in Italy
With the euro at a seven year low against the pound and prime prices in some parts of Italy at their lowest level since the financial crisis, buyer confidence is strengthening, it is claimed. According to Rupert Fawcett, Knight Frank’s head of Italian sales, stock levels remain high. ‘As we move into the traditional spring selling season, more good quality homes are coming onto the market. Not only are vendors being more realistic on price but in some cases prices are 30% below their 2009 peak, with even larger margins being observed in areas such as Umbria and Lombardy,’ he said. ‘There is a growing sense that prices have reached the bottom of the curve and that whilst we are unlikely to see price growth in the short term, we are also unlikely to see significant falls. Sterling and the dollar are now at record highs against the euro making a second home purchase in Italy even more attractive to buyers from the UK, the US and increasingly amongst expats who have relocated to Asia,’ he explained. He also pointed out that the European Central Bank’s decision to introduce quantitative easing at the end of January may ultimately lead to a stronger Euro but it has, for the moment, strengthened confidence amongst Eurozone purchasers. The Greek election result by comparison has had little impact on enquiry levels. All of these contributing factors have led to a visible increase in enquiries and viewing numbers. The number of viewings generated by Italian properties on Knight Frank’s website jumped 31% between December and January. ‘This is an indication that recent currency fluctuations and the ECB’s shift in policy is impacting on buyers’ minds,’ added Fawcett. In terms of the focus of demand, the firm has found that Tuscany continues to generate the highest number of viewings and sales, but Liguria, Venice and Rome are also attracting strong interest. ‘The latter two underline the increased interest in city living, with Florence joining this triumvirate. Whilst an improved lifestyle remains the key motivation amongst buyers in Italy, the potential investment opportunity is increasingly a consideration for those looking at a city purchase,’ Fawcett said. He added that apartments provide an easier ownership route without the need for a large capital outlay and minimal ongoing maintenance. Continue reading
Australian office market sees record breaking end to 2014
A record breaking finish to 2014 has kick started momentum in the Australian office market in 2015 with demand and deals on the rise, according to a new report. Indeed, enquiries for the December 2014 quarter were up 75% compared to the December 2013 quarter and the greatest demand was for space 3,000 square meters and above, with this market up a record 173% on the December 2013 quarter. For the full calendar year, Australian business enquired about 2,256,814 square meters of office space in 2014 compared to 1,813,540 square meters in 2013, a national increase of 24%. Simon Hunt, Colliers International managing director of Office Leasing, said this points to improving business confidence and 2014 also proved to be a successful year for transacting deals, with the number of leases negotiated up by 28% on 2013 and the amount of space transacted also up from 2013 by 34%. ‘All markets, with the exception of the ACT, saw an increase in the number of deals and area transacted compared to 2013, with Victoria adding almost 100 extra deals to its 2013 tally,’ he explained. Throughout 2014, a standout performer for number of enquiries and amount of space enquired for was the information technology sector. This sector is expected to also be at the forefront of white collar employment growth in the year ahead, along with the business services and financial services sectors. ‘In 2015, white collar employment forecasts indicate that business services and financial services will show strong demand for office space over 1,000 square meters, pointing to strong short term demand for larger, open plan workplace environments and less decentralisation of employees occurring,’ added Hunt. Tenants returning to CBD markets was an emerging trend in 2014, and is anticipated to continue as corporates seek central locations, close to amenities to house their administration staff. According to Deloitte Access Economics’ respected White Collar Employment forecasts, the top five growing office sectors that will lead tenant demand nationally in 2015 will be Business Services, IT, Financial Services, Health and Accommodation services. ‘Based on the net growth in jobs for these sectors, of between 10,000 to 14,000 employees, over 150,000 square meters of space will be required to meet space demand,’ Hunt said. Simon Crouch, Colliers International national director of tenant representation, agreed that the IT would be a sector to watch in 2015 as while the majority of corporate tenants would remain cautiously optimistic, IT would be one sector which was in expansion mode. ‘This will continue in 2015 until there is some more certainty in global markets. In the year ahead, we are likely to see a continued restructuring or consolidation of space, in particular in the professional service sectors,’ he explained. ‘Some businesses will grow, but pressure on margins is going to ensure that the leaders of these firms will continue to look for opportunities to reduce their overheads and, as a result, cost of space,’ he added. Continue reading
Asking prices already rising in some parts of the UK
Encouraged by last year's positive property market performance, sellers' asking prices are already rising quickly in London and the South East of England, according to the latest index report. Asking prices are up 0.8% overall in England in Wales in the last month. But the average annual growth fell to 7.1%. Prices are continuing to fall in the prime property market in London. The February asking price index from Home.co.uk also shows that price rises are on the up in East Anglia and the West Midlands and optimism also abounds post referendum in Scotland, where prices have jumped 1.9% in just one month. Not all regions, however, share the same upbeat sentiment. Prices are essentially static in the East Midlands, Wales and the North West, whilst in the North East, they dropped by 0.9% over the last month. Elsewhere, small price rises were observed in the West Midlands, Yorkshire and the South West at 0.7%, 0.2% and 0.2% respectively. The typical time on market for England and Wales is now 125 days, which is 18 days less than this time last year and the data also shows that supply of property for sale nationwide shows a significant uptick. Some 19% more properties were placed on the market this January than in January 2014. Greater London leads the way with a 51% increase in supply, ahead of the South East with growth of 28%, Scotland up 19% and East Anglia up 18%. According to Doug Shephard the firm’s director, high prices are encouraging potential vendors to commit. ‘Although there are clear signs that supply is beginning to outpace demand in London, as indicated by a rising median time on the market. Londoners may be attempting to cash in, but further supply will only serve to ensure a deeper correction in prices in the capital,’ he said. He pointed out that this year rising supply will make its presence felt in London and the South East, thereby placing downward pressure on prices. ‘These regions are much further on in the economic cycle than the northern regions, where price recovery remains as yet elusive. It is conceivable that we will witness a reversal of fortunes in the latter half of 2015 or beginning of 2016, wherein prices fall in Greater London at the same time as they finally rise in the North, as investors target better value regional markets,’ he explained. He believes that the best prospects for growth this year probably lie in Middle England in regions such as East Anglia, East Midlands, the South West, West Midlands and perhaps Yorkshire. ‘It may be argued that these regions are still in the throes of the recovery phase, as supply remains low and prices have not yet risen too far,’ he said. The worst growth prospects are most likely to be in prime central London, where an abundance of unsold stock is whittling away at property values. ‘For the time being, the mmminvestment outlook for… Continue reading
