Category Archives: Lifestyle

Time To Buy A Euro Property Bargain?

Property prices in sun-kissed hot spots in Europe are in meltdown, according to economists, and the recent interest rate cut by the European Central Bank (ECB) could send them lower still.

So is this a once-in-a-lifetime opportunity to pick up that dream villa, or will other factors, such as the falling pound, keep that idyllic place in the sun out of reach?

House prices in Spain, which has a million-strong glut of unsold properties, have already fallen by a third since the beginning of the recession, but will slide by a further 10pc, Goldman Sachs has predicted.

A picture of property markets on their knees, damaged banking systems and a weak economic outlook is persistent across favourite destinations for British holidaymakers and expats.

And the ECB’s cut in interest rates to a record low of 0.5pc, along with its threat to punish banks for hoarding cash, has been dismissed as too little too late to turn around these ailing dinosaurs any time soon.

Albert Edwards, a market strategist at Société Générale, the bank, said: “The eurozone is now only one short recession away from Japanese-style deflation.”

Ben May, a European analyst at Capital Economics, added: “There is a clear risk that house prices have further to fall in Greece, Spain, Italy, Portugal and Cyprus. Households have been hit very hard by the increasing austerity programmes and the need to reduce debts. Credit remains severely restricted.”

He predicted that the French economy would shrink by 1.5pc this year and the same next. Spain will decline by 2.5pc this year and by 1.5pc next, he said.

Mr May added: “It is a similar picture across many parts of Europe, and it will be some time before there is much hope of a return to growth, despite last week’s cut in interest rates.”

But a property price slump may not be enough to attract British investors, not least given uncertainties on the tax front. Taxes have already risen in France, although the prospect of a 75pc wealth tax was abandoned after celebrities such as the actor Gérard Depardieu very publicly left the country in protest.

It is anyone’s guess what pain lies ahead for taxpayers in locations such as Greece and Cyprus.

The prospect of a further weakening of the pound will probably deter many would-be British buyers from taking the risk. Sterling is expected to continue weakening against the euro, leaving British buyers still needing to find more pounds to fund a purchase, even as values slump.

Peter O’Flanagan of Clear Currency, a foreign exchange broker, said: “The currency has already lost a lot of value compared with the euro, although it has gained a little ground over the past couple of months.

“However, if Mark Carney, the new governor of the Bank of England, goes all out for growth, as expected, sterling will weaken further. So whatever you gain through property price falls, you might lose from currency swings.”

Charles Weston-Baker, head of international residential at Savills, the upmarket estate agent, also introduced a note of caution, warning would-be buyers not to expect to pick up a luxury Costa hideaway for a pittance.

He said: “Yes, there are unsold developments, and many distressed sales. But these tend to be unattractive developments, which were never an appealing proposition. Elsewhere, there are significant numbers of owners who would like to sell, but will do so only if they can get a price they are happy with. Otherwise they will hold on.”

A property price index published by The Economist compares values with typical rents and wages and plots the figures against the historical norm. The most recent of these studies suggested that prices in France were 50pc too high compared with rents and 35pc too high against wages. For Spain, the respective figures were 19pc and 21pc.

Playing the waiting and watching game could prove a smart move. Ray Boulger of John Charcol, the mortgage broker, said: “A time will come when prices stop falling and stabilise. Then will be the time to swoop.” Until then, navigate your way through these shark-filled waters with extreme care.

 

Most Common Buyers Compromise Is Their Garden

Buyers will compromise most on their gardens, followed by a downstairs cloakroom, while least up for negotiation is the number of bedrooms. A surprisingly large number will, however, compromise on the location.

A survey of independent estate agents by Move with Us found that nearly 40% of agents noted that the size of a property’s garden is the first thing to be forfeited when buyers were purchasing a new home.

A downstairs toilet is next on the list with 33.5% of agents highlighting that buyers are willing to sacrifice this. Location is third at 15.4%, followed by parking at 9.3% and the number of bedrooms at 2.7%.

The survey also found that the number of property viewings that home buyers completed before buying their new home has also increased. The average number of properties a buyer has typically viewed before buying in the last six months is between 11 and 15.

England’s Most Expensive Street

A terrace of stucco-fronted houses a stone’s throw from Harrods has been named the most expensive street in England and Wales, with a four-bedroom home fetching £12m.

Residential properties in Egerton Crescent in south-west London cost are the most expensive in England and Wales on average, according to a study by Lloyds TSB, with the average home now costing £8.1 million.

Nestled just a stone’s throw from the Victoria and Albert Museum and the shops of Knightsbridge, the street is one of six located in the London borough of Kensington and Chelsea which are all in the top 10 list.

One four-bedroom family home in the street sold recently for £12 million, more than 74 times the average UK house price of £160,879.

House prices in central London have continued to shoot upwards over the past year amid strong interest from wealthy overseas buyers looking for a safe haven amid the uncertainty of the eurozone.

However, some analysts have suggested that a 7pc stamp duty rate which was placed on homes worth over £2 million in the spring could cause the market to cool off slightly next year.

Merton in south-west London also claimed two places in the top 10 list. Parkside, skirting Wimbledon Common, came in second place with an average property price of £5.2 million.

Campden Hill Square in the heart of London’s Holland Park, which was last year’s most expensive street, was pushed into third place this year, with an average price of £4.9 million.

Commenting on the dominance of Kensington and Chelsea, Nitesh Patel, an economist at Lloyds TSB, said: “In recent years, its prime location in central London and classical architecture has attracted affluent celebrities and ultra wealthy foreign businessmen, helping to drive up property prices.

“Across most regions, the most expensive streets are typically tightly clustered.”

Away from the English capital, the most expensive streets include Woodlands Road West in Virginia Water, Surrey, where homes are worth £3.2 million on average and Leys Road in Leatherhead, also in Surrey, where homes have a £3 million price tag.

Outside southern England, the most expensive street is just south of Manchester, in Park Lane, Altrincham, with an average house price of £2.1 million.

The most well-heeled streets in Yorkshire and the Humber are located in the “golden triangle” between Harrogate, Wetherby and north Leeds.

The region’s most expensive streets are Rutland Drive in the spa town of Harrogate, with average prices of £1.1 million and Wigton Lane in north Leeds at £1 million typically.

The most expensive street in Wales is Druidstone Road in Cardiff with an average house price of £682,000, followed by Gannock Park in the village of Deganwy in Conwy, where homes typically cost £636,000.

The study used Land Registry records of sales which took place between January 2007 and September this year.

 

Parking Space In Cornwall To Fetch Over £50,000

With a sea view along a palm tree-lined road in the heart of a Cornish resort, an asking price of £50,000 seems like a bargain – until you realise that it is just for the parking.

Five car spaces in the much-sought after St Ives have gone on sale for a staggering £50,000 each – more than double the average wage in Cornwall.

But the sale has sparked anger among local residents who say they are being priced out of buying homes and land because the value is being forced up by out of towners.

One local councillor said it “sticks in the throat” and is creating a divide between locals on low wages and wealthy second home owners.

The sale of the five parking spaces, which are just a 30 seconds walk from the town centre, comes just three months after another space sold for £55,000.

The town, once famous for attracting the country’s artistic elite including Alfred Wallis, Ben Nicholson and Barbara Hepworth, is hugely popular for both holiday homes and tourists and parking has become a premium.

The appointed estate agent has already received an offer of £100,000 for two of the spaces – but had declined it because each is now going to be auctioned – potentially selling for even more than the guide price.

The sites will pay for themselves because they will push up the price of any house sold in the town that can boast a parking spot.

However, the average worker in Cornwall earns just £22,000 a year.

Andrew Mitchell, chairman of the resources committee at St Ives Town Council, said: “It shows the mismatch in St Ives and many other Cornish villages and towns between the local population on low wages and seasonal jobs and second home owners.

“It’s ridiculous that many of those that live here can’t afford a home. They can’t even afford one of these parking spaces.”

Councillor Colin Nicholls, the deputy mayor of St Ives, has described the sale of parking spaces as a “dinner party accessory” for those who are “awash with money”.

There was outrage in the town five years ago when a parking space was sold for £24,000 but the going rate is now double that.

Around 60 people had already shown interest in the latest spots, which have been created from a former garage site and garden in Barnoon Terrace in the town.

The agent commented: “There is simply not enough parking capacity in the town for the number of people that are here. And there are plenty of people prepared to pay these kind of prices.”

He accepted that the likely buyers would be second home owners and added: “If a house has a parking space in St Ives the values shoots up, so the spaces will pay for themselves.”

The town council objected to the development of the spaces, which included the loss of a hedge, but was overturned by Cornwall Council.

Earlier this year a beach hut on Mudeford Sand Spit, near Bournemouth, sold for £170,000 after being on the market for just two days.

www.telegraph.co.uk