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Posted in General information by Dipen on March 4th, 2010
I visited Cyprus on Wednesday 17 February for 3 days, basically for a catch up on QBP.
But first things first. I landed at the new airport and what an impressive structure it is. It would not be out of place anywhere in the world. The intention was certainly to create a far more positive impression of the island when you first land, and judging by the comments of the people around me it was achieving that objective. Secondly, the new offices of The Quality Group are similarly impressive, and should give us all confidence that they also view the future very positively.
As ever, the weather was warm and pleasant, but this masks the truth for the previous few months. As we all know, Cyprus has desperately been in need of rain for several years now, and at last, substantial rainfalls have arrived. In fact, the wettest January for many years saw 146% of the usual rainfall for the month falling on the island, continuing the rainy trend of the previous 3 months. The salt lakes around Larnaca were full, with the land displaying a green hue not dissimilar to our own pleasant land. I have never seen the island so green and what a wonderful sight that was. The dams high in the mountains are nearly 60 to 70% full, and I am told that there should not be a water shortage for at least the next two years, even if there is no further rainfall. Compare this to dam levels of around 20% this time last year, and you will see how much rain has fallen. Hopefully, water shortages will also be a thing of the past as more desalination plants come on line.
Obviously, having so much rain in such a short space of time also creates logistical problems. Much of the construction activity on the island has been hampered by the rains, but things seem to returning to normal now. The QBP project continues to progress, with the foundations and groundworks continuing. This really is a monumental civil engineering project and we need to devise a method to keep you up to date with its progress. For example, the engineers on site are currently pumping 400 metric tonnes of water AN HOUR from the site as they dig the foundations and put in the supporting columns. These columns will be 15 – 20 meters (around 60 feet) underground, and there will be approximately 200 of them to support the building!
There is now a lot of local interest in the project, and discussions with the financing bank are nearing finalisation to issue mortgages to all investors, along similar terms as originally envisaged. I should be able to report to you on this in the next month or so.
As we all know, the last 18 months have been the most challenging financial conditions any of us have faced. However, although I am sure 2010 will continue to throw difficulties at us, this project is still on track to deliver an outstanding building and investment to us and I will keep you in touch with its progress on a regular basis.
In the meantime, if you have any queries then please do not hesitate to contact any of us.
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Posted in General information by Carl on May 22nd, 2009
I know quite afew of you have been following the progress of Q Well Being (the world’s first purpose built accessible holiday home complex), well now it has its own website and blog. Plese visit www.qwellbeing.com and follow the launch there. Happy reading!
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Posted in Financing by Ash on March 12th, 2009
Breaking news just out is that the number of mortgage loans issued to people buying a new home in the UK has slumped to a new record low.
Just 23,400 loans were taken out in January – that’s 28% down on December, according to the Council of Mortgage Lenders.
Year-on-year the figure was down 51%. Activity in the housing market is all but drying up.
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Posted in Developments by Ash on March 11th, 2009
It has been reported in the last few days that the number of new homes being built in England looks set to fall to an 88-year low.
The National Housing Federation has stated that it expects only 70,000 homes to be built during 2009/10, half the 140,000 properties that were expected to be built this year.This is the lowest level since 1921, excluding the years of the Second World War.
A separate report by the Institution of Chartered Surveyors says UK property sales between December and February remained at their lowest level in at least 31 years. Just nine homes were sold per surveyor in the three months, the lowest since the Royal Institution of Chartered Surveyors’ (Rics) survey began in 1978.
Around two-thirds of the homes will be built by housing associations, as private builders suspend developments until the market picks up, the NHF report says.
This is a long way short of the government target of 240,000 homes being built every year until 2016 with three million new homes being created by 2020.
So supply has or will soon dry up but have the buyers? OK so the amateur BTL investor have had their fingers burned and will not return to the market any time soon but I believe that the “other” buyers, i.e. the end users have not but what has happened over the last 9 months is that the finance has. We expect to see a plethora of initiatives from the now Government owned or majority owned banks in the coming months to provide usable finance. So where will that leave us? Restricted supply and increased demand which will lead to an increase in prices!
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Posted in Financing by Ash on February 24th, 2009
We have been all too aware of the dearth of sensible mortgage schemes available for buyers of Cyprus Property in recent months. The schemes on offer in recent months have seen interest rates around 8% with no sight of a payment holiday for off plan purchases and Loan to Values being limited to no more than 70%.
There have been many false dawns but we note with interest a scheme that has just been announced by the Bank of Cyprus. It offers an 80% Loan to Value and provides a two year payment holiday for off-plan purchases. The interest rate is also capped at 5% for the first three years. Now this scheme is only available for Cypriot residents but I would take this as a sign that things are slowly returning to normal and we would expect similar schemes to be rolled out to non residents in the coming months as more banks reenter the market.
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Posted in Financing by Ash on February 13th, 2009
It was announced today that the number of mortgages taken out by house hunters fell to its lowest level since 1974 during 2008. The Council of Mortgage Lenders numbers show that just 516,000 mortgages were taken out for house purchase last year which is a fall of 49% compared to 2007.
Net lending, which strips out redemptions and repayments, for all types of mortgage also dived sharply, dropping to £39.7bn in 2008, from £108.2bn a year earlier. There was also steep fall in the number of first-time buyers getting on to the ladder. Just 194,200 people bought their first home in 2008, 46% fewer than in 2007. That slump in first time purchases continued in December, with just 12,100 people taking out loans collectively worth £1.4bn – the lowest levels since the CML’s monthly records began in 2002.
So those are the hard numbers but what does it mean, as I guess the headline is not that much of a surprise to many! The reality is that the shortage of mortgage funding and reduction in the number of active lenders has reshaped the mortgage landscape in the space of a year. I don’t expect many of the currently hibernating lenders returning to the market any time soon if at all!
So we are in a position where the few lenders that remain can pick and choose what business they want to write and close their books as soon as they achieve relatively modest targets. I suspect that overall 2009 will start painfully slowly and then things will pick up at the tail end of the year, leading to a further overall contraction in the market.
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Posted in Markets by Carl on February 9th, 2009
The government has finally approved the creation of fourteen new golf courses in Cyprus, which will bring the total number on the island to seventeen. To conserve water each golf course will be required to have its own desalination unit, which must be powered from renewable energy sources.
Spokesman for the Cyprus government, Stefanos Stefanou, said the actual decision had been taken by the previous government.“It was taken for the purpose of strengthening the tourism product in Cyprus and boosting economic activity,” he said.
It is expected that courses will be built in the district of Limassol at Ayios Ambrosios, at Paramali and Fassouri, at Polis Chrysochous, in Paphos and Ammochostos-Larnaca. (Tersefanou near Larnaca has already been given the go ahead)
The story builds!
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Posted in Markets by Carl on February 6th, 2009
Abu Dhabi property on Al Reem Island seems to be bouyant again. A friend who is there at the moment says prices have moved up 8% in the last month. As you will know I’m a big fan of this market, especially the first phase of Marina Square. Demand is strong and supply is very very limited, which are just the right conditions for both a yield and capital growth play. This is a long term investment proposition.
I’m out to Abu Dhabi on 10th March to understand the finance situation (which appears to be easing with more liquidity entering the market via government capital injections) and set up an office! I’ll let you know how I get on.
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Posted in Financing by Ash on February 6th, 2009
Well the Halifax stats that were released yesterday certainly made me sit up and take note. House prices ROSE, yes ROSE by 1.9% during January, and brings an end to 10 consecutive months of price falls. But should we believe them?
I’d like to. My house, like many I guess, has spent the last 6 months in freefall. Luckily I don’t have to sell it and hope that in a few months time it will pick back up again. But realistically it may not happen for years. I see little sales movement in Greater London and the majority of people that I speak to think that whilst prices may not have that much further to fall that they will not be heading upwards any time soon.
However, the number of optimists is starting to grow. However, as noted in my previous post, figures from the Bank of England show mortgage lending rose in December from the previous month. Last month the Woolwich launched its cheapest ever mortgage.
Also the Royal Institution of Chartered Surveyors says it’s seen a jump in new buyer inquiries. It also reports anecdotal evidence suggesting that recent interest rate cuts, combined with house-price falls, are beginning to tempt first-time buyers back into the market.
We seem to be entering a period of “data confusion” with different data giving conflicting messages, perhaps an early sign that we are nearing the bottom certainly with regard to the housing market.
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Posted in Financing by Ash on January 30th, 2009
These lending figures come as a surprise in a week of gloomy economic data.
Net lending, which strips out redemptions and repayments, doubled to £1.9bn during the month – the biggest rise since July 2008. The number of mortgages approved for house purchase also increased after hitting a new record low in November. Approvals were at 31,000, up from 27,000 during the previous month.
Sterling immediately leapt at the news, pushing the euro below 90 pence for the first time in eleven days.
The increase is all the more surprising as activity we would normally expect activity to tail off if December in the run up to Christmas. However, lending is still considerably down on the previous year, with December’s figure only a quarter of the level seen 12 months earlier.
While the data may be a sign that banks are gradually becoming more prepared to lend, mortgage lending levels are still very weak. We await mortgage data for the coming months with interest.
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