Luxury Real Estate

Courtesy of: Carl Peralta of 77 Great Estates

BUSINESSES IN MALTA DO NOT TRADITIONALLY TURN TO THE STOCK EXCHANGE TO RAISE CAPITAL, BUT THE TIDE HAS CERTAINLY TURNED IN 2009 WITH A RECORD €290 MILLION WORTH OF BONDS ISSUED THROUGHOUT THE YEAR. CLAIRE AZZOPARDI DIGS DEEPER AND FINDS OUT WHAT LED TO THE BOOM ON THE BONDS MARKET AND WHAT IS EXPECTED TO HAPPEN NEXT.

For anyone who follows the local business news, the developments at the Malta Stock Exchange throughout 2009 must have certainly made for an interesting read. Despite the fact that the local business community does not usually turn towards the stock exchange as its primary means of raising capital, the last year seems to have brought a sharp turnaround in this trend with a record €290 million new corporate bonds being issued.

Even though this figure is a mere drop in the ocean when compared to capital raised through bank loans, it is the largest amount of money ever raised by companies in Malta through the stock ex-change. Edward Rizzo, Director of Rizzo Farrugia & Co Stockbrokers, observes that “this is a very positive development, although it has taken many years for the corporate bond market to register such growth and provide companies with another source of funding as opposed to customary borrowing from the bank.”

But perhaps the massive surge in the bond market should not come as a surprise. The historically low interest scenario following the sudden deterioration in global economic conditions by all major central banks, including the European Central Bank has had a remarkable negative effect on the returns earned on deposits held at banks. As a result, the demand for more rewarding investment options rose by a large number of investors, and with this increased demand, it suddenly became much more lucrative for private companies to raise the capital needed by issuing bonds on the stock exchange.

But this also begs the question ‘where is the money coming from?’ One may almost expect that during a recession, potential investors may not have a great amount of money to invest. However, the fact that the Maltese traditionally have a high propensity to save, could mean that many are still in a position to invest.

The safety offered by depositing cash at the bank may not be enough of an incentive to override the riskier, but potentially more rewarding, rates offered by the corporate bond market. Even though this may certainly be the case, Dr Cordina emphasises the fact that it is “quality companies that issue quality bonds will attract investment.”

This seems to indicate that while Maltese investors are showing a keen interest in investing in stocks bonds and shares, they display a tendency towards being risk averse and will carefully select their next investment.

Mr Rizzo explains that in 2009, ten individual private companies issued bonds on the local stock ex-change. He continues to explain that investors’ increased interest in bonds has also spilled over to the ‘secondary market’, with an increasing number of bonds being traded on a daily basis. “An increased awareness of the bond market was sparked when three new bond issues came to the market simultaneously in September – Corinthia Fi¬nance plc, Island Hotels Group Holdings plc and Melita Capital plc – which attracted a great deal of attention from potential investors,” he says.

Dr Gordon Cordina, a well known economist, explains that “in this time of economic crisis, various operators around the world are trying to sell quality bonds at a good rate which is favourable to the investor, and there is a strong demand for it. Take Microsoft for example… this is the first year that this massive global company has turned to the bond market.” “

The current trend is for companies to issue long-term bonds at a low interest rate, but the quality of these bonds is of paramount importance. This trend has also been reflected in Malta, within the limits of the domestic market. The fact that the domestic market had a high liquidity rate was also beneficial for the local bond market, but it is only quality companies and bonds that are likely to enjoy success in this regard,” he emphasises.

Yet another point that may be having a positive effect on the local bond market is linked to the negative experience that a number of local investors have had with some international bonds, including Lehman Brothers. Losses made through investments that lost substantial value during the economic crisis may even have enhanced the attractiveness of investing in local companies, as fluctuations and developments can be closely monitored and responded to in a timely manner.

Interest rate levels are often a double edged sword – while the cost of borrowing may be ‘cheaper’, investing in the bank was no longer an attractive option. This is most certainly one of the main reasons why the local bond market experienced such a surge throughout 2009. Companies and investors that were traditionally more inclined to turn to the banking system for financial support and investment options have increasingly started to turn to the stock market for investment and capital raising opportunities. The role of the stock exchange acting as an efficient intermediary, by facilitating the flow of capital and investment thorough the right channels has started to work more smoothly, and an increased flow was highly evident in recent months.

However, although the bond market has attracted a large inflow of funds in 2009, the same cannot be said for equities.

Mr Rizzo explains that share prices fell by approximately 16 per cent in the first quarter of 2009, hitting a low towards the middle of April. “This was not particularly surprising, as the economic recession has had a massive impact on investor sentiment, as well as financial performances of various companies. An encouraging recovery has been registered, and even though the rate of this recovery in Malta is still lower than that registered in other international markets, we are expecting this positive trend to continue to the end of the fourth quarter and beyond,” he says.

Mr Rizzo explains that four companies in particular have performed well. “Bank of Valletta’s performance has been remarkable – the company’s shares registered an increase of 30 per cent from the beginning of the year. HSBC was another good performer with an increase in share price of 14 per cent, while GO also registered a 10.7 per cent increase. Unfortunately, many of the other companies having shares listed on the stock exchange are still in negative territory,” he concludes.

These intriguing developments on the local and international stock markets will surely be followed closely by all economic stakeholders with government, investors, banks and even the general public using the trends registered within stock markets as an indication of future trends in the economy. Expectations for 2010 are high… perhaps 2010 will be another fruitful year for the Malta Stock Exchange?

COMPANY ISSUED VALUE OF BONDS

Bank of Valletta plc € 50 million

Corinthia Group of Companies € 25 million

Fimbank plc € 30 million

Gasan Group of Companies € 20 million

International Hotel Investments plc € 35 million

Island Hotels Group Holdings plc € 14 million

Melita plc € 25.9 million

MIDI plc € 40 million

Mizzi Organisation € 30 million

Tumas Group € 25 million

For further information, kindly contact 77 Great Estates on (00356) 2125 2455; (00356) 9944 7444; skype: info.77greatestates or info@77GreatEstates.com.

Courtesy of: Carl Peralta of 77 Great Estates

The goal of giving form to a complex situation like the credit crisis is to quickly supply the essence of the situation to those unfamiliar and uninitiated.

For further information, kindly click here .

For further information, kindly contact 77 Great Estates on (00356) 2125 2455; (00356) 9944 7444; skype: info.77greatestates or info@77GreatEstates.com.

Courtesy of: Paula Maia of O & O

Property has regained its popularity with high net worth investors who plan to raise their exposure to the asset class, according to a survey by Barclays Wealth and the Economist Intelligence Unit.

The survey found 35 per cent of investors plan to hike the property allocation in their portfolios over the next two years, double the 17 per cent who planned to reduce it over the same period.

Enthusiasm for property has sunk since property values tumbled, but demand may have been revived by the massive injections of money into economies via central bank rate cuts and other fiscal measures taken by governments.

Investors in nine of the 10 biggest markets are planning to increase their property allocation over the next two years, the survey found. Internationally, nine in 10 investors planned to hike their portfolio allocation by 1-4 percentage points.

“The tumble in property values has shaken even the most seasoned investors’ confidence. Despite this, these findings suggest that investors believe we are approaching the beginning of the end of the downturn. It appears that those surveyed are prepared to not only exploit undervalued opportunities, but also to commit further to property over the next two years in the belief that they will benefit from favorable returns," said Rory Gilbert, head of UK high net worth, UK & Ireland Private Bank at Barclays Wealth.

 

Courtesy of: Frederick Peters, President,  Warburg Realty

2009 charted a unique, decade-defining trajectory through the world of New York real estate. It began deep in the doldrums, with mounting inventories and sinking prices, and ended 180 degrees away, with diminishing inventory stabilizing prices. And it was quite a wild ride in between!

As the year began the economic news was dire. Prices were falling and throughout the fourth quarter of 2008 there were few active buyers. With the financial system seemingly dysfunctional and a new President waiting to take office, everyone held their breath. Government funds, though injected in vast quantities into the banks, neither eased credit nor allayed public anxiety. And so, as real estate brokers, we waited. Buyers were sure the market had further to fall and many offered 30% or 40% below asking price; sellers couldn’t quite believe that they had missed their moment and were not ready to accept the new reality.

At many new developments, buyers threatened to walk away from their deposits on properties contracted at the height of the market but now being paid for after slippage of up to 25% in value. Some actually abandoned deposits of 20%, but most others, saber rattling exhausted and maybe a few developer concessions thrown in, closed on schedule. Otherwise, it was the smaller apartments which held their value the best during the first months of the year. And the top of the market, the ultra luxury, $10,000,000-and-up properties, went begging. No one wanted them. They just sat, prices creeping down, as the months went by.

Typically, as the sales market slows the rental market accelerates; people, the reasoning goes, have to live SOMEWHERE. In 2009, apparently they did not. A weak rental market meant that vacancy rates were high, owners paid commissions, and rents were negotiable. Tenants mostly steered clear of co-ops, with their time consuming Board packages, since all the new condo buildings were full of both newly purchased and unsold units, choc-a-bloc with amenities and completely new, available for rent at attractive prices.

Throughout the sales market there was a bit of reinvigoration in late February, which was quickly quashed as the stock market nosed to its bottom in early March. And then, gradually, as spring began, a confluence of forces brought sales activity haltingly to life.

Most importantly, sellers began to acknowledge the new realities and negotiate accordingly. Prices swerved more into line with buyer expectations. Some great deals were achieved by buyers willing, to paraphrase Warren Buffett, to buy when people were nervous. April and May provided real opportunity for buyers – they bought at prices anywhere from 15% to 40% off comparable values from a year earlier, depending on the size, location, and condition of the property (the biggest discounts were seen in large properties needing renovation.) And as June rolled around, one began to hear murmurings from buyers that they did not want to “miss the bottom.” As brokers, it is always our duty to inform buyers to try to buy value and not await “the bottom” since that phenomenon is only visible in retrospect. The months between March and May clearly represented a bottom for our market, which then, laboriously, began to stabilize.

Loans, though cheap, remained (and remain) difficult to get. And the credit of the buyer was not the only issue. For the first time, banks began to hyper-scrutinize the balance sheets of the co-ops and condos in which they were lending. Was there a 10% line item in the building annual budget for capital repairs? If not, no loan! Did the building carry adequate insurance? If not, no loan! Had the market for this type of property remained stable since the original appraisal? If not, a new appraisal was ordered a week before the closing and if it came in lower, then the amount of the commitment sank proportionately. Behaviors like these left many buyers with no loan, or a smaller loan than they had been promised, just days before the closing was scheduled to occur. And buyers with mortgage contingencies in their contracts were horrified to discover that the language was fuzzy: sellers and their attorneys were arguing that once a commitment was received, the contingency was satisfied, and if the bank then withdrew the commitment, or lowered the amount of financing it was willing to provide, that was the buyer’s risk. This has led to more than one litigation during 2009 and the issue has yet to be resolved. In the meantime, the financing language in the standard form contract needs tightening!

During the summer, the pace of transactions continued, gradually, to increase and by fall we found ourselves in a fairly active marketplace. Not only were current buyers increasingly fearful that the bottom was receding, but a whole additional group of buyers, priced out of the market in recent years, came hurrying back to seize their opportunity to purchase at lower and more stable prices. For the first time in a decade lawyers and doctors led the list of professions in our buyer mix, with finance dropping to third place. And Boards, increasingly skeptical of bonus money or restricted stock and options in institutions they no longer saw as ironclad, welcomed these steady income professionals with open arms.

As the year drew to a close inventory across the board was at far lower levels than in January. In particular, resale inventory, especially properties under $6,000,000 in the older buildings, has fallen to a point where competitive bidding, in a more orderly and moderate fashion than heretofore, has once again become common. While the $10,000,000 and up market remains very slow, prices otherwise seem stable, with a slight upward trend; no-one expects major gains in 2010 but a 3% to 5% increase in value seems realistic and sustainable. And while transaction volume overall for 2009 was substantially below that of the two preceding years, as were prices, we in the brokerage business in New York, with contained supply and value conscious but steady demand, have much to be grateful for as the second decade of this new millennium begins.

For up to the minute information, please visit the Warburg Blog.

Courtesy of: Jackson Hole Real Estate Associates

These Days, we’re getting lots of questions about foreclosures. Following are brief answers to some of the most common questions we’re receiving. If you’re interested in a foreclosure property, we also suggest you contact a Realtor for information about the property and a real estate attorney for help with the many legal issues surrounding foreclosure.

What is “foreclosure?”

Foreclosure is a legal proceeding to terminate a borrower’s interest in real property instituted by the lender to either gain title to the land or force a sale in order to satisfy the unpaid debt secured by the property.

In Wyoming, there are two different methods of foreclosure:

1) Judicial Foreclosure—used when no “power of sale” language exists in the mortgage or if there is some defect or deficiency in the mortgage. This is more costly and time consuming method because the property is sold through a court proceeding requiring many legal steps.

2) Nonjudicial of Power of Sale Foreclosure—A process through which the mortgaged property is sold at a nonjudicial public sale by a public official. Thos is b y far the most common foreclosure method used in Teton County.

What is a “short sale?”

A short sale is when the proceeds from the sale of real estate fall short of the balance on the mortgage loan. The lender agrees to accept less than the amount due on the loan due to financial hardship on the part of the borrower. Generally, lenders won’t discuss short sale requests unless the borrower is already far behind on mortgage payments.

How does the Power of Sale foreclosure process work in Teton County, Wyoming?

1) Once the mortgage is in default, the foreclosing lender must comply with statutory requirements regarding notice and publication.

2) The sale, or auction, takes place on the courthouse steps at 10:00 on the published date and is conducted by the sheriff or deputy sheriff.

3) The highest bidder must pay the full amount of the bid to the sheriff’s office by 5:00pm the day of the sale.

4) The wining bidder will receive a Certificate of Sale to be recorded in the land records, which creates a lien against the property—legal title to the property remains in the mortgagor until the expiration of the redemption period.

5) Certificates of Sale may be assigned or sold, and the assignee is entitled to all the rights of the original person named.

6) For non-agricultural properties, the property owner has 3 months from the date of sale to redeem the property by paying the bid amount plus 10% interest and other fees.

7) If the property owner does not redeem, judgment creditors and other lien holders then have 30 days to redeem. If so, another redemptioner may, within 30 days, redeem from the last redemptioner and so on.

8) If the property is not redeemed after the expiration of all redemption periods, the purchaser will receive a Sheriff’s Deed to the property.

What do I do if I am interested in a foreclosure property?

There are 3 basic approaches, depending on the stage of the foreclosure process.

1) Buying directly from the delinquent property owner prior to auction.

Be sure to work with a qualified Realtor, attorney, title company and inspector and this method could work for you. If you ignore the normal safeguards, you wind up with a property in poor condition, not to mention liens, real esate taxes, utility bills, etc.

2) Buying at auction

This is the riskiest type of foreclosure investing. The properties sold at auction are “as is” with no opportunity for inspection and no warranties from the prior owner. It’s likely the distressed homeowner delayed routine maintenance and upkeep and possibly even vandalized or gutted the home prior to auction. And, if you buy an occupied property, you may have to evict the former owners.

3) Buying from the lender after the auction (REO, or Real Estate Owned)

Most foreclosed properties are taken back by the bank at auction, and the bank will generally “clean up” the property and list it with a Realtor sale. While possibly more risky than a standard real estate transaction (you probably won’t get a seller’s disclosure, for example), this option is certainly safer than buying at auction.

Can I finance a foreclosure property?

Generally, no. The sheriff will require full payment of the bid amount by 5:00pm the day of the auction. And you can’t borrow money against this property and file a mortgage, because title remains vested in the current owner until the expiration of all redemption periods.

Does a foreclosure “wipe the slate clean?”

Not always. While most liens will be extinguished via the foreclosure process, you could still be liable for real property taxes and federal tax liens, for example.

Is title insurance available on foreclosed properties?

Yes. Once all redemption periods have run and you have received a Sheriff’s Deed to the property, JHTE can provide you with an Owner’s Policy of Title Insurance.

However—if you are planning to bid at auction, be sure to contact JHTE up front and obtain a title commitment. You’ll want to know if there are any title issues that might not be cleaned up by the foreclosure process that will become your responsibility (such as real property taxes or federal tax liens). In addition, it would be helpful to know if there are multiple junior creditors who could successively assert redemption rights and significantly lengthen or delay the foreclosure process.

Is foreclosure investing right for me?

Buying foreclosed properties is not for the novice or faint of heart. As you’ve seen above, there are certainly many risks involved (such as defective or vandalized properties, liens or other title problems, and evicting the former owners). On the other hand, the profits can be significant.

If you’re considering a foreclosure property, be realistic about the challenges and amount of work involved. If you minimize your risk by working with an experienced Realtor, attorney and title company, you’ll increase your chances of success with foreclosure properties.

This is provided for informational purposes only and is not intended as legal advice. You should consult an attorney if you are considering buying a foreclosure property.

Pending Foreclosures - Teton County, Wyoming

Updated December 17, 2009

The following are pending foreclosures in Jackson Hole. To learn more about, or how to take advantage of, these opportunities please contact David or Devon Viehman at davidviehman@jhreassociates.com or (307) 734-9941.

Property Type: Teton Village Condominium

Address: Four Seasons Unit 854 - JH Residence Club - 7680 Granite Loop Rd.

Size: 3 bedroom, 2 bath, 2,240 sq. ft.

Comments: Four Seasons Resort and Hotel. Cable; Elevator; Fire Sprinkler; Furnished; Pool; Ski in/out; Hi-Speed Internet. Ski in/out; Year Round Access

County GIS: http://www2.tetonwyo.org/mapserver/map.php?view=pd&pidn=22-42-17-24-1-10-005

County Clerk Records: http://www2.tetonwyo.org/clerk/query/list.php?pidn=22-42-17-24-1-10-005

MLS Link: http://www.flexmls.com/link.html?oy7wywuq8th,10,1

Foreclosing Lender: Wells Fargo Bank

Opening Bid (Approx.): $1,792,771.19

Date of Sale: 12.29.09

Property Type: Teton Village Condominium

Address: Four Seasons Unit 857 - JH Residence Club - 7680 Granite Loop Rd.

Size: 2 bedroom, 3 bath, 1,720 sq. ft.

Comments: Enjoy all that the Four Seasons has to offer including ski-in ski-out access, spa, pool, and restaurants. Cable; Deck; Elevator; Fire Sprinkler; Furnished; Hardwood Floors; Landscaped; Pool; Ski in/out; Hi-Speed Internet

County GIS: http://www2.tetonwyo.org/mapserver/map.php?view=pd&pidn=22-42-17-24-1-10-008

County Clerk Records: http://www2.tetonwyo.org/clerk/query/list.php?pidn=22-42-17-24-1-10-008

MLS Link: http://www.flexmls.com/link.html?oy7wyqpz8r8,10,1

Foreclosing Lender: Wells Fargo Bank

Opening Bid (Approx.): $1,457,115.67

Date of Sale: 12.29.09

Property Type: Teton Village Vacant Lot

Address: Lot 33 Granite Ridge - 7775 N. Lower Granite Ridge

Size: .67 acres

Comments: This wonderfully private treed 0.63-acre lot in Granite Ridge is the ideal location for your dream mountain cabin. It is adjacent to the ski trail and walking distance to the Four Seasons. All lots adjoining are developed. The lot to the South West is owned by an existing owner for protection.

County GIS: http://www2.tetonwyo.org/mapserver/map.php?view=pd&pidn=22-42-17-24-1-01-033

County Clerk Records: http://www2.tetonwyo.org/clerk/query/?PIDN=22-42-17-24-1-01-033

MLS Link: http://www.flexmls.com/link.html?oy7wyz516vq,10,1

Foreclosing Lender: Wells Fargo Bank

Opening Bid (Approx.): $2,279,297.25

Date of Sale: 12.29.09

Property Type: Single Family Residence

Address: West Bank - Lot 14 Lake Creek Ranch - 6695 N. Granite Creek Road

Size: 5 bedroom, 5 bath, 5,938 sq. ft. on 4.54 acres

Comments: This spectacular property is the perfect Jackson Hole Retreat with a warm and inviting 5,938 sq. ft., 5 bedroom traditional log home; a beautiful 4.5 acre landscaped lot on the meandering Granite Creek; shared ownership of the 365+ acre Lake Creek Ranch with a ranch manger, barns, corrals and pastures for horses and Snake River frontage; riding trails into Grand Teton National Park. Square footage and taxes are per the Teton County Assessor's Office.

County GIS: http://www2.tetonwyo.org/mapserver/map.php?view=pd&pidn=22-42-16-20-3-01-001

County Clerk Records: http://www2.tetonwyo.org/clerk/query/list.php?pidn=22-42-16-20-3-01-001

MLS Link: http://www.flexmls.com/link.html?oy7wz728qpa,10,1

Foreclosing Lender: Wells Fargo Bank

Opening Bid (Approx.): $5,613,885.00

Date of Sale: 12.29.09

Property Type: Single Family Residence

Address: West Bank - Lot 6 Lake Creek Acres - 3075 Bridger Road

Size: 2 bedroom, 2 bath, 1,568 sq. ft. built in 1990 on 4.15 acres

Comments: Very nicely built log home bordering Snake River Associates Ranch. Only two bedrooms, both on opposite ends of the house; loft in master bedroom, vaulted ceilings; river-rock fireplaces (double sided in LR and MBR) water completely surrounds the property and a nice bridge in driveway, trees and backing the SRA ranch. No garage or outbuildings. Views are there but need to cut trees; cedar shake roof; no maintenance yard.

County GIS: http://www2.tetonwyo.org/mapserver/map.php?view=pd&pidn=22-41-17-01-4-01-002

County Clerk Records: http://www2.tetonwyo.org/clerk/query/list.php?pidn=22-41-17-01-4-01-002

MLS Link: was never in MLS

Foreclosing Lender: Private Lender

Opening Bid (Approx.): $1,006,650.78

Date of Sale: 1.5.10 (originally 12.1.09)

Property Type: Single Family Residence

Address: Westbank - Lot 1 of the Aspens 1st Filing - 3560 N. Lake Creek Drive

Size: 2 story,5 bedroom, 3 bath, 2,922 sq. ft. built in 1983 on .99 acres

Comments: There are few furnished 5-bedroom homes available for sale in Jackson Hole. This home is 100% turn-key with wonderful furnishings and it is located in the popular Aspens/Racquet Club, a short-term rental district. A lovely large lot, mountain views, seasonal stream and abundant sunshine are a few of the highlights. This property gets better the more you see it. It's a great set-up for a big family or several families. Easy to show so please call when considering the Westbank single family homes under $2M. One of the owners is a licensed Realtor.

County GIS: http://www2.tetonwyo.org/mapserver/map.php?view=pd&pidn=22-41-17-11-1-01-012

County Clerk Records: http://www2.tetonwyo.org/clerk/query/list.php?pidn=22-41-17-11-1-01-012

MLS Link: http://www.flexmls.com/link.html?oy7x07o99hg,10,1

Foreclosing Lender: JPMC/Washington Mutual

Opening Bid (Approx.): $1,411,820.74

Date of Sale: 1.14.10

Property Type: Town Square Commercial

Address: Clubhouse Addition - 15 East Deloney – Town of Jackson, WY

Size: two story, 8,460 sq. ft. on .115 acres

Comments: One of the most visible locations on the Town Square, this historic landmark was originally Jackson Drug and current home to Davies-Reid. The building is being sold in its entirety including 2940sf of prime finished retail space, 2600sf of storage and a 2940sf 2nd floor urban residence consisting of 4 bedrooms/2.75 baths. Very favorable LO and TSO zoning provide endless opportunities.

County GIS: http://www2.tetonwyo.org/mapserver/map.php?view=pd&pidn=22-41-16-27-3-16-006

County Clerk Records: http://www2.tetonwyo.org/clerk/query/list.php?pidn=22-41-16-27-3-16-006

MLS Link: http://www.flexmls.com/link.html?oy7x0ahzazg,10,1

Foreclosing Lender: Bank of America

Opening Bid (Approx.): $2,763,715.67

Date of Sale: POSTPONED - New date TBD (originally 12.29.09)

Property Type: Downtown Jackson Commercial

Address: Lot 11 WW Smith Addition. - 177 Center Street

Size: .07 acre UC-LO lot

Comments: New Unfinished development opportunity, 1 Block North of Town Square on Cache alley. 4 Units permitted as office space with 7 parking stalls. Being sold ''AS IS''. Potential investment includes Building plans. Some materials on site. Possible short sale.

County GIS: http://www2.tetonwyo.org/mapserver/map.php?view=pd&pidn=22-41-16-27-3-25-001

County Clerk Records: http://www2.tetonwyo.org/clerk/query/list.php?pidn=22-41-16-27-3-25-001

MLS Link: http://www.flexmls.com/link.html?oy7x0cs79l9,10,1

Foreclosing Lender: FDIC for ANB Financial

Opening Bid (Approx.): $846,392.45

Date of Sale: 1.14.10

Property Type: Town of Jackson Condominium

Address: Unit 484 Grand View Condominiums - 548 Snow King Loop

Size: 3 bedroom, 3 bath, 2,317 sq. ft. built in 2004

Comments: Grand Teton and Snow King views from these new, full ownership condominiums located at the base of snow king resort. Property Features: Cable to Property, Electric to Property, Mountain View, On Paved Road, Phone to Property, Teton View, Trees, Year Round Access, Amenities: Cable, Cathedral Ceilings, Deck, Dish washer, Disposal, Dryer, Eat-in Kitchen, Furnished, Landscaped, Microwave, Pool, Range, Refrigerator, Tennis Court, Teton View, Washer , Wet Bar

County GIS: http://www2.tetonwyo.org/mapserver/map.php?view=pd&pidn=22-41-16-34-3-02-004

County Clerk Records: http://www2.tetonwyo.org/clerk/query/list.php?pidn=22-41-16-34-3-02-004

MLS Link: http://www.flexmls.com/link.html?oy7x0fjw32x,10,1

Foreclosing Lender: Deutsche Bank

Opening Bid (Approx.): $813,015.43

Date of Sale: 1.5.10

Property Type: Town of Jackson - Condominium

Address: Unit 304 High Teton Condo - 755 E. Hansen Unit 304

Size: 3 bedroom, 2 bath, 1,041 sq. ft. built in 1973

Comments: Excellent East Jackson location, this 2/3 bedroom, spacious loft, 2 bath, 1,041 sq. ft. condo has been totally remodeled with fine quality finishes throughout. As-new condition, top floor unit with cathedral ceilings, deck and patio, considered one of the best units in the complex, Teton views. Close to town and adjacent to open space and short distance to Cache Creek.

County GIS: http://www2.tetonwyo.org/mapserver/map.php?view=pd&pidn=22-41-16-34-1-79-034

County Clerk Records: http://www2.tetonwyo.org/clerk/query/list.php?pidn=22-41-16-34-1-79-034

MLS Link: http://www.flexmls.com/link.html?oy7x2cu76a8,10,1

Foreclosing Lender: JSBT/Wells Fargo

Opening Bid (Approx.): $435,000.00

Date of Sale: 1.12.10

Property Type: Single Family Residence – Town of Jackson

Address: Lot 36 Horn Enterprises - 230 Crabtree Lane

Size: 3 bedroom, 2 bath, 1,886 sq. ft. built in 1979 on .115 acres

Comments: A best value: 1,886 sf, 3 bedroom, 2 bath home with living room and family/media room in a quiet neighborhood. Large fenced yard; across from bike path. Wood floors, large storage/laundry room, mature landscaping. Appliances plus extra refrigerator and freezer included! This is a short sale subject to bank approval. Owner is a licensed WY realtor.

County GIS: http://www2.tetonwyo.org/mapserver/map.php?view=pd&pidn=22-41-16-32-4-14-012

County Clerk Records: http://www2.tetonwyo.org/clerk/query/list.php?pidn=22-41-16-32-4-14-012

MLS Link: http://www.flexmls.com/link.html?oy7x2emvsi0,10,1

Foreclosing Lender: MERS/Security Nat’l.

Opening Bid (Approx.): $540,818.66

Date of Sale: 1.14.10 (originally 11.10.09, 12.10.09)

Property Type: Vacant Lot – North of Town

Address: Lot 34 Owl Creek - 8870 Deland Drive

Size: 3.1 acres with Snake River access

Comments: 3.1 acre building site north of town in the Owl Creek Subdivision. This lot is on a quiet road, tucked up against the bank. Beautiful, straight on views of the Tetons with a couple of potential building sites. Two ditches flow across the property providing for the potential of constructing a reflection pond in front of your house. Located minutes from town, Golf & Tennis, and Teton National Park, this property offers a spectacular opportunity for that buyer who wants a quiet retreat with fantastic views. The potential for water features gives this property additional appeal. Wildflowers, waterfowl, and views!

County GIS: http://www2.tetonwyo.org/mapserver/map.php?view=pd&pidn=22-42-16-15-2-05-009

County Clerk Records: http://www2.tetonwyo.org/clerk/query/list.php?pidn=22-42-16-15-2-05-009

MLS Link: http://www.flexmls.com/link.html?oy7x2gpsf6s,10,1

Foreclosing Lender: Zions First National Bank

Opening Bid (Approx.): $400,907.99

Date of Sale: 1.12.10

Courtesy of: Rimontgó

Featured in Realty Sense

José Ribes Bas, CEO of Rimontgó, and José Miguel Martínez Medina, his counterpart at Valencian design firm JMM MOBISA MARTINEZ MEDINA, enjoy the view of Valencia’s iconic architecture as they meet to discuss the true meaning and value of style, comfort, luxury and excellence.

Both men form part of a proud family tradition in their respective fields, and both have taken their long-established and respected firms to new heights. Fifty years ago Inmobiliaria Rimontgó was a small pioneer property agency in Javea. Today, as the company celebrates its fiftieth anniversary, José Ribes and his brothers run a renowned estate agency with a prominent position in the regional market and an international reputation.

His long-time friend José Miguel Martínez-Medina similarly took the family furniture business, founded in 1906, to a new level, adapting with the times while proudly maintaining the values imbued by previous generations. JMM now ranks among the leading Spanish brands in luxury bespoke office furniture, high desking and interior design solutions, with both design and manufacture harmonised within the company’s Valencia base and Madrid Headquarters.

As professionals catering to a luxury market they are directly involved in issues of style, quality and luxury – terms that form a central part of their daily professional vocabulary. But how do we exactly define these concepts – not to mention their pursuit? Is the desire for luxury and beauty a wasteful frivolity or does it drive excellence in all of us? On a practical level: Where do you draw the line between form and function, and at what point does opulence become vulgarity?

Are we right to pursue luxury?

JMM: A lot depends on how you define such all-encompassing terms. The most common association is above all with items – items in term defined by cost, quality, rarity, status and beauty, though the latter can be and very often is subject to both fashionable trends and personal taste.

JRB: Beauty is in the eye of the beholder, while fashion and trends try to create manageable avenues that channel our desires in a particular direction, be it for clothes, cars or décor. But luxury is more than the sum of beautiful items alone; it all adds up to a certain lifestyle, and it is this idea of lifestyle that we associate with luxury in general.

Is luxury always associated with wealth?

JMM: In the sense that most people picture a privileged lifestyle filled in with luxury items it is mostly associated with wealth. But there are also other forms of luxury and privilege that are often neglected but not necessarily less valid. As you grow older you realise that time is one of the great luxuries in life. The pleasure of having time to yourself is especially appreciated by those who have achieved wealth and material luxury but often at the cost of personal time.

JRB: Yes, it may sound rather philosophical to say that, for some, luxury can be something as simple as spending time with your children or grandchildren, having the time to socialise with friends or indulging in a pastime like fishing, but they are often exactly the things people with money and success miss or cherish the most.

Should we therefore be pursuing less material dreams?

JMM: Of course, but that’s like saying that you should eat more sensibly, exercise and not waste your time and energy bickering or worrying unnecessarily. Most of us will arrive at these realisations at some point in our lives, yet the drive to improve ourselves is still primarily manifested through a desire to attain more wealth, comfort, status and the lifestyle and recognition that comes with it.

Is this somehow shallow?

JRB: Naturally there should be a balance, but on the whole these are essential human drivers that have been around since the earliest of times. We are social and therefore competitive creatures, so we wish to do well, reap the rewards and attain position within our society. You can take it to negative extremes, but on the whole it’s an instinct that serves mankind well because it is the force behind most of our innovation, creativity and the desire to want to improve things.

JMM: Without these impulses the world would be dreary. There would be no desire to achieve excellence, to surpass ourselves or to produce things of great beauty and art. In a totally utilitarian world there is no merit in dreaming, and without dreams we lose the ability to conceive and realise great ideas. The few social experiments in this direction are chilling examples.

By: Naples Daily News staff report

Courtesy of: John R. Wood Realtors

The buying goes on.

Home resales rose again in November in the Naples market.

There were a total of 511 sales, up from 307 in the same month a year ago, according to a monthly report by the Naples Area Board of Realtors.

The report tracks sales made through the SunshineMLS, or multiple listing service, in Collier County, excluding Marco Island.

The strongest sales continue to be in the under $300,000 market. There were 367 sales made in this category last month, up from 218 a year ago.

All price categories in the report saw increases in November.

The $300,000 to under $500,000 market was the second most active last month. There were 76 sales in this price range, up from 41 in November 2008.

The median price - the price at which half the homes sell for more and half for less - continues to drop. Last month, it fell to $173,000, down 11 percent from $195,000 a year ago.

Local Realtors say consumer confidence is improving, which is helping sales in higher price ranges. There are signs of a market recovery, said Phil Wood, president of John R. Wood Realtors in Naples.

There were 37 sales made in the $500,000 to $1 million category last month, up from 31 a year ago. There were 22 made in the $1 million to $2 million segment. Nine homes sold for more than $2 million.

“The Naples area is following a traditional market recovery as buyers are going up the price scale and purchasing higher priced property. This is a considerable change from what we have seen in the past two years,” Wood said in a statement.

Overall pending sales for properties in the $300,000 to $500,000 category increased 230 percent with 155 contracts in November 2009, compared to 47 contracts in November 2008.

Pending sales increased in the $300,000 to $500,000 price range in both the single-family home market, which was up 200 percent, and the condo market, where they rose 282 percent from a year ago.

The inventory of single-family homes and condos decreased 14 percent to 9,469 in November.

“As season approaches, December marks the time of year that most sellers list their property,” said Mike Hughes, vice-president of Downing-Frye Realty in Naples, in a statement. “However, we are not seeing a large increase in the available inventory due to year-end sales remaining strong.”

By Tim Estin of Mason Morse Real Estate

On 12/24/09, Colorado Public Radio interviewed Aspen real estate broker and blogger Tim Estin about recent trends in one of the wealthiest markets in the country. To listen to interview, click link: "Aspen Real Estate Goes Through Peaks and Valleys" .. (See CO Public Radio Dec. '09 schedule). This posting is derived from notes in preparation for that interview by Tim Estin mba, gri - Broker Associate/Mason Morse Real Estate Aspen.

National Economy

- Stock market UP +; National confidence UP +

- Not as scary as we thought it was. In Aspen, buyers are still spending a lot for the quality of product they’re getting

- Lots of good news, may be at or near bottom… Likely to be choppy moving forward

- Heard on news the other day markets have vastly improved in LA, SF and Las Vegas: over 50% of the inventory has been cleared out.

- Signs every month that market and conditions are improving

Aspen: Current Data

In Aspen, there’s been an uptick in sales activity due to an increase in marketplace confidence and comparatively from where prices have been. More negotiations are going on, less of a standoff between sellers and buyers, and prices are adjusting.

3 of last 4 months (July, Aug, Oct) were better than 2008, ending a string of 21 months of year over year declines (Pitkin co/Land Title)

Aspen single family home avg price year-to-date (YTD) is basically unchanged from 2008 at $6.1M. But the averages have been skewed by some very high priced and notable sales in 2009 (esp. $43M Willoughby Way, Red Mountain Aspen home sale)

Aspen residential sales Aug 1- Nov 30th (these 4 mos compared to same period 2008)

• Closed sales transactions +26%

• Under contracts +94% (MLS)…under contracts/Pending are an indicator of future activity

This yr sales high end sales stats:

• $7.5M and above: 23 sales in 09 YTD; 28 last year

$8M+ and above, this year 19, 25 last year;

• $9M and above, 15 this year, 17 last year.

Aspen still has sellers who want to sell in this market, and some are still happy – content? – if they bought before the peak and are relieved to have negotiating room and be able to sell.

Average sales price are “holding” but new expensive property sales have distorted the average and median prices.

The Aspen average home sale price:

2008 = $6.2M

2009= $6.1M

But values are dropping as witnessed with Median price stats.

Median prices: (better indicator because averages get so skewed by very high priced sales)

2008 = $5.8M

2009 = $4.76M (-18%)

Market wide volume and dollar sales decrease (Land Title):

2007 = $2.2B

2008 = $1.3B (-50%)

2009 = $1.07B (-18%)

There has been significant listing price erosion led by builder/developers who want out of brand new properties at approximate range of $800-$1100 sq. ft.

But in Aspen, buyers are still spending a lot for the quality of product they’re getting

What’s Selling?

Anything new, recently remodeled totally pressed out, and great values. Fundamentally, buyers are looking for value. How do they judge value? It’s a combination of BEST QUALITY AT THE BEST PRICE …high quality, high grade properties, A-Grade stuff, AAA locations. These are selling at strong numbers or at great deals.

In this buyers market, shoppers are looking for quality and value. For middle of the road properties, it’s been difficult and really tough. Pricing correctly is the single most important element to a successful listing. If one doesn't have to sell, don't; if one does, be realistic...do not be as the 11/23/09 New York Observer article stated, "The Last Swaggerers: Hearty Bunch of Sellers Price Like it 2007".

Foreclosures

We still have foreclosures: this year in Pitkin County = 105 vs 35 last year. It is the most in 24 years according to a recent Aspen Times article. ..(the average is 40 per year). A big question mark is how deep the pool of distressed sellers is. National media indicates high end distress and foreclosures is a growing problem monthly (See 01/03/10 Denver Post and see 12/18/09 WSJ and 12/29/09 WSJ in the Aspen Real Estate Archives Section on this site), even as the lower end appears to be recovering albeit at vastly lower prices. The downturn is more severe than any we have ever experienced in our lifetimes.

Fractionals: Residences at the Little Nell (RLN) and Dancing Bear (DB)

RLN has been unfairly judged by their immediate and unsurpassed sales success out of the gate, when they started selling in summer 2006. By Sept 2009, they were 98% sold out, an unbelievable success. Offering prices doubled. Then fall 2009 hit and contracted buyers bailed.

Fact: they are almost 50% sold out now. The project opened opened in Feb 2009. The fractional industry in general forecasts selling out within18-24 months after opening, so many regard the RLN sales as still a success, but regretably it falls short of unrealistic expectations when compared to their sales boom of 2006-2008.

The product has always been about LIFESTYLE, not investment. It got skewed towards the investment side as offering prices increased, something a lot of buyers chose to overlook in past 3 years of wild “paper appreciation”. One thing is clear: if one wants to enjoy/own perhaps the ultimate Aspen ski-in/ski-out luxury experience, RLN and Dancing Bear (an in-town boutique experience that is a lower cost alternative to RLN but without ski-in/out) are the way to go.

Owners reputedly love the RLN product: its location at the ski epicenter of the “world” and level of service and amenities are simply unmatched and incomparable. Yes, I am a fan, financing for their product is now available. Call or email me directly for info, 970-920-7387.

Total Aspen Snowmass Fractional Statistics (Land Title)

- Oct 2009 = +101% to $11.9M from Oct 2008

- 2009 YTD = total fractional dollar sales are $173.8M, +314% from same time last year.

- Units Sold = 246 sold units, + 27% over same time 2008.

Future: where are we headed?

2010 is likely to be similar to 2009. I am cautiously optimistic: There will be some great deals, there will be some properties selling for very big $ numbers, importantly the number of transactions are increasing.

We know that in all price ranges we may not have reached bottom and that it cuts across the board and depends on the property, seller circumstances, motivations, etc.

Aspen is like a lot of places throughout the country. The real estate values and economy were not immune to global and national declines, Yes, some businesses failed but new ones are coming in here. We have new restaurants art galleries and retailers opening regularly.

But Aspen is NOT just about Real Estate: we are a four season destination resort offering unmatched recreational, arts and cultural amenities and that's what's going to pull us through all this.

Aspen Ski Co is a private family owned company that continues to invest in the quality of the ski experience. It’s put in approx.$130MM in past 6 yrs in capital improvements. This year it’s maintaining the same level of guest services as last year (staffing and hours of operation on or near mountain).

Even though inventory of properties for sale has swelled, there is still relatively little product available in Pitkin County. 92% of the land surrounding us is publically owned( USFS, BLM, Open Space and conserved land).

Bottom line: there’s only one Aspen - think sports, arts and culture offerings: short term, yes there are challenges and businesses will be choppy because as mentioned, we have found we are not immune from national and global economic events as previously thought. Aspen offers a small town community with world class amenities within a highly restrictive zoning environment that for the past 40 years has has successfully protected its unique beauty and historic charm. There is every reason to believe that in an over-crowded and somewhat homogenous resort fair, Aspen's unique attributes will be in ever-increasing demand in the future.

Buyer Opportunities

1. The best deals are on properties in which there is significant financial stress on sellers. These are new development projects, spec homes, property owners who bought at peak and may be highly leveraged, where loan pressure is motivating a sale. Buyers are looking for quality at the best price and these new build and remodel projects being sold by motivated sellers represent excellent quality at historically reduced prices.

Read: The Estin Report interview in 11/16/09 Aspen Daily News

2. Ability to obtain beautiful and unique homes seldom available. This is an uncommon period in which buyers can obtain Grade AAA properties in stellar locations - the Best Properties - and/or with unique circumstances that cannot be reproduced and are irreplaceable due to changes in Pitkin County land use codes.

3. Window for Buyers: Great Quality/Great Price = Great “Deals” will be gone before one knows it...by the time one does, it's too late.

There is a “window” of opportunity for buyers to purchase quality and uniqueness at the best price = Great Values. But the inventory of buyer opportunities suggested above are finite and limited. When they’re gone, they’re gone and buyers will have less high quality choices. Even though prices may still be down, the quality of what is available will be less. The Great Quality/Great Price =Great “Deals” will be gone.

For those market timers, one will not know or see the turn in the market until it has already occurred.

Why Care about Aspen Real Estate?

Aspen real estate is probably more interesting from a human interest point of view than real estate specific interest. Of course it’s always interesting to hear about the wealthy and what’s happening on their lives. It makes most regular mortals feel better, I guess.

But what happens in Aspen is certainly important for the Roaring Fork Valley …ripples in the pond theory: what happens here creates waves as one travels down-valley. The closer to Aspen, the higher the real estate prices, the greater the economic impacts. A lot of people who work in Aspen or own businesses here live outside the immediate area, so their jobs and businesses and livelihood depend on the Aspen economy.

Other than that, probably no reason for the national media to really care. But they do. Our market is watched, and people do appear to be paying attention.

Disclaimer: The statements made in The Estin Report represent the opinions of the author and should not be relied upon to make real estate decisions. Information concerning particular real estate opportunities can be requested from Tim Estin at 970.920.7387 or at testin@masonmorse.com This e-mail address is being protected from spambots. You need JavaScript enabled to view it . A potential buyer is advised to make an independent investigation of the market and of each property before deciding to purchase. To the extent the statements made herein report facts or conclusions taken from other sources, the information is believed by the author to be reliable. However, the author makes no guarantee concerning the accuracy of the facts and conclusions reported herein. For reproduction use of any parts of The Estin Report, the author requests direct attribution to him as, "By Tim Estin, The Estin Report, at www.EstinAspen.com" or please contact him directly. All rights are reserved and the articles and blog posts are copyrighted.

Courtesy of International Property Journal

We asked an array of industry leaders: What will be the big news in international property in 2010? 

James Wyatt, partner, Barton Wyatt International
I believe that Florida sales to U.K. buyers will increase dramatically as buyers continue to shun Euroland. However I can see Euro purchases on the increase late in 2010 as U.K. interest rates start to rise, leading to a weaker Euro. Looking further afield, destinations such as Brazil, Panama, Middle East and the Far East will be all but unsalable. 

Mark Stucklin, analyst, SpanishPropertyInsight.com
Well, the big news won’t be a big rebound in the Spanish property market, because that’s not going to happen. However there will be some great deals on prime Spanish property to be had during 2010, for those who can be bothered to do their homework and have funds in place. It will go largely unnoticed but some people will do very well.

Google Real Estate might be big news in 2010. As this functionality grows in popularity it is going to create threats and opportunities in international real estate marketing. At some point it will be popular enough to shake up the business, and that might happen in 2010.

 

Liam Bailey, head of residential research, Knight Frank

The re-emergence of the Asian buyer will be significant factor in the prime European and North American markets. Russian, Indian and Middle Eastern buyers have been active through 2009 in locations like London and the south of France. But the next wave of money coming to take advantage of lower prices--and in the UK's case a weak currency--will be Chinese, Malaysian, Hong Kong and Singaporean buyers.

The other big trend to emerge will be the restarting of the resort development sector. It has been on hold across 2008 and 2009, but from Europe, the Caribbean and other hotspots the research and investigation stages are just beginning again and the market is beginning to move towards thinking about how to restart schemes rather than thinking how they can get out of them.

Bruce Hiatt, broker/owner, Luxury Realty Group, Las Vegas/Toronto
I believe that luxury high rise residential condo supply in Las Vegas will be much smaller than originally thought; excluding hotel condos. Once the current heavily distressed-priced residential condos are gone there will be little incentive to build new high rise luxury condos near or on the Strip for many years. Already we are experiencing buyers waiting to buy in certain high rise residential condo towers and cannot find the specific inventory identified at the price point desired. By price point we mean at current comparable levels including foreclosures, not unrealistic price points.

In the Toronto marketplace, I believe the Canadian market will continue to experience a strong loonie (dollar), high demand for luxury residential condos in the prime locations and supply challenges in the best located luxury high rise condo towers. In one example, a luxury high rise condo building of nearly 80 units only has 3 units for resale at this time with prices starting over $1.3 million and buyer traffic is strong. I’m not yet licensed in Canada so this is from conversations with my future luxury real estate brokerage. Some luxury condos continue to sell north of $1,300 a sq foot in Toronto.

Stuart Law, c.e.o., Assetz, U.K.
Severe limitations in supply of property will continue in 2010 as the house building industry struggles to increase output to any meaningful level, which will underpin prices in the face of very substantial demand.

Mounting government pressure on lenders to reduce margins and increase lending, combined with continuing lender competition now the major annual house price indices are turning positive, will be the catalysts for maintaining affordability for new buyers and further reducing the costs of new borrowing. Base rates will eventually start to rise, possibly at the end of 2010, but payable mortgage rates will remain low for the next two years at the very least.

Other negative factors (not expected to outweigh positive): Repossessions will be modest again in 2010 as they were in 2009 at 50,000. Unemployment probably peaked around the end of 2009 and will have little effect on prices. Tax increases will also hold back sentiment and affordability somewhat.

Eugenia C. Foxworth, Foxworth Realty, New York
I believe that there will be risks takers who will continue to invest, but for one-third the cost. Given what I am experiencing with my European investors and customers (residential, resort & multi-use properties), which is the majority of my business, 2010 is not going to be the year for speculative dealings and financial risks. Of course, there will be some successful stories but it will be a disaster for the sellers. Hotels, resorts and commercial spaces are being offered but there are no takers. I believe that 2010 will be a very dramatic time in international real estate. Monte Carlo is feeling it now!

Martin Dell, director, Kyero.com, Spain
The differing pace of economic recovery between nations will create opportunities for buyers and sellers.

In Europe, the stronger German, French and Dutch economies will enable buyers from those nations to seek and aggressively negotiate property deals in the slower-to-recover European countries--Portugal, Italy, Ireland, Greece and Spain.

Even though there is no currency exchange advantage for these buyers, the Euro will buy a lot more property in these PIIGS countries in 2010 compared to 2009.

If the U.S. economy continues to improve and the U.S. dollar increases in strength against the Euro, we could also see opportunistic U.S. buyers sniffing out deals in those slower-to-recover countries.

This buyer activity is already happening at the top end of the market in the U.K. where foreign buyers are taking advantage of the devalued pound, a slow moving property market (tipped to get slower in 2010) and a stalled economy. Expect more of the same for the U.K. and the phenomenon to extend to more countries in 2010.

Stuart Johnson, product sourcing manager, Experience International, U.K.
Quality property, with unique luxury architecture in prime locations in the established Aegean resorts of Turkey priced £100k to £250k will be big news in 2010. U.K., Scandinavians and Middle Eastern buyers will be investing in these locations. These developments will attract established tour operators and hence provide secure incentives like long term leasebacks.

We see France as a developing market. It already has a stable and robust real estate and mortgage market, and as well being the most visited country in the world. Developers are now leveraging these credentials to provide more and more tempting deals, mainly utilizing high loan to value mortgages--only the credit worthy need apply!

Debbie Maue, NAR liaison to Costa Rica, broker associate, Jameson Real Estate, Chicago

I think we will see a slow comeback, but not until the fourth quarter. The first year from U.S. markets is going to be hectic and chaotic as the lending laws continue to change, and buyers scramble to take advantage of the tax credits and REO/short sale opportunities. 

As those markets get absorbed and the resale market in general "shifts back into place" a bit, those sellers looking to retire will now have the funds. Most of the investment in second homes will be for retirees as their funds had been locked up in their primary residences. As well as, there are great deals to be made in the second home market and investors will be taking advantage. 

Adam Blaskey, managing director, North Beach, U.K.

I believe that there will be a continued but more sustained ‘flight to quality’. The exchange rate remains extremely favourable to foreign buyers acquiring property in the UK. The recent upturn in prices signifies the bottom of the market, I expect demand from overseas buyers to support prices, particularly in Prime Central London. No one will be taking risks by either over-paying or buying in fringe areas hoping for a ‘ripple effect’, but they will continue to buy quality property, finished to a high specification located in the most desirable areas. 

Dagmar Sands, former FIABCI-USA president, broker, Real Estate International, Inc.
My 2010 Prediction is that more banks will be closed in 2010 resulting in lot more properties foreclosing and driving our pricing down even more. My German clients told me they are waiting for the dollar to even go down to 2-1 ratio and then they will be purchasing.

Paul Brewbaker, economist, TZ Economics, Hawaii
I’m going to guess that the amazing rehabilitation of private-label commercial mortgage securitization will be the big story of the year. It will occur in an environment of evolved bank capitalization—presumably with regulatory reform to mitigate tax arbitrage and other incentives for excessive CDO-based leveraging. Its renaissance will come amidst further development of ideas regarding “macro-prudential regulation,” such as variable capital requirements designed to lean against the wind of incipient asset-pricing bubbles.

Collateralized debt obligations themselves will be revived as plain-vanilla financial structures of the sort one sees in straight-up textbooks like Duffie and Singleton’s Credit Risk (chapter 11, on CDOs), parameterized to the newly populated “fat-tails” of the distribution facilitated by the financial crisis of 2007-2008, financial panic of 2008 (post-Lehman) and Great Depression of 2008-2009. Hell, even the rating agencies will have better math—indeed, maybe they will even publish default probabilities instead of letter grades (another “straight-up” reform).

In the course of the year 2010 the Federal Reserve will gradually take the training wheels off CMBS conduits and let the market ride the bicycle on its own. Pointy-headed n00bs like certain professors (well, professor, singular) will be dumbfounded that, ultimately, there was not a glut of commercial real estate in the alpha quadrant and that—ZOUNDS—financial solutions to financial problems actual did exist, which fellow finance professors could have told him, if you know who I mean (rhymes with Martini). The hordes and hordes of cash piled up in safe havens and global portfolios glutted with U.S. Treasury securities will find once again that commercial mortgage-backed securities offer compelling risk-adjusted returns under transparent design calibrated to jump-risk metrics informed by the recent crisis.

And, amidst all of this, the fear-mongering of Chicken Littles with their W-shaped alphabets and the Talking Heads on CNBC—even the dumb asses on Fox News—will have to find something new with which to terrorize viewers, since lately they’ve devolved to reporting on to the Scary Fad of the Week. One day it’s CMBS that is the “ticking time bomb.” This week it’s the threat Tiger Woods raises for global financial stability. Next week it’s Dubai that is a cancer waiting to invade the economic recovery. The week after that it will be the Las Vegas Strip that has the seismic potential to unravel the recovery. Did you hear? Nevada had to legalize prostitution and gaming, just to get people to build luxury condos in the desert! I’m shocked, shocked to find that there is gambling going on in these premises!

Lucy Russell, managing director, Quintessentially Estates, London
1.) Change of buyers: Some international countries being more impacted by recession, i.e. Western countries. Stronger from Eastern and China.

2.) If U.K. emerges from the recovery and GBP strengthens then foreign investment may drop

3.) I think Dubai will continue to need financial support and capture headlines

4.) The Caribbean will see an improvement with islands like St. Lucia seeing high sales.

5.) Brazil is expected to see an increase in international buyers with the growth in the property market.

Sam Taliaferro, director/developer, Valle Escondido, Panama
Commercial property the world over will be in the headlines as it is the next bubble to pop. But not in Panama, due to the canal expansion and not having a lot of overhang.  

Residential apartments on the other hand will not be so lucky. The bust has taken place over a year ago, but few involved in the market will even admit it. Prices have declined significantly, 15 to 25 percent, and have further to go as more product comes on the market over the next year with little demand.

Hotel occupancy rates and prices, which have been at an all time high in Panama City, will drop significantly as the economy declines and much more product comes online.

The second home market around the world and in Panama will continue to be lethargic and may get worse if the economy continues to decline. To be successful in this troubled market will require innovation in both development and marketing.

Recent bond activity for Panama sovereign debt may make plans for major infrastructure projects such as the canal expansion and metro considerably more expensive.