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Tag Archives: Real Estate

Supply and demand in local economics

Act 1: If housing is too expensive, allow the supply curve to operate.In a surprising bit of excellent economics,  Conor Dougherty  writes "Build Build Build Build..."in Sunday's New York Times.The story starts with the usual way of doing business (meaning, not doing business) in California:A developer had proposed putting 315 apartments on a choice parcel along Deer Hill Road — close to a Bay Area Rapid Transit station, and smack in the view of a bunch of high-dollar...

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Real estate ups and downs

In a delightfully YIMBY "Americans Need More Neighbors" the New York times gets it almost all right.Housing is one area of American life where government really is the problem. The United States is suffering from an acute shortage of affordable places to live, particularly in the urban areas where economic opportunity increasingly is concentrated. And perhaps the most important reason is that local governments are preventing construction.It goes on, even noting flagrant progressive...

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Your comprehensive guide to the all new ‘Upstairs Downstairs’ London property market

Three months down the line, enough time has passed to properly assess the impact of Brexit on the London property market. Curiously, Knight Frank’s latest London property survey says it may have been stamp duty which proved the bigger value destructor, with sterling’s depreciation post the Brexit vote actually helping to stymie prices in prime localities. From the property specialists: The single biggest factor that curbed demand in the 18 months prior to the referendum was the increase in...

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The weird world of property crowdfunding

The building pictured above is on Boyd Street in Whitechapel, east London. Last year, a flat in the former warehouse was sold to investors on Property Partner (from whom the photo comes), an equity crowdfunding website backed by London VCs Octopus Ventures and Index Ventures. The flat’s market value in January 2015 was £525,000; Property Partner grabbed it at a discount for £435,000; and in July another independent valuation put the price at £611,000. But in the past three months investors...

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“Golden bricks”

In the real estate world, the term “golden brick” refers to the first level of bricks above ground and is typically discussed because of the tax implications: developers can avoid VAT on a land sale with a “golden brick” transaction, where it’s obvious that a building is under construction. In the peer-to-peer real estate world, the term “golden brick” has emerged as a nice bit of spin for property market pain. Here’s Property Partner, a crowdfunding site for housing equity, encouraging its...

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Buy this loan to let a wannabe landlord from Brazil get a mortgage in London

You might recall Deutsche Bank’s bearish note on the London buy-to-let market last month. It argued, in short, that regulatory changes had set property in the British capital on the road to a nasty crash in the not-so-distant future. And that was before minor things like Brexit and the closure of a raft of open-ended property funds. (It still boggles the mind. Open-ended fund. Property funds. Open-ended… property…) Well, online lenders are putting on a brave face and continuing boldly on....

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Transaction costs as the saviour of UK real-estate?

Six open-ended UK property funds (and counting) have suspended redemptions on the back of Brexit induced volatility leading some to worry the market’s on the verge of a sizeable correction in UK real-estate prices. But this isn’t the crisis of 2007, says SG’s Jean-David Cirotteau. As Cirotteau and team observe, during the subprime crisis, UK office prices dropped by 38 per cent from peak to trough from the end of 2007 to mid-2009, and within that context the London residential price...

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The London property market is doomed, doomed I tells ya

Yes, yes, we know, people will keep buying property in London no matter the price, no matter the Brexit, no matter the sheer insanity of it all. But, there’s a credible bear case to be made that regulatory and tax changes in the buy-to-let market — known colloquially as the ‘evil landlord’ sector — are about to prick what has become a very sizeable bubble. Last week, Deutsche Bank analysts Oliver Reiff and Markus Scheufler made that case over about 70 pages, arguing that for any rational...

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