Russians to boost Cypriot property market? (16 July 2008)

After months of negotiation, the Russian parliament (Duma) has voted to approve a double taxation treaty with Cyprus, paving the way for Russian citizens to buy property in the country under more favourable conditions.

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Spanish property transfers up 2.5% in April! (16 July 2008)

During the month of April the number of property transfers across Spain rose by 2.5% y-o-y and 19.3% on March’s recorded figures pushing the total number of transfers up to 214,795, according to figures released by the Spanish National Statistics Office (NSI).

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New Finance for Caribbean purchases (15 July 2008)

HiFX Mortgage Services, the fee-free overseas finance arm of FX brokers HiFX, has announced the addition of the first Caribbean lender to its portfolio.

More Spanish resale price falls (12 July 2008)

Resale property prices across the major housing markets in Spain have fallen by between 2% - 4% throughout the second quarter of 2008, with falls of 2% in Barcelona, 2.1% in Madrid, 2% in Valencia and 2.1% in Bilbao, according to Spanish property portal Idealista.com

Russian gas giant invests in Morocco (12 July 2008)

The property arm of Russian gas giant Gazprom has revealed its intentions to invest nearly €1billion in the Moroccan property market by developing two new projects along the African country’s mountainous and coastal regions.

Italian fashion comes to Dubai (04 July 2008)

Italian fashion house Gianfranco Ferre and the Dubai-based property financer Galadari Investment Office (GIO) has announced its intention to build a $1.2billion, 60-floor residential and commercial tower block in Dubai, becoming the third company from the fashion sector to enter the Emirates property sector in as many years.

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New low cost airline for Dubai (03 July 2008)

The Dubai government has announced that its first low-cost airline to operate in the country has been named FlyDubai.

Spanish tax loophole? (28 June 2008)

Hundreds of Britons who have sold a property in Spain between June 2004 and December 2006 have begun the fight to reclaim their money from the Spanish government, which, it is claimed, overcharged them Capital Gains Tax (CGT) by 20%.

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Emerging markets improve transparency (27 June 2008)

Emerging markets have significantly improved their levels of real estate transparency according to the latest Global Real Estate Transparency Index from property consultancy Jones Lang LaSalle and LaSalle Investment Management, its global real estate investment management subsidiary.

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New marina for Pathos (22 June 2008)

A consortium headed up by one of Cyprus’ biggest property developers, the Leptos Group, has won its bid to build the new Paphos Marina.

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Russians to boost Cypriot property market?

The new treaty replaces the one signed between the two countries in 1998.

In the past decade, Cyprus has signed several double taxation treaties with countries in its sphere of influence in an effort to make the country an attractive place to set up off-shore enterprises and to buy property in.

Despite the numerous treaties, the signature from the Russian parliament is perhaps viewed as the most important one on the list. Scores of Western businesses have established a presence in Cyprus to trade with Russian companies and Russians are now viewed alongside the British as the most important international buyer group on the island.

Ukraine balks from treaty

Although the Russian government ratified the treaty, the communist Ukrainian parliament has rejected a similar agreement between itself and Cyprus.

The Ukrainian government believed that the old treaty between the Soviet Union, of which the Ukraine was a member, and Cyprus in the 1980s, was too generous and allowed private individuals and companies to avoid paying the appropriate level of taxes in their home country.

It has since rejected the new treaty with Cyprus and is likely to take a further six months for it to be altered and put before the country’s government again. The Cypriot parliament is also unsure of the treaty’s composition and believes that it goes against the nature of the original agreement.

Spanish property transfers up 2.5% in April!

Of the nearly 215,000 transfers in April, 120,971 were for properties sold, 6,675 were donated, 2,751 were swapped, 32,901 were inherited and 51,497 were listed as ‘other titles’.

Some 88% of all property sold in Spain across April was classified as urban and 12% rustic. Sales of urban property rose for the first time in several months by 18.3% on March’s figures, but still recorded a decline, although slowing, of 5.8% y-o-y.

The gap between resale and new build purchases is as close as it has been since the start of 2007, with 27,484 transfers for new build and 28,318 for used. The sale of new build property rose 22% month on month and 12.3% year on year.

Transactions for used housing also rose 20.3% in March, however still recorded a decline of 20.4% on the number recorded the same time last year.

In April 2008, the total number of transfers of property per 100,000 inhabitants was highest in the Communities of Castilla-La Mancha (956) and La Rioja (857).

The Communities showing the highest number of sales per 100,000 inhabitants was the Región de Murcia (478) and Castilla-La Mancha (460). In April 2008, 70.4% of dwelling transactions were recorded in four Autonomous Communities: Andalucía, Comunitat Valenciana, Comunidad de Madrid and Cataluña.

New Finance for Caribbean purchases

First Caribbean National Bank will finance properties across the islands and provide mortgages to expats in the Caribbean and UK residents.

First Caribbean will be offering loans to finance properties on the islands of Barbados, St Lucia, St Vincent, Tobago & the Grenadines. The loan carries a LTV ratio of up to 70% for properties of up to $2.5m, 60% LTV for construction projects and 50% LTV for properties over $2.5m.

Despite problems in the US, there has been no knock on effect on the Caribbean Islands and they are still proving to be an incredibly popular destination. With the Pound trading well against the Dollar, especially compared to the Euro, the demand from British buyers is ever increasing."

The overseas mortgage market is complex and we know that borrowers have traditionally struggled to find a regulated broker and good UK residential brokers have often been dissatisfied with the service provided by many of the overseas players.

More Spanish resale price falls

Analysing samples of over 81,000 resale properties across Spain in the first six months of this year, the portal said that prices have fallen at a "faster rate than seen in more recent reports".

According to its research, prices in Madrid City have recorded their largest ever negative variation since Idealista began preparing its report in Q4 2005, while Barcelona has accumulated five consecutive quarterly falls, with prices now sitting at €4,662 per sqm.

"It is likely that prices are falling even more than is reflected by most reports.

The more aware sellers are that they have to adjust to the change in cycle and accept offers, the more chance they will have of managing to close the deal.

Discounts are rising

Most developers across Spain are starting to realize that to shift stock in this current climate then large discounts will have to be introduced. A new study has revealed that 6 out of 10 Spanish developers are now offering discounts to in an effort to spur sales. When indirect discounts are included 71% of developers are offering buyers improved terms.

According to Spanish Property Insight, which published the report, 41% of the developers surveyed revealed that discounts of between 10% and 20% deliver the best results. Some developers are also offering a range of other options aside from direct discounts to shift stock. Half of all developers surveyed said that incentives such as better payment terms and mortgage subsidies were being used.

Russian gas giant invests in Morocco

Gazprom’s real estate subsidiary Kudla has established a Moroccan-based group, Intelco, which will oversee the development of the Paradise Golf Resort at Aouchtam in the Rif mountains, comprising of high-end villas, a golf course, residential apartments and a marina. Further development of the surrounding area will see some 58 hectares of projects to be developed between Tangiers and Tetouan.

The group is also working on a 1,200-hectare project on the Mediterranean at Azla, near Tetouan, which will also comprise of luxury residential property, a golf course and a marina development.

Explaining his firm’s decision to enter the Moroccan sector, Mohamed Ghalat, director of Kudla, told a press conference: "We want to invest here because the Spanish market is saturated."

Related news

A UK-based agency has also entered the Moroccan sector, by launching Les Terrasses d’Agadir - what it is calling the first apart-hotel project to be situated on Morocco’s Atlantic Coast.

Les Terrasses d’Agadir is a 147-room apart-hotel that offers investors the opportunity to buy a fully managed and furnished 4-star serviced apartment.

Morocco’s King Mohammed VI, recently instructed that continuous improvements should be made to the country’s infrastructure, law and security enforcement, environment, and responsible tourism and property development in order to remove any obstacles inhibiting foreign investment. Now Morocco has developed an ambitious strategy dubbed Vision 2010, which has been backed by the Ministry of

Tourism and aims to attract 10 million tourists per year by 2010. This will involve the construction of more holiday complexes and increased investment focusing on property developments, seaside resorts and marine and airport infrastructure."

New low cost airline for Dubai

Details on its area of operations and brand identity will be revealed in the next few months, however sources talking to OPP believe it will fly to multi-country routes within a five hour radius – taking in India, other GCC countries and south eastern Europe.

"FlyDubai’s operations will potentially cover an area of some two billion inhabitants," said Sheikh Mohammed bin Rashid Al-Maktoum, vice president of the UAE and ruler of Dubai who chose the carriers name from a shortlist.

"It will support Dubai’s commercial and tourism sectors by serving a new set of travellers, and providing them with affordable air links to popular, high-demand destinations. A lot of ground work has been done thus far, and I’m pleased to note that FlyDubai is on track to launch its first flights by mid-2009.

"FlyDubai will initially focus on regional flights within the GCC area and surrounding countries. Its operations will be entirely separate from Emirates Airline and Group," added the ruler.

Since the announcement in March of the government’s intention to launch a budget airline to attract a different type of tourist and buyer to the country, the airline has been working to recruit new staff, develop an effective route system and establish a pricing strategy.

Ghaith al Ghaith, chief executive, of FlyDubai added: "It has been a busy time, but everything is going to plan. The selection of a name for the airline is only the first of many milestones to come, and we look forward to announcing more details over the coming months purchase and select value-added services to their basic flight experience."

Spanish tax Rip-off!

The previously exposed tax rip-off where British non-residents paid a Spanish Non Residents’ Income Tax rate of 35% on any capital gains, compared to a rate of 15% paid by Spanish nationals. The 20% overpayment "contravenes European Community Treaty rules on discrimination and therefore was unduly charged by the Spanish Government".

However, whereas initial conservative figures put the total amount to be reclaimed at £11,000 per person – an estimated £37million, over the last three months hundreds of Brits have registered average reclaims of more than £19,300 each, pushing the estimated amount Brits could claim back up to £86million.

Since OPP first reported on the issue in April, more than 300 people have so far registered requests for rebates through the website www.spanishtaxreclaim.co.uk with many more expected to come forward as word spreads.

In an attempt to explain the near doubling of monies claimed back by Brits, a spokesmen said "Since establishing this class action against the Spanish tax authorities, we have always said it would be extremely difficult to put an actual figure on the number of people affected by this tax issue and how much they would be able to reclaim from the Spanish government. This is largely because the Spanish government will not reveal this information, and this is why our initial estimation about the amount being able to be reclaimed was on the conservative side.

However, the sums that people are coming forward to reclaim are much larger than anticipated, almost double in size. So far more than 200 people have registered to be part of the class action, which is a huge response, but we anticipate there are more than 4,500 British people affected by this, meaning there are still a lot of people who need to come forward to reclaim what is rightfully theirs."

People who have sold property previous to June 2004 have already missed out on being able to make a reclaim on their overpaid tax, as under Spanish law claims can only be made dating back over a four-year period.

Commenting on the issue, Spanish lawyer Emilio Alvarez said: "In some cases potential claimants are being put off by the lawyers who acted for them during the sale as they are being told that they will not be able to get hold of the necessary forms (Form 212) or that this consumer campaign will not succeed. As a result, we are offering to speak to the Spanish Tax Office on behalf of any clients who have doubts to ascertain whether or not they are eligible and get the forms they need."

How can the Spanish keep getting away with it ?

This is just another example of where the Spanish authorities are doing exactly as they please with total disregard for European Law. The I.B.A. receives more reports about Spanish corruption and blatant theft from the authorities, than the rest of the world combine.

The countless officials that are being arrested on a weekly basis on corruption charges is ridiculous, sometimes the entire command chain within the town-hall are being arrested at once, we refer to the most recent Marbella and Estepona incidents!

The previous Mayor of Marbella was responsible for the building of thousands of illegally built apartments, leaving Britts and other foreigners without the correct house deeds and other such paperwork.

The present Mayor has recently been arrested and a suitcase with close to one million Euros was found under her bed, of all places !

From government officials, right through the Spanish Police forces and the Guardia Civil, whenever they are backed into a corner and their corruption is exposed, they either give you the run-around, or totally blank you in blatant ignorance.

They are of the opinion they are answerable to no one, we think this stems from the days when Franco was in charge, and the entire race were forbidden from questioning authority, suppressed and unable to think for themselves.

The endless reports we receive boil down to the same thing, the Spanish offer no customer service, no value for money, no help to foreigners whose money and entrepreneurism have built the Costa del Sol and their tourist industry, and their whole system was built on, and still revolves around corruption.

They now find themselves in the position of totally pricing themselves out of the tourism market, this mainly due to not reinvesting in infrastructure. People are no longer prepared to pay top dollar for worse than poor service, the end result being that, the Spanish have totally shot themselves in the foot and destroyed the only thing they had going for them.

Maybe they’ve got their just deserts?

Emerging markets improve transparency

The research revealed that in 2008, eight countries moved up a full transparency tier since the last index in 2006. Dubai, Romania, Ukraine and Russia showed the biggest improvements in transparency over the last two years.

In keeping with 2006’s results, the Australian and US real estate markets remain among the most transparent in the world. The report said that Canada’s, this year’s number one, elevation to the top of the chart comes after the addition of new variables relating to the quality and frequency of valuations, service charge transparency and financing transparency.

The Index, which provides a framework for comparing the level of real estate transparency in 82 markets around the world, shows that nearly half of the countries surveyed in 2006 demonstrated a significant improvement in their transparency score two years later.

Transparency levels globally are improving as governments seek to streamline regulatory and legal hurdles to aid cross-border movement of capital and corporate facilities. Only Venezuela posted a lower transparency score this year compared with 2006, principally due to changes in government regulations and new taxation policies targeting foreign investors.

The steady improvement in transparency, particularly over the last four years, is closely linked to the forces of globalization that drive investors to move across borders in search of higher risk-adjusted returns. Global strategist remark "This movement of both capital and corporations around the world has created an even greater need for information about markets. It has also created an incentive for governments to streamline bureaucratic practices which prevent the free flow of capital into and out of global markets."

"Many cross-border investors focus on more mature, open and transparent real estate markets such as the UK, Canada, Netherlands and Hong Kong. However, opportunistic investors will consider the emerging, less mature, less open and semi-transparent markets, but will require higher returns to compensate for the higher risks associated with lower transparency. Only the most opportunistic investors will consider semi-transparent markets found in Eastern Europe, Latin America and Southeast Asia. Opaque markets, such as Algeria, Belarus and Cambodia, are still very problematic," he added.

The Index shows that 28 countries posted transparency scores that were within 10 basis points of their scores in 2006. Jones Lang LaSalle researchers say that consistency in transparency scores over the years is expected in real estate markets such as Australia, the UK, the U.S.,

Singapore and Hong Kong where a high degree of transparency already exists. However, countries such as Argentina, Greece, Indonesia, and Peru have consistently scored in the low transparency range over the last few years despite an increase in cross-border trade, finance and commerce over the same time period.

A number of countries in the 'frontier markets' have been included in the Index for the first time, with Belarus, Sudan, Algeria, Cambodia and Syria scored as 'opaque'. Other new entrants into the Index, Bahrain, Bulgaria, Estonia, Latvia, Croatia, Abu Dhabi, and Lithuania, scored in the 'semi- transparent' range, while Oman, Qatar, Morocco, Kuwait, Pakistan and Kazakhstan all scored in the 'low transparency' range.

Top Ten Most Transparent Countries 2008

Largest Transparency Score Changes 2006-2008

New marina for Pathos

A spokesperson for Leptos told OPP that the marina project would cost over €70million to build and include a substantial residential component, leisure facilities and a 1,000 boat capacity.

Announcing the news, Commerce Minister Antonis Patsalides revealed that the marina would be built in the Potima area of Paphos and said that competition for the project had been stiff between the front-runners, with Aristo believed to be the other main bidder.

The winning consortium, alongside Leptos, is made up of Cybarco, JNP Avax, Francoudi & Stephano and Athena & KAT.

Conditions of the contract state that work must begin on the project immediately with completion due in three years. The consortium will have to pay the government an annual rent of €4million for 19 years.

Regional development

The Paphos marina is just the latest in a long-line of new development projects that have been awarded, or are due to be allocated in the near future.

In February the Cypriot government awarded another consortium consisting of J&P Avax, Cybarco, Frangoudi & Stephanou, Ioannou & Paraskevaides, Athena ATE, CADS Holding Ltd and the Limassol Chamber of Commerce and Industry through the Limassol Marina Development Company, the contract to build the new Limassol marina.

Also containing room for 1,000 berths, the Limassol Marina will comprise of residential, dining, shopping and conference spaces and will cost over €170million to build.

Cypriot Tourism Minister Antonis Michaelides said at a recent press conference that the contract to build a new marina in Ayia Napa is also due to be awarded soon and that the Ministry is in ‘advanced negotiations’ for the 600-berth development.

The Cypriot government believes that the marina developments being built around the country will help give it an edge over Israel, Greece and Turkey as the region’s sailing hub.

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