Residential real estate in the south of Europe continues to become cheaper

25.07.2010 16:26
Real Estate Market Analysis | Residential real estate in the south of Europe continues to become cheaper Almost half of the world housing prices continue to fall.

For example, in Spain in the I quarter of 2010 the average cost of housing units, according to the National Statistics Institute of Spain, for the year decreased by almost 3%. In Sofia (Bulgaria) in the II quarter of 2010 average price of apartments amounted to EUR870 per square. m - 15% less than a year ago.

However, the pace of decline in most cases markedly reduced, indicating a gradual stabilization of the market. However, increasing demand for real estate by foreign nationals. For example, in Cyprus, where the results of 2010 the average price of apartments, according to forecasts of the Central Bank of the country, reduced by 4%, the number of purchases made by foreigners has increased this year by 7%.

Ukraine are looking to buy property near the sea - it is an opportunity each year to rest himself, and take shelter in rent. For example, about 40% of clients are interested in West-Realty apartments in Bulgaria, another 35% - in Turkey, 20% - on the coasts of Egypt and Croatia. The company Vasko da Gama & Ea San more than 27% of transactions accounted for Turkey, about 17% of customers prefer to Egypt, more than 15% buying property in Cyprus. While in Ukraine, many buying property abroad is still considered something of fantasy, but in practice many of the popular resorts of the cost of apartments today are markedly lower than on the Crimean coast. "The appetite of developers in the Crimea simply indecent, - confirms sales director West-Realty Victor Pshenishnyuk. - Prices for the objects is much poorer quality here at least twice higher than at most resorts untwisted the same in Turkey.

The popularity of the local apartments also largely due to the lack of visa difficulties and simplicity in the design documents. For example, in Turkey since the decision to purchase the buyer pays 5-8% of its total cost and receives a month for reflection. If during this time the client changed his mind - he is fully refundable deposit. If you decide to buy, makes another 80-85% of the price. For a builder or seller signed a contract drawn up a plan of the building, floor, flat, created maps, make a copy of the passport buyer. Documents sent to the local military authorities in Izmir. Consideration of application for Ukrainians lasts two months. When it comes to authorization, the client pays the remaining amount. To buy an apartment in Egypt, the buyer also needs to have only a passport. In fact, registration of the transaction takes no more than three hours. About EUR1 thousand to pay for the reservation of the object. The remaining amount can be transferred by wire transfer within two to three weeks.

According to market participants, the number of Ukrainians who buy property abroad, is growing every year. "We have better focus on international real estate markets have begun with great deference to him and understand that the purchase of foreign houses or apartments - is the acquisition of a new social status, - says Yuri Nesterov, head of the consulting center GC Vasko da Gama & Ea San. - The authority of the foreign market, in contrast to the national increases. Ukrainian investor without a headache and any delay is rapidly becoming a much better shelter than at home. The database consulting center around one thousand residential and commercial real estate from developers in more than 30 countries worldwide. Two years ago, the objects of the same construction company was a third less. "The foreign property market, especially Egypt and Turkey, are very sensitive to the interests of their potential customers, create new construction projects and quickly implement them", - says Yuri Nesterov.

Director of Strategic Development Investment Group INEKO Alexei Oleynikov agrees that in terms of investment security today is the most favorable for investing countries - Cyprus, Bulgaria, Croatia, Malta and Turkey (in descending order of risk). "This is not a rating of the attractiveness of countries as an assessment of their investment security, based on an analysis of economic growth, the dynamics of macroeconomic indicators, investment climate, the sovereign credit rating, assessing respondents' outlook for investments in this region, and so forth." But in terms of profitability, according to experts, foreign real estate today is not the best option of investment. "If an investor wants to diversify their investments or specialized in this segment of the business, then to urortnaya real estate may be subject to capital investment. In other cases, while investing all their savings or their significant part in overseas real estate, I would not recommend - he says. - Alternative investment in post-crisis period, which, along with significant risks can bring even in the short term, high income. For example, venture projects, industrial lines of business, the stock market. Do not hurry to judge and with the purchase of housing exclusively for personal purposes. It is still too high risks associated with the revaluation of property values in individual countries, as well as with the difficult situation in the European banking system. In many countries prices continue to fall, there is time to look. The main thing - do not miss the moment when the country you are interested, they would crawl back up.

The unprecedented vacation
In recent years the Ukrainian market are increasingly found the proposal to purchase real estate in the young resort areas - where its value is lower than rates on the well-known resorts of at least 30-50%. They have already managed to take a fancy to the Europeans, the British and Scandinavians, are actively buying up apartments here. For example, according to the company's West-Realty, in Balchik (town in northeastern Bulgaria, 50 km from Varna) for EUR12 thousand to buy apartments with total area of 30 square meters. m (EUR400 per square) with one bedroom in a gated five-story complex with swimming pool on the first line. For comparison: in the most Varna price per square meter of apartments of a similar class at 50-100% higher - EUR600-800 per square. m. p Iona Fethiye (Turkey) decent villa costs from EUR65 thousand cost of a similar object on the untwisted to urorte will be not less than EUR85 thousand

Developers Assure: buying an apartment in that region today, you can recover attachments, simply handing it in rent. According Bahrettina Bitkaya, director Asem Сonstruction Development (part of the British-Turkish Asem Group), the cost of weekly rental apartments in the simplest little-known to urorte Turkey Didim is about 150 pounds a week (about EUR180). Given that n lyazhny season lasts almost six months in the country - from May to October, with a successful combination of circumstances and the constant presence of tenants on the lease every year you can earn about EUR4 Thousands As a result, buying an apartment for EUR30 thousand, theoretically recoup these investments can be for Seven or eight years. But first, some of the money earned to pay for water, electricity, and secondly, something for those seven or eight years will inevitably have to spend to repair or furnish, and third, no promises an influx of guests. And the servants of the management company, which will take care of the apartment, to help in finding clients and accompany them to cost more at least EUR300 a year.

Also, buying apartments in places you should be prepared for possible disruptions of water supply, windows overlooking the adjacent construction site, the lack of Russian-speaking population (a problem for those who do not speak English). Or the lack of direct flights to a nearby airport: will either have to fly with changes, or after the plane half to get to the final destination by road.

Victor PSHENISHNYUK, Director of Sales, West-Realty (Philippines):

By: Where the Ukrainians are buying properties most often?

- With a big lead ahead of villas and apartments, located on the coast. The wealthy Ukrainians are buying them not only to carry out on a resort holiday with your family at any time of year, but for a permanent or long-term (two to three years) of residence after retirement. It plays an important role climate, air and the atmosphere the area in which property is located. In addition, upon delivery of the object in rent for nine or ten months a year of specialized investment company can pay for themselves within eight to ten years.

K: What is the demand for the most popular with our tourists to urorty Turkey, Egypt and Bulgaria?

- In our company in the first place Bulgaria - her preference for 40% of clients in Turkey, apartments and villas acquire 35% of buyers in Egypt and Croatia - 10% each. The popularity of these resorts is primarily due to the simplicity and transparency of the documents giving the right to own property, and the possibility of obtaining a residence permit in the future. For all other countries account for about 5% of sales, demand for them is irregular, mostly we make individual applications to find objects with the required parameters.

By: growing the demand for real estate in the little-known regions of these states?

- Little-known regions have limited demand among people seeking peace and quiet. As a rule, buyers of retirement age. Younger people are interested in the first place a good infrastructure and the opportunity to have fun.

Bahrettin Bittkau, CEO Asem Сonstruction Development UK LTD (UK-Turkey)

K: As far as real estate prices in the little-known regions of Turkey following rates for well-known to urortah?

- On average, 50%, sometimes several times smaller. If in Didim (young resort on the Aegean coast. - Approx. Ed.) Two-bedroom apartments can be bought for $ 50 thousand, in Antalya is the same apartment could cost $ 100 thousand

By: The difference in price because of the different margins?

- No extra charge can not be above 30% throughout the country. The price of real estate depends mainly on the value of the land. What is less popular area, the cheaper the land. For example, resort Bodrum has been known for nearly 30 years, Antalya - 50 years. Didim is just beginning to evolve and become popular. In 2003-2004. there was not a single 5-star hotel. It has been working for three. We construct a marina, there are roads, but no traffic lights everywhere. Around the world in places such real estate is cheap. But it will be more expensive.

K: What part of the Company's facilities Asem bought the Ukrainians?

- We have sold 90% of our apartments, mostly British. From Ukrainians entered so far only two contracts, a few more in the conclusion. Largely prevents the language barrier. In the young Turkish resorts do not speak in Russian, but Ukrainians poor command of English. And few people in Ukraine are aware of the regions where we operate. But I think gradually with the increase in their popularity number of people wishing to buy apartments, for example, in Didim will increase.

Ksenia Portnaya, Contracts
Content tags: Overseas property Housing
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