Owners of large land mass began to throw them up for sale

16.10.2008 00:00
No longer relying on profits, the owners of large suburban land mass began to throw them out for sale. Plots in the suburbs of the capital are rapidly losing in value. The owners of large sites for commercial development are ready to give buyers a real one-third the price. A little less down the price of plots for building villas. Yet experts say that the land has ceased to be an instrument of investment, bringing sverhpribyli.Tseny to suburban areas for the first time in seven years, ceased to grow, and in some positions even begun to sink slightly. According to the company Knight Frank, lower prices for large parcels of land for commercial development in the first half of an average of 8% and some areas immediately fell by 25-30%. The company Build & Live Development supplement, which is now on sale there are sites that cost is reduced by half. "If in the spring of this year, large areas (several hectares) with an exit to the highway within a radius of 10-15 km from Kiev were offered at $ 7-9 thousand per hundred square meters, now the owners have already agreed to sell them on at least $ 3-5 thousand for weave, "- says CEO of Build & Live Development Victor scorner.

Main reason - the glut in the market and exit of buyers. Land under large-scale projects more promises of super-profits, and its owners en masse display their assets for sale. According to the Moscow Academy of Sciences "trajectory" from the beginning of autumn in a closed sale issued thousands of hectares of land, control of which are former collective farm chairmen and heads of village councils. Huge land lots put up for sale as development companies that the credit crunch in need of funds to finance their liquidity more projects within the city. According to CEO Link Development Jaroslav Tsukanova, if earlier highly the company's facilities could be financed by loan funds, but, for example, land assets are not yet fully developed projects to keep in store, now offered by banks rates reduce the attractiveness of even highly projects to zero, and developers are forced to sell part of their project portfolios. "For large and medium-sized real estate developers are now much more important to have funds for ongoing projects, primarily office and retail, from which is still possible to get a good profit than to have a lot of land holdings and to be unable to digest. So now most companies are trying to get rid from their land, "stocks" and projects at the initial stage of implementation. And the oversupply of provoking a sharp decrease in the value of holdings. The process is already underway, so wait for their owners have nothing "- note in the Renaissance Capital.

The shortfall is putting pressure to get rid of parts of speculators, but that is the main reason for the lack of buyers. According to the General Director of Ukrainian office of Knight Frank Yaroslav Chapko, a land that offered large arrays is speculative pricing, and often prices are so inflated, that the real estate development of any object not stand them. In addition, due to many unresolved issues in the land sector, potential investors are now too great a risk. Therefore, to find a real buyer, we have significantly reduced prices.

According to experts, the cost of large land parcels for development will require huge financial resources continue to decline even further. More likely, experts say, will drop plots for construction of cottage townships, since, according to experts SV Development, 80% of them are unsuitable for the consumer and the market itself there is a glut of cottage townships. Reduce the cost of such holdings, according to Deputy Director of the Academy, "Trajectory" Marina Belchuk will also contribute to the lack of bank lending in this area, and inadequate infrastructure in terms of almost all suburbs 30 - kilometer zone around the capital, with the exception of the Obukhov direction.

As for the segment of the sale of small suburban plots for construction, then, according to EA, "Trajectory", while the average of their value continues to increase slightly (by an average of 0.5% per week) on the market have appeared recently Proposition 10 - 15% lower than in summer. Nevertheless, experts agree that this segment is unlikely to wait a rapid collapse, because most of the proposals will be withdrawn owners (individuals) with the sale until early next season - February and March next year.
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