Cyprus property sales for the year rose 20%. Restoration of the Spanish property market is “low start”. The Swiss franc rose against the euro by 30%. We present a selection of the most important news of the week with the comments of market professionals.
Cyprus property sales for the year rose 20%
By results of 2014 on the island is not just fixed the rise in sales, it was the first time since 2010 and just two dozen percent.
Over the past year, Cyprus has been made 4527 transactions, and in 2013 – only 3767.
As before, most of the purchases in 2014, namely the 3334 transaction, falls on the local market. And around 1200 acquisitions made by foreign investors. This is 26.4% of total purchases. Recall that a year ago this figure stood at 1,017 transactions.
The results of the past year, experts inspire positive forecasts for 2015. Many believe that the strong growth will continue in the new year. However, prior to peak performance Cypriot market is still far. Compared with the level of sales recorded in 2007, the current results are 78% lower. A low demand negatively affects the local construction sector. The volume of construction of new homes fell for for a long time.
We asked Regina Campton, representative of the company «ABC Cyprus Homes», the reason for such a sharp rise in sales in Cyprus in 2014. And that’s what we heard: “there was a jump in sales due to rising British pound by almost 30% against the euro. Accordingly, the British became advantageous to buy property in Cyprus.
In addition, buyers from China and the Middle East, Cyprus attracted by the possibility of obtaining citizenship and residence permits, and the same applies to buyers from Russia, Ukraine and Kazakhstan.
Property by the sea or in the mountains overlooking the sea is the most popular, and there is a shortage of such facilities. ”
Restoration of the Spanish property market is “low start”
According to analysts , in 2015 it will begin the long-awaited recovery of the property market in Spain.
This opinion was expressed in the newspaper El Mundo. Experts predict a rise in demand for housing, driven by stable prices, cheap and available credit, and increase the supply of new construction projects.
However, analysts warn about some problematic points. “During 2015 the Spanish property market will develop unevenly. On the one hand, there are regions where prices have stabilized, but on the other hand, are the areas where the price correction will be more modest, “- said the expert Julio Gil.
Another expert, Gonzalo Bernardos, said that buying activity will peak in big cities, mainly in Madrid and Barcelona. He even predicts growth in housing prices in these cities by 10%. “This is a significant rise in prices will contrast with stable prices in the medium-sized cities and stoilitsah Spanish provinces” – he adds.
One of the factors that encourage recovery of real estate market in Spain, will be the launch of new construction projects, experts say. Developers will again begin to build housing. Demand will be driven by a large selection of objects.
Dmitry Ivanov, representative of the company «Dilani Businessgroup», agrees with forecasts of analysts: “The increase in prices is indeed highly dependent on the region. Already we started to appear new development projects in tourist areas. Prices in Barcelona has stabilized, possibly in 2015 for some sectors can be seen some growth. 10% – this, I think, is unrealistic, but in the area of 4-6% may well be.
If you look at sitautsiyu in general, it is necessary to share the moment in the euro area and the situation in the Russian Federation. The general situation plays into the hands of the Spaniards soon, for reasons such as the falling euro against the pound (English more intensively make purchases), increasing confidence in the achievement of the bottom, waiting for growth.
Concerning the Russian Federation is a significant net depreciation of the ruble. Although, seeing the results of the beginning of January and February the number of customers, I can say that was expecting the worst. According to my information, there is a lag of demand, but it is not catastrophic. ”
The Swiss franc rose against the euro by 30%
It was January 15, 2015 after the country’s National Bank has canceled a minimum threshold of the exchange rate, introduced in 2011.
Swiss National Bank (SNB) is not only unexpectedly canceled the ceiling exchange rate of the Swiss franc against the euro, but also lowered the discount rate from -0.25 to -0.75%.
In 2011, to combat the effects of the global financial crisis, the board decided SNB set a minimum exchange rate of the euro / Swiss franc at 1.2000. The controller then explained that the need to support domestic exporters. And now the minimum threshold of the exchange rate has been canceled.
The euro against the franc has led to the depreciation of the European currency. So, against the dollar it fell to $ 1.1579 – its lowest level since November 2003.
I wonder what impact the strengthening of the Swiss franc on the Swiss real estate market? After overnight local square footage for Europeans grew by 30%. His vision of the situation outlined Irina Chernova Burger, representative of the company «RUS 2 SWISS Immobilien GmbH»: «Cancel artificially low rate of the Swiss franc against the euro has forced the Swiss, in the words of one journalist,” to laugh and cry at the same time. ”
Because of the strong Swiss franc affected manufacturers exporting products to consumers as from abroad has become more expensive. He suffers from tourism, for depreciation of the euro deterred winter sports, hotels are not filled this winter. On the contrary, winning the Swiss who live on the border with the European Union: the products in the border supermarkets have become cheaper as a result of flourishing “shopping tourism.” Finally, lower interest rates on mortgages fell again and are approaching the record of 1%, which is beneficial to all those who purchase housing with a mortgage lending – and this is how the Swiss and foreign buyers. Those Swiss or foreign individuals or legal entities, who to date has acquired a property in Switzerland can state with satisfaction the fact: the growth of the franc automatically led to increase the cost of facilities.
Swiss economists try to figure out how to free flight of the Swiss franc could affect the Swiss real estate market in the near future. They go to a conclusion that is no reason to worry. If the country was in recession, ie negative growth for at least two quarters in a row, it would be different. But this trend is not observed, on the contrary, the economy is showing strong growth. And this year the growth will continue.
A particularly positive influence on the development of the Swiss real estate market has further lowering of interest rates on mortgage loans. But it is only within the country. For foreign borrowers situation looks different. In the early 2000s, many borrowers in European countries – Poland, Germany, Austria and other countries – have debts of its banks in francs to finance the property outside of Switzerland. In those years, the interest rates in Switzerland were significantly lower than in the domestic market. The danger of being subjected to currency risk is probably of secondary importance.
For foreign holders of mortgages in francs today is a blow to their own goal, “let go” franc has led to a rise in the cost of foreign mortgages by 20%. Not only the euro but also the Hungarian forint, Croatian Kuna and the Polish zloty have suffered due to the cancellation policy of containment of the course of artificial shveytsarskogo franc. More precisely, the owners of the mortgages in Swiss francs of these countries.
Anyway, today the Swiss franc is a strong currency, and investments in Swiss real estate continues to attract foreign investors for various reasons. “