Ulidia
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Posts posted by Ulidia
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Hold on and buy a studio in the Uk if I were you, forget developing nations which will shortly be taking retrograde steps backwards to return to third world status, once the global economic system has finished its crash, and even the IMF is brassic. Does on somehow think that the Phillipines will escape this unscathed? The middle class renters there will suffer, the Japs won't be investing any more and the whole of SE Asia will get back to its traditional near-past industries of people/drugs trafficking and the paddy fields.
I'm not a 'blind faith' defender of the Philippines .... it has a hell of a lot of problems and, from my perspective, investing in property in the Philippines is something akin to Russian Roulette. If you're prepared to gamble with money you can afford to lose, then go ahead and invest in real estate there .... all the more so if its a lifestyle purchase.
That said, I think you under-estimate the status of the Philippines compared to the UK .... i.e. the Philippines is undoubtedly a second world country but it already went through its own version of the current crisis in 1997, with the result that banks there have very conservative lending policies. The availability of money is limited and the cost of it is high with the result that property speculation has been limited ..... property prices in Metro Manila are still circa 50% less in real terms than at the start of the 1997 crash.
Are there risks to the Philippines' economy as a result of the global crisis? Sure, but it doesn't relate to Japanese investment. Very few Japanese invest in the Philippines. Rather, the risk is a slowdown in investment from the Chinese and the Koreans (Koreans have bought up whole condominium projects in the recent past) and, furthermore, that the Philippines economy will receive less foreign remittances from the legions of Filipinos working abroad, espeically in the US and Dubai.
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I have got a solicitor checking out the ownership and rental guarantee issues in particualr that it comes with 60% developer finance who is also providing the guarantee on a back to back basis
Developer finance is fairly standard in the Philippines.
Most developers offer interest free finance spread out over the term of the construction period. In addition, some developers offer longer-term developer finance (i.e. pay, say, 40% of total over the construction period and then the remaining 60% spread out over a 5 to 15 year period).
Note, however, that the longer-term developer finance is typically priced at very high rates of interest - certainly a minimum of 15% but I've seen rates of up to 20% quoted (this isn't overly surprising when its noted that even conventional mortgage financing offered by banks in the Philippines tends to be at rates of 12% or above).
If you are looking at a Philippines property purchase on basis of a holiday home, then a Boracay studio could certanly be worth considering. However, if you are looking at it from a pure investment perspective, then I would consider some of the Metro Manila condo units / apartment units offered by either Cityland or DMCI Homes.
Cityland and DMCI Homes have proven track records at building condos for the mid-price market .... typically these condos offer fewer shared facilities / amenities than the higher priced condos and their finishing tends to be more basic. However, its the mid-price market that is in most demand locally, due to the growing population and growing middle-class (though impact of global downturn has yet to be felt in Philippines) so these condos are easier to rent out and, unlike the holiday spots, its possible to rent the unit out for 12 months of the year.
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Hi
Have just read details on this resort - (you can google it) with brilliant sounding returns
Has anyone invested or any experinces here
Would love feedback Thanks
I like the Philippines a lot (I live in Makati, Metro Manila on a semi-permanent basis).
However, I wouldn't touch anything that provided a guaranteed rental return, least of all a return as high as 19.5%.
(Gross) rental yields can be high in the Philippines, but that is more in the Metro Manila area (potential for rental income over 12 months, rather than the tourist areas where rental income is very seasonal) and, even then, 19.5% is unheard of.
The other thing to bear in mind regarding a potential purchase in the Philippines is that the peso has strengthened significantly vis-a-vis sterling over the past 6 / 7 months, with the result that prices now look high to me .... i.e. most of the new build studios in the coastal resorts are being priced from £55k and above. Instinctively, that seems high to me compared to prices in other countries with similar levels of infrastructure.
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http://www.moneysupermarket.com/community/...spx?PageIndex=7
similar thread on another forum , you are not alone
suprising how many people just wanted a home and not a quick profit
I read the last page or two of that thread and got increasingly frustrated, esp the following two summary bullet points from a meeting of a group of purchasers:
- Another common theme is that people were not made aware, either by the developer-recommended lawyers or those who used independent lawyers, that they were liable for more than just the deposit paid but could be sued for for potentially the total costs of properties. Is this misrepresentation and therefore a basis to sue/nullify contracts? Are the contracts deemed legally reasonable?
- Many investors bought to live in. If investors can find a way to own these properties then they will complete, but to complete on a property that has devalued by a third or more at the full contracted price of 2 years ago is financial insanity. The housing market is not going to recover for many years and individual investors would be left with a large financial burden instantly putting themselves in a position of substantial negative equity.
It seems that these buyers wanted all of the potential upside opportunity of purchasing off-plan property that is due to complete in a few years time but either buried their heads in the sand as to the downside risks of such a purchase and / or believe that they should be able to walk away without suffering some consequences.
There doesn't seem to be much humility i.e. "I made a mistake" or "I took a gamble and its backfired". Rather, the tone of the thread was largely that it was the fault of others (Developers, Lawyers, Banks) and, whilst thats' partly true, a bit of self-reflection is also required.
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While I am very aware the ROI is another legal system this thread on the Pin appears to say that the Commercial court in Dublin is enforcing contracts.
http://www.thepropertypin.com/viewtopic.ph...29&start=60
I don't know if the developer of TQ has a legal entity in ROI to be able to sue from there if it was more favourable.
The developer, Harcourt Developments, does have a RoI legal entity. However, I would be very surprised if the contracts for the TQ apartments do not contain a clause stating that they are subject to the law of Northern Ireland i.e. in such circumstances, Harcourt Developments would be unable to sue defaulting TQ buyers in RoI.
That said, contract law in both NI & RoI is primarily based on the same common law principles so it is unlikely that the approach of a court in NI to the issue would be significantly different to that of a court in RoI.
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The mortgage, which was launched last September with the backing of 10 developers, is aimed at getting first time buyers back into the housing market with its no deposit package, and protection against plummeting house prices.
First time buyers don’t need a deposit with the Momentum Mortgage as 5% of the house price is contributed by the developer. In addition, the home loan has up to 15% protection against house price volatility.
If the value falls by up to 10%, the mortgage is also reduced by 10%.
Who knew 100% mortgages were still available?
Its somewhat sobering to think that any purchasers who agreed to purchase properties under this scheme last September / October are likely to already be in a negative equity position, irrespective of the "15% protection".
In any event, it is somewhat inaccurate for the article to mention "15% protection" as, other than the 5% developer contribution, any reduction in the mortgage amount (up to 10% reduction) will not take effect for 5 years.
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http://www.ft.com/cms/s/0/591a258c-eef3-11...00779fd2ac.html
Can anyone interpret these graphs please. To my untutored mind they appear to be talking about lending going back to low multiple of salary.
The graphs are actually showing that there hasn't been a significant change in the income multiples that have been granted by lenders since early 2007 i.e. the proportion of loans given at above 3.5 times a single salary or above 2.75 times a joint salary has not decreased significantly over the period.
However, the graphs are also showing that there has been a noticeable change in the type of mortgage business i.e. considerably fewer "new" mortgages to finance house purchases, but rather remortgages are now making up a much greater proportion of the mortgage market. In addition, whilst there are fewer BTL mortgages being granted, the fall in BTL mortgages is not as large as I would have anticipated, given anecdotal information etc.
The third graph shows that the amount of mortgage arrears has more than doubled since early 2007, but that to date, there is little evidence that the lenders are working with those who fall into arrears on alternative payment plans etc.
Each of the graphs are of some interest, but they do not tell a great deal when viewed individually i.e. whilst income multiples are important, it is the increasing % deposits required by many lenders, and more prudent valuations of property, that (I believe) is having a greater impact on the mortgage market to date, not to mention the impact of a vastly different (i.e. much more negative) market sentiment.
In addition, whilst it would seem that the change in lending on basis of income multiples has not been significant, I imagine the fall-off is much greater at the very high income multiples (i.e. 5 times salary etc) but this isn't illustrated in the income multiples graph.
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The three things that I found better 'over there' were football (very important to me
), career opportunity (and reward) and pubs!I agree with you on the career opportunities and pubs.
However, Irish League football can be strangely alluring if you give it a try
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auction tonight. strangely wilsons have added a few last minute. doesnt give much time if something takes your fancy!
anyway this is nice. me and the girlfriend are 25 and this would appeal at this time in our life.
http://www.wilsonsauctions.com/property_de...w.asp?id=210371
so how much do folks think this is worth/going to be worth?
be interested to hear your views.
thanks
I'm not going to try to estimate how much its worth.
However, I know the development and its very nice - it is noticeably superior to the nearby Margarita Plaza and Bass Buildings and somewhat superior to the nearby Wintergarden complex. The living space and bedroom sizes are generous by Belfast apartment standards.
In addition, it appears to be mainly owner occupiers / professionals, rather than students or short-term lets which, in the long-run, can prove to be very important in apartment living in terms of the quality of life and preservation of longer-term value (maintenance of building etc).
If I were to consider moving back to Belfast, Central Park is one of a small number of apartment developments that I would potentially buy into (others, off the top of my head, that I'd potentially also look at are Greggs Quay and Stranmillis Wharf).
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Mayb i'll wait for the new release...i'm hoping to buy a house through co-ownership i think their maximin is £175,000 and the max i can get a mortage is about £150,000...so it will depend on the revised price. I was going to buy in curzon on the ormeau road at a discount but they sold them to the housing exec...
Out of interest, do you recall the level of discount that you were being offered vis-a-vis the original selling prices at the Curzon development?
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Am pretty sure Ulster Bank are providing the funding for the Arc.
Yes - Ulster Bank won the tender for Phase 1 of the Titanic Development.
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wonder what bank they use (if any) in the ROI.
Most of the larger developers in RoI use a number of banks for their projects i.e. they will have close relationships with a number of banks and its normal for a large project to be funded, in part, by two or more banks.
I'm not sure which bank(s) was / were providing funding for this project. However, I'm aware that Harcourt have traditionally had a close working relationship with Anglo-Irish and KBC Bank (previously known as IIB). Bank of Scotland (Ireland) have also provided funding for some of their recent projects.
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I contacted my lender again but was told to come back about 4 months before completion. I complete at the end of 2009 and need to borrow less than 2 times salary. Has any buyer a firm mortgage offer in place yet?
Under normal circumstances even in today's environment, assuming its for purposes of your primary residence, you would have no problem securing a mortgage of 2 x salary.
However, the complicating factor in this scenario is that the security being offered (i.e. the apartment) will likely have a market value significantly lower than the mortgage amount i.e. assuming that the market value is assessed at 40% below contracted price and you're making a deposit + downpayment in region of 20%, then a lender is looking at a significant exposure (minimum of 20% equity, but likely more in the case of a forced sale in a weak economy, plus all related costs) in the case of buyer default. Assuming that the economic downturn continues during 2009, with the impact of rising bad debts and repossessions, I cannot imagine that its a scenario that would be palatable to most lenders.
Instinctively (I'm a banker but not a lender so have no personal inside track), I'd say that anyone looking to complete on one of the new build apartment developments would need to be looking at contributing circa 40% of the original contract price to secure a mortgage for the remainder.
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Assuming that €750 per month is a fair market rental rate for this type of house in Wexford, then it seems an innovative scheme and one that offers want to be buyers an opportunity to enter the housing market with minimum downside risk.
Hopefully, we'll see more innovative schemes from developers as it is in no one's interest to have ghost estates littered across NI or RoI.
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I was reading somewhere on the main forum about neg equity being carried on to next mortgages in the 90's recession
was one way to get things moving
trading up I guess it would be acceptable as it could be weighed against your saving on the next place
It may happen. However, looking at it from a lender's viewpoint, I cannot see why they would allow this under most circumstances in today's market when further house price falls are anticipated.
For example, Person A has negative equity of £30k on a property and wants to move up the property ladder by buying a house @ £200k. However, all indicators suggest that house prices will fall further, so although Person A moves into his new property carrying a negative equity of £30k, any fall in the value of the new property will simply be carried over into the negative equity .... i.e. a further 20% fall would increase the buyer's negative equity by £40k to £70k and, thus, significantly increase the exposure of the lender.
Its partly due to the anticipation of further price falls that lenders are insisting upon higher deposits i.e. to limit exposure to negative equity scenarios.
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Genuinely hope it all works out but, IMO, I'd talk to the developer sooner rather than later.
but what if their response is the same as their response to michaelmack: 'not our concern..if you don't complete we come after you'.. What is the way forward if you recieve an unconditional FO like that?
Well, its somewhat unchartered territory, given that the 10% deposit itself was likely sufficient to secure a mortgage on new-build apartments until recent times. There's differing legal opinion as to the likely approach a court would take so, for all the theoretical scenarios discussed on this thread, its important that you get independent legal advice sooner rather than later.
Developers will be well aware that many buyers will have difficulty completing and I'm sure that they are taking appropriate advice to ensure that their own interests are protected. Whether the strategy is one of "I'll see you in court" or a more concessionary approach is, I imagine, dependent upon each developer and their own circumstances (and the stance adopted by their own bankers).
However, whilst I'm not a developer, I'd be pretty sure that a developer would look less favourably upon a buyer who buried their head in the sand until completion, rather that a buyer who gave reasonable notice of potential difficulties at the earliest possible opportunity.
Actions:
a ) take legal advice;
b ) subject to the legal advice, commence dialogue with the developer at the earliest possible opportunity.
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Does anybody have any feelings on what they predict the drop in value to be from agreed price to surveyors valuation? Imho it is probabaly around 25%. Also, does anbody know if a mortgage is likely to be available with a 10% deposit given that is is new build etc?
I would say that the differential in valuation (if the development was completed now) today vis-a-vis agreed price would be more than 25% given the drop in house prices and the speculative nature of many new build apartment developments. I'd be surprised if it wasn't in the region of 40%+.
As for mortgage availability with a 10% deposit? No chance for a BTL mortgage. For a residential mortgage, it would be more conceivable but still unlikely, given many lenders are currently looking for 20% deposits or higher. Furthermore, lenders will be much more cautious lending against apartments than houses, even where its a residential purchase, given that apartment prices are generally more sensitive to price volatility, esp in a falling housing market.
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I think it is however realistic to estimate that a flat bought for 250k in 2007 may be valued at around 150k by the lenders at the moment...a very depressing thought.
I'd agree with you regarding the likely fall in the assessed value vis-a-vis purchase price at peak. In fact, given the fall in house prices over the last 12 months, together with likely continued falls in house prices during 2009 and the particular sensitivity of lenders to new build apartments in today's environment, it could be worse than that upon completion.
Add to that the significantly higher deposits required for mortgages (especially BTL mortgages, which will be required by many of the James Clow purchasers) and its a daunting situation for all involved - contracted purchasers, employees of the developer and so on.
Genuinely hope it all works out but, IMO, I'd talk to the developer sooner rather than later.
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Surely if it goes to court someone will take pity on us. I know they need to make a profit but when they planned these apartments way back in 2003(or before) they had no idea how high the market would climb....I bet they envisaged getting a lot less for them than they actually did so I can't imagine it would hurt them too much to knock 100k or so off the price! (in fact I seem to remember that on the day i queued up to buy one of these that when they had all sold they released another batch then and there at higher prices...they had no idea they would make so much and I bet they would still be well in profit if they sold at 2005 prices). So if they take us all to court hopefully the judge will recognise they could have a healthy profit if they agree to renegotiate and sell to us at a price that will not ruin us completely/force us to go bankrupt etc. Am I being too optimistic?
I think you are being too optimistic and too simplistic. Your scenario is more of an arbitration one than one of contractual law. That's not to say that the developer will try to enforce the contract (in fact, this would likely be self-defeating where the defaulting buyer cannot complete). If the developer does try to enforce the contract in such cases, the best scenario would be that the court views the loss of the deposit as reasonable damages for the contractual default.
I would imagine that it would hurt the developer significantly to discount units to agreed buyers by an average of £100k per unit, since many developers will have projected cashflow on the basis of these sales which will have been used to fund (via bank lending) further projects.
I do genuinely have sympathy for the position that the forumers who've purchased units in James Clow / Titantic / Obel etc find themselves in but I agree with the view expressed in the other similar thread that its time for you guys to stop the theorising and start talking to the developer as its only postponing the inevitable and is in no-ones' interest (yours or the developers) in the long-run.
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Yes - I'm talking about Allied Irish Bank and its subsidiaries.
Note, however, that Anglo Irish Bank also has sterling accounts in the UK. These funds are covered by the Irish Government's guarantee. Its a matter of significant debate as to whether the FSA has a responsibility to provide compensation to Anglo-Irish UK depositors if the Irish Government's guarantee were to fail.
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Are AIB stuffed now?
I notice that they are quite high on the interest rate tables for savings on numerous search facilities - MSE, TIM etc.
Are these genuine rates or is it a sinking ship trying a last minute desparate attempt to get in some capital to keep itself afloat?
* I know it is not backed by FSA, but instead by the Irish Gov. - will they be able to payout to the depositors in the event of a failure. Nationalisation seems morely likely, correct?
I am looking at transferring some money but after getting my fingers burnt previously, I'm being extra careful this time!!!
I'm not sure if you are looking to transfer € or £, but if its the later, and you are thinking of transferring funds to either First Trust (AIB's Northern Ireland subsidiary) or AIB GB (primarily business banking-oriented), then these funds will be covered by the FSA's £50,000 protection level.
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was talking to an old school mate new years eve
he was home for the holidays from a business he runs in vietnam
now he might have been slighlty under the weather or indeed both of us
but i could have swore that he said that inflation there currently 22%
interest 17%
now i know some here take an interest in that part of the world
are these figure correct or just what is the story?
I'm not sure about Vietnamese interest rates.
However, in the Philippines, the lowest mortgage rates available are around 12%. However, its difficult to qualify for a mortgage here (in part, a legacy of the Philippine banks getting very badly burned in the aftermath of the 1997 Asian crisis .... and their lending policies remain conservative over a decade later), with the result that many buyers resort to obtaining "in-house" financing that is offered by the larger property development companies. Rates for in-house financing can be as high as 18%-20%.
Vietnam has had a very significant property boom, not dissimilar to Miami and Dubai etc, which was based on people "flipping" under construction properties for large profits but the market has now entered a period of downturn. Strangely, Cambodia has also undergone a speculative property boom with certain land sites increasingly in value (on paper) by 1,000% - 2,000% over recent years !!!
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The fact that the development was sold to us over a year off plan ment that we could not have even gotten a mortgage in principle. It's a joke.
I sympathise with your situation. However, if this was such a joke, why did you go ahead and enter the contract? Surely you were aware, at the time, that financing was not guaranteed (not to mention the other risks of purchasing off-plan property).
Just so that you know, its perfectly normal for high-rise developments to be sold off-plan well before completion .... in fact, its not abnormal for units in such properties to be sold atleast four years prior to the intended completion date. Its often an integral aspect for ensuring the developer has adequate cashflow (and backing from their financiers) for completing such projects.
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If, as I hope, the developer is receptive to the horrendous economic conditions that we now face in terms of attempting to raise finance to complete and enters a process of renegotiation then I would probably still be happy to pay an agreed price and go into a % of negative equity, as a gesture to the developer of my desire to reach a decent compromise as well as my faith in the development as a whole.
The sentiment is (genuinely) admirable. However, I cannot see any bank providing mortgage financing for a purchase that is already in a negative equity position at time of completion, esp. in today's environment.
Phillipines Blue Coral Resort And Spa
in Overseas property investment
Posted
Its a pity that you feel the need to resort to crude and inaccurate racial stereotypes.
http://www.gov.ph/news/?i=23578