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Indonesia - City Property Prices X10 Higher In As Many Years

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Just seen a feature on Al Jazeera TV -- prices are rising 40 or 50% a year in the cities of Indonesia, in some areas, it seems.

And as you can guess -- these rises are obviously way, way above wages.

Which banks are exposed to this?

I can't find a link at present

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This won't help.....

Jakarta faces property price hike as expats allowed to buy homes

A change in property laws for foreigners in the Indonesian capital of Jakarta could see prices rocket.

Strong demand for rental property from expats has seen costs shoot up almost 15 per cent this year as expats head to Indonesia, which is enjoying a period of strong economic growth.

Business is booming for landlords with high-end apartments near the city centre, where expats prefer to live. It is estimated that about 45,000 foreign workers live in this type of accommodation near Jakarta’s business districts.

But this strong demand for rental properties could quickly shift to buying once the government allows foreigners to purchase property in their own name. The Indonesian government said it wants to open the property market to foreigners while still restricting purchases of land.

It has devised regulation that gives foreigners the right to apply for the purchase of a Building Ownership Certificate (SKBG) that would be separate from land rights.

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It's in emerging markets such as this that QE's unintended consequences are being most keenly felt. By holding down their currencies to keep their exports competitive against the Bernanke dollar these countries have encouraged massive capital in-flows which in turn have sent local property prices parabolic. It's a repeat of the '98 Asian crisis but on an unimaginably vaster scale.

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It's in emerging markets such as this that QE's unintended consequences are being most keenly felt. By holding down their currencies to keep their exports competitive against the Bernanke dollar these countries have encouraged massive capital in-flows which in turn have sent local property prices parabolic. It's a repeat of the '98 Asian crisis but on an unimaginably vaster scale.

That's a relief because that hardly caused a 5h1tstorm at all....

Where's LTCM when you need them!

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That's a relief because that hardly caused a 5h1tstorm at all....

Where's LTCM when you need them!

There are 200 LTCMs in Mayfair alone these days!

The European Development Bank (EBRD) issued a sharp downgrade to emerging North African and Eastern European economic prospects today.

http://www.guardian.co.uk/business/feedarticle/10786555

By Carolyn CohnISTANBUL (Reuters)

Reuters, Friday May 10 2013

Europe's development bank slashed its 2013 growth forecasts for emerging Europe and North Africa on Friday by almost a full percentage point, saying a sharp slowdown in Russia would drag down the regional economy.

The European Bank for Reconstruction and Development (EBRD) said Russia's problems should galvanise the region to pull down barriers to new businesses and investment.But the bank, originally set up to help Europe's ex-communist states, said manufacturing heavyweights Poland and Turkey were also undershooting its expectations.

"We have a slowdown compared with what we thought just a quarter ago," EBRD Chief Economist Erik Berglof told a news conference on the sidelines of the Bank's annual meeting."It's really a story of three big countries - Russia, Poland and Turkey. Turkey was overheating ... Its credit-fuelled boom has ended and we see a soft landing."

The EBRD cut its 2013 average growth forecast for all the countries in which it now operates, including some in North Africa, to 2.2 percent, down from last year's 2.6 percent and an earlier forecast of 3.1 percent.

"Operating conditions are likely to remain demanding," Suma Chakrabarti, president of the EBRD, told the annual meeting.

The troubles of the euro zone have long weighed on the EBRD's region. Host country Turkey has successfully tapped into export markets beyond Europe and the struggling Balkan economy of Serbia said on Friday it was now looking to the United Arab Emirates as well as Russia for investment.

The EBRD said what had seemed like a temporary weakening in Russia was in fact a trend slowdown, fuelled by a fall in global prices for its commodity exports and by lower post-election social spending.This was a "wake-up call across the region to re-energise structural reforms that have been on hold since the start of the crisis," said EBRD Chief Economist Erik Berglof. It now expects Russia's economy to grow just 1.8 percent in 2013 - barely half the 3.5 percent it had forecast in January and last year's 3.4 percent. Growth could pick up next year, but there was "no quick turnaround in sight."

Poland, the only European Union country to escape recession after the 2008 global crisis, will grow 1.2 percent this year, slowing from last year's 1.9 percent. The broader central European region is expected to grow just 0.8 percent, the EBRD said, trimming its January forecast of 1.2 percent.Slovenia, Hungary and Croatia are seen stuck in recession, with Slovenia's economy contracting 2.5 percent as it tries to resolve its banks' bad debts without seeking international aid.

Berglof said Slovenia was moving "in the right direction" to clean up its finances, but added: "It's important there's some kind of framework around, whether it's the International Monetary Fund or something more informal," adding that foreign investors "need to have a sense of stability, a sense of predictability."

In the EBRD's new states, Jordan, Morocco, Tunisia and Egypt, termed SEMED (southern and eastern Mediterranean), Berglof said reducing subsidies would be key to cutting large fiscal deficits.

The growth slowdown is also gripping the countries which joined the EBRD after the 2011 Arab Spring overthrow of dictators in Egypt, Libya and Tunisia.The bank predicts these economies will grow 3 percent in 2013 - on par with 2012 but a full percentage point below January forecasts. It sees Egypt, mired in political turmoil, growing 2 percent - way below the level needed to get more people into work - versus the 3.8 percent previously forecast.Egypt "has exhausted almost all available policy space," it said.

Standard & Poor's cut Egypt's credit rating to C, deep in junk territory, on Thursday.Libya is seeking advice from the EBRD, a source close to the discussions said on Friday, as the country tries to rebuild its institutions after decades of dictatorship.

Edited by zugzwang

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I've been to Jakarta on business, it is worse than Manila, and that is quite an achievement. Airport looks and smells like a 70s working mans club, the city is a concrete monstrosity, hot, sweaty, unwalkable, no subway and perma traffic jams. God knows why anyone would want to live there, you'd need to triple my wage and maybe I'd think about it.

Buying property? Unless you have some sort of coconut milk fetish, dont be silly. The only conceivable reason would be to get in on their growth, but surely there are other ways to get exposure without purchasing a leveraged illiquid asset in a foreign country where you don't speak the language or know the customs or the law.

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  • 243 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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