A local company that delivers video content via the Internet has expanded its offerings to include a classified video advertising service for residential real estate professionals.
Orlando-based Real Estate Channel, a video-on-demand TV network that distributes content online, now allows Realtors or home builders to produce 30-second video profiles of their property listings. Real Estate Channel then inserts the video listings into its network, giving potential home buyers around the world access to viewing them on-demand.
Each video ad also displays the property's information and sales agent or builder contact information with a link to each advertiser's Web site.
The Real Estate Channel is a global video-on-demand television network that delivers real estate video content to viewers on Internet-enabled devices.
Tuesday, September 25, 2007
Luxury condos also face slump
The credit crunch, slowdown in appreciation and rising defaults that have plagued the single-family home sector in Las Vegas are looming as problems in the luxury condominium market, analysts said.
The high-rise and mid-rise condo markets continue to weaken as demand has softened and supply continues to increase - a problem that will worsen as more and more projects come on line in the next year, analysts said. Given the current pace of sales in the resale market, several years of inventory remain.
Those who already closed on their condos with the intention of flipping them aren't finding the buyers they expected. The rental pool for the high-end units is shallow, and the rent owners can charge is limited.
That could lead to defaults in the high-rise market.
Las Vegas is also facing problems that are emerging in other markets and are a byproduct of the speculative boom of 2004 and 2005. Buyers who signed contracts two to three years ago may not be able to close when those projects are completed. In some cases, they may not be able to get financing from lenders and in other cases buyers may walk away, given the market slowdown and higher interest rates they may have to pay.
"We are hearing the potential that some of the units aren't going to close," said John Restrepo, principal of Restrepo Consulting Group that tracks the condominium market. "Some people are walking away because of the credit markets or because what they agreed to pay is not what they thought it would be worth today."
In some cases, buyers put down 10 percent or more and will lose their deposit if they walk away, Restrepo said. In other cases, lenders are turning them down and depending how their contract was written, they may lose their deposits or a portion of it.
"I think the high rises are in for a difficult time due to the mortgage crisis," said local housing analyst Dennis Smith.
Las Vegas is in a good position long term given its growth and its status as America's playground, but it is facing short-term challenges because the condo market was overbuilt and the credit crunch has made the market's prospects worse, said Hessam Nadji, managing director of research of Marcus & Millichap Real Estate Investment Services.
Concerns about foreclosures can't be ignored, but he said investors and second homebuyers in the Las Vegas condo market are in stronger financial positions than in other markets.
But he said that doesn't mean there won't be problems.
Condo developers will be getting some of those units back and if they don't have deep-enough pockets to be patient, will have to discount the units or rent them out, Nadji said.
In other cases, they may help buyers buy down interest rates in order to close the sale, he said.
There are 5,849 luxury condominium units in Las Vegas and another 14,149 units under construction, according to Applied Analysis, a local research firm.
By the end of the second quarter, 718 resale luxury units were on the market, which was down from the first quarter, Applied Analysis reported. Some 37 percent were high rise, 21 percent were mid-rise and 42 percent were condo-hotels.
"I think a lot of folks bought intending to sell. They never thought to live in it or buy it to rent," Restrepo said.
"I hear from condo owners every single day. They bought it to flip it and they can't sell it," added Eric Smith, owner of Colorado-based Corporate Housing By Owner, which works with condo owners who lease their units for short-term corporate housing.
Smith said more condo owners would be able to withstand the oversupply but their associations require a minimum of three-month leases or longer or the associations limit leases to one per year, restrictions that hamper owners' ability to lease their units for shorter terms.
The problems affecting existing and under-construction condo units also apply to condos that have yet to be built.
Some 6,091 condo units are being marketed but construction has yet to begin. Some 19,100 have been canceled or had their sales suspended and more than 58,000 units remain on the table for construction, Applied Analysis reported.
Slowing demand and escalating construction costs are expected to put a further damper on new luxury condominium projects unless they are mixed-use ones built by the resort industry.
At MGM Mirage's Project CityCenter, for example, 1,200 of the 2,400 condominium and condo hotel units are under contract since sales started earlier this year, and MGM Mirage Chairman Terry Lanni said recently that Dubai World's pending partnership will help the company sell even more units, at even higher prices.
Steve Bottfeld, executive vice president of Marketing Solutions, said the condo market has been affected by a climate of fear that has kept people on the sidelines, he said.
"The high-rise market is undergoing a significant sales problem right now and, more important, a resales problem," Bottfeld said.
The condo-hotel market, which Applied Analysis said represents nearly 46 percent of the market under construction or being marketed, is under pressure, analysts said.
Many owners of condo-hotel units at the Residences at MGM Grand and Platinum don't have positive cash flow, and that has deterred interest in that market, Bottfeld said. And when prices of some condo hotels are running $1,500 a square foot, that softens demand, he said.
Buyers of condos who bought in the early stages in 2003 and 2004 are $150,000 to $200,000 ahead, but those who bought in 2005 and 2006 find themselves in a difficult position, he said. With a median household income of $53,000, there are only so many people who can pay $2,000 to $3,000 a month in rent to help cover the mortgage.
Bruce Hiatt, co-owner/broker of Luxury Realty Group, said he expected a window of about 12 months in which there would be an oversupply of condos, calling it the "perfect storm."
With that in mind, Hiatt has launched a program geared toward sellers who are going into foreclosure or can't carry their mortgage and buyers who may have to walk away from their deposits because they can't close.
Hiatt said 2008 will be a tough year with the future south Strip and downtown faring worse than the resort corridor, but he said buyers who are patient and can wait three to five years are in good shape.
Given the rising land and construction costs, developers can't build condos for less than $1,800 a square foot, Hiatt said. There are many people who bought between $400 and $900 a square foot and stand to benefit.
Although Las Vegas's condo market growth is limited by the lack of water views, it remains attractive over the long term as a second-home market, Restrepo said. But it won't match what was seen during the boom when investors helped drive the market, he said.
"I think the depth of the high-rise market has been overstated," Restrepo said. "I think what you are going to see over the next couple of years is that the wave of excitement and irrational exuberance is over. There will be more realistic demand."
Among the findings reported by Restrepo Consulting:
• Existing and under-construction, high-rise condos have a median price-per-square-foot of nearly $599, compared to a median price per square foot of $443 for existing and under construction mid-rise projects reported by Hanley Wood Market Intelligence.
• In the second quarter, there were 2,689 existing and 5,805 under-construction and actively selling condo-hotel units in the resort corridor. Those units had a median price-per-square-foot of $1,038.
• As of June 30 on the resale market, there were 227 luxury high-rise units, excluding condo-hotels, with a median price-per-square-foot of $499. In addition there were 221 condo hotel units with a median price of $832 per square foot. On the average, luxury high-rise condos stayed on the market for 114 days while condo-hotel units stayed on the market for 125 days.
• About 20 percent of the existing, actively selling and canceled projects are located in suburban areas where there is increased interest for development because of high development costs along the Strip.
• Of the 227 resale units on the market, 56 units were at the fourth tower at Turnberry Place (24 percent of its inventory); 33 were at the first tower at Panorama Towers (10 percent of its inventory).
• Of the 221 condo-hotel units on the resale market, 168 were at The Residences at MGM Grand, which is nearly 15 percent of that project's inventory and 53 were at Platinum Resort, which accounts for nearly 21 percent of its inventory.
• Overall, four high-rise projects, Panorama Tower I, Platinum, Turnberry Place Tower 4 and The Residences at MGM Grand accounted for 69 percent of all high-rise resales.
Among findings of Applied Analysis:
• Those units listed on the Multiple Listing Service during the second quarter had an average asking price of $830,4000 or $624 per square foot.
• During the second quarter, units that sold averaged $814,000 or $507 per square foot. High-rise, non-condo hotel averaged $545 per square foot; mid-rise residence averaged $287 per square foot.
The high-rise and mid-rise condo markets continue to weaken as demand has softened and supply continues to increase - a problem that will worsen as more and more projects come on line in the next year, analysts said. Given the current pace of sales in the resale market, several years of inventory remain.
Those who already closed on their condos with the intention of flipping them aren't finding the buyers they expected. The rental pool for the high-end units is shallow, and the rent owners can charge is limited.
That could lead to defaults in the high-rise market.
Las Vegas is also facing problems that are emerging in other markets and are a byproduct of the speculative boom of 2004 and 2005. Buyers who signed contracts two to three years ago may not be able to close when those projects are completed. In some cases, they may not be able to get financing from lenders and in other cases buyers may walk away, given the market slowdown and higher interest rates they may have to pay.
"We are hearing the potential that some of the units aren't going to close," said John Restrepo, principal of Restrepo Consulting Group that tracks the condominium market. "Some people are walking away because of the credit markets or because what they agreed to pay is not what they thought it would be worth today."
In some cases, buyers put down 10 percent or more and will lose their deposit if they walk away, Restrepo said. In other cases, lenders are turning them down and depending how their contract was written, they may lose their deposits or a portion of it.
"I think the high rises are in for a difficult time due to the mortgage crisis," said local housing analyst Dennis Smith.
Las Vegas is in a good position long term given its growth and its status as America's playground, but it is facing short-term challenges because the condo market was overbuilt and the credit crunch has made the market's prospects worse, said Hessam Nadji, managing director of research of Marcus & Millichap Real Estate Investment Services.
Concerns about foreclosures can't be ignored, but he said investors and second homebuyers in the Las Vegas condo market are in stronger financial positions than in other markets.
But he said that doesn't mean there won't be problems.
Condo developers will be getting some of those units back and if they don't have deep-enough pockets to be patient, will have to discount the units or rent them out, Nadji said.
In other cases, they may help buyers buy down interest rates in order to close the sale, he said.
There are 5,849 luxury condominium units in Las Vegas and another 14,149 units under construction, according to Applied Analysis, a local research firm.
By the end of the second quarter, 718 resale luxury units were on the market, which was down from the first quarter, Applied Analysis reported. Some 37 percent were high rise, 21 percent were mid-rise and 42 percent were condo-hotels.
"I think a lot of folks bought intending to sell. They never thought to live in it or buy it to rent," Restrepo said.
"I hear from condo owners every single day. They bought it to flip it and they can't sell it," added Eric Smith, owner of Colorado-based Corporate Housing By Owner, which works with condo owners who lease their units for short-term corporate housing.
Smith said more condo owners would be able to withstand the oversupply but their associations require a minimum of three-month leases or longer or the associations limit leases to one per year, restrictions that hamper owners' ability to lease their units for shorter terms.
The problems affecting existing and under-construction condo units also apply to condos that have yet to be built.
Some 6,091 condo units are being marketed but construction has yet to begin. Some 19,100 have been canceled or had their sales suspended and more than 58,000 units remain on the table for construction, Applied Analysis reported.
Slowing demand and escalating construction costs are expected to put a further damper on new luxury condominium projects unless they are mixed-use ones built by the resort industry.
At MGM Mirage's Project CityCenter, for example, 1,200 of the 2,400 condominium and condo hotel units are under contract since sales started earlier this year, and MGM Mirage Chairman Terry Lanni said recently that Dubai World's pending partnership will help the company sell even more units, at even higher prices.
Steve Bottfeld, executive vice president of Marketing Solutions, said the condo market has been affected by a climate of fear that has kept people on the sidelines, he said.
"The high-rise market is undergoing a significant sales problem right now and, more important, a resales problem," Bottfeld said.
The condo-hotel market, which Applied Analysis said represents nearly 46 percent of the market under construction or being marketed, is under pressure, analysts said.
Many owners of condo-hotel units at the Residences at MGM Grand and Platinum don't have positive cash flow, and that has deterred interest in that market, Bottfeld said. And when prices of some condo hotels are running $1,500 a square foot, that softens demand, he said.
Buyers of condos who bought in the early stages in 2003 and 2004 are $150,000 to $200,000 ahead, but those who bought in 2005 and 2006 find themselves in a difficult position, he said. With a median household income of $53,000, there are only so many people who can pay $2,000 to $3,000 a month in rent to help cover the mortgage.
Bruce Hiatt, co-owner/broker of Luxury Realty Group, said he expected a window of about 12 months in which there would be an oversupply of condos, calling it the "perfect storm."
With that in mind, Hiatt has launched a program geared toward sellers who are going into foreclosure or can't carry their mortgage and buyers who may have to walk away from their deposits because they can't close.
Hiatt said 2008 will be a tough year with the future south Strip and downtown faring worse than the resort corridor, but he said buyers who are patient and can wait three to five years are in good shape.
Given the rising land and construction costs, developers can't build condos for less than $1,800 a square foot, Hiatt said. There are many people who bought between $400 and $900 a square foot and stand to benefit.
Although Las Vegas's condo market growth is limited by the lack of water views, it remains attractive over the long term as a second-home market, Restrepo said. But it won't match what was seen during the boom when investors helped drive the market, he said.
"I think the depth of the high-rise market has been overstated," Restrepo said. "I think what you are going to see over the next couple of years is that the wave of excitement and irrational exuberance is over. There will be more realistic demand."
Among the findings reported by Restrepo Consulting:
• Existing and under-construction, high-rise condos have a median price-per-square-foot of nearly $599, compared to a median price per square foot of $443 for existing and under construction mid-rise projects reported by Hanley Wood Market Intelligence.
• In the second quarter, there were 2,689 existing and 5,805 under-construction and actively selling condo-hotel units in the resort corridor. Those units had a median price-per-square-foot of $1,038.
• As of June 30 on the resale market, there were 227 luxury high-rise units, excluding condo-hotels, with a median price-per-square-foot of $499. In addition there were 221 condo hotel units with a median price of $832 per square foot. On the average, luxury high-rise condos stayed on the market for 114 days while condo-hotel units stayed on the market for 125 days.
• About 20 percent of the existing, actively selling and canceled projects are located in suburban areas where there is increased interest for development because of high development costs along the Strip.
• Of the 227 resale units on the market, 56 units were at the fourth tower at Turnberry Place (24 percent of its inventory); 33 were at the first tower at Panorama Towers (10 percent of its inventory).
• Of the 221 condo-hotel units on the resale market, 168 were at The Residences at MGM Grand, which is nearly 15 percent of that project's inventory and 53 were at Platinum Resort, which accounts for nearly 21 percent of its inventory.
• Overall, four high-rise projects, Panorama Tower I, Platinum, Turnberry Place Tower 4 and The Residences at MGM Grand accounted for 69 percent of all high-rise resales.
Among findings of Applied Analysis:
• Those units listed on the Multiple Listing Service during the second quarter had an average asking price of $830,4000 or $624 per square foot.
• During the second quarter, units that sold averaged $814,000 or $507 per square foot. High-rise, non-condo hotel averaged $545 per square foot; mid-rise residence averaged $287 per square foot.
BridgeStreet Worldwide Announces New Global Alliance Partner
Newest premier partner expands opportunities in Charlotte market
BridgeStreet Worldwide, a leading international provider of corporate housing to business travelers, announced the signing of its latest Premier Global Alliance Partner, A+ Accommodations & Relocation, Inc., headquartered in Charlotte, NC.
The BridgeStreet Global Alliance is a network of corporate housing providers dedicated to high quality accommodations and services working collaboratively throughout the world. The program is respected among the industry for attracting top local and regional providers of corporate housing who share BridgeStreet’s deep commitment to exceed client and guest expectations and to make the corporate housing experience easy. The Premier Partners exemplify the highest operating standards and undergo the most stringent due diligence process in the industry.
“We welcome A+ Accommodations to the BridgeStreet Global Alliance,” said Lee Curtis, president and CEO of BridgeStreet Worldwide. “Charlotte is a fast growing east coast city with an increasing number of corporate relocations that require high quality temporary housing services. We are very excited to have such an outstanding partner in Charlotte and we are confident that our guests will receive the same superior service that they have grown to expect from BridgeStreet.”
In conjunction with adding A+ Accommodations to the BridgeStreet Global Alliance, BridgeStreet Worldwide and A+ Accommodations have merged operations and will continue to operate under the A+ Accommodations name. “For our customers, this translates to a seamless guest experience exhibited through standardized services, accommodations and account management across the entire Global Alliance,” stated Curtis.
A+ Accommodations & Relocation brings their decade of experience and a rock solid reputation in the Charlotte, North Carolina market to the BridgeStreet Global Alliance. “Joining the BridgeStreet Global Alliance is in direct alignment with our company’s commitment to customer service excellence,” said Clifford Thomas, President of A+ Accommodations. “BridgeStreet is a highly recognized and well-respected industry leader globally and this partnership will open up a world of opportunities for A+ Accommodations in providing our clients with access to a vast network of quality temporary housing options worldwide.” BridgeStreet Worldwide is a leading international provider of corporate housing. BridgeStreet and its Global Partner Alliance offer over 15,000 corporate apartments located throughout the United States and 50 cities internationally. An award winner both in the U.S. and Europe, BridgeStreet properties meet uncompromising standards of quality, comfort and service. For more information about the company or to learn more about how BridgeStreet is Making Corporate Housing Easy, visit www.bridgestreet.com or call 1-800-BSTREET.
Founded in 1997 and headquartered in Charlotte, NC, A+ Accommodations & Relocation, Inc. is a leading provider of fully-furnished apartment homes serving the North and South Carolina markets. A+ Accommodations works with over 300 properties in Charlotte and surrounding markets throughout the Carolinas and assists many large corporate clients, relocation companies, real estate firms, consulting firms and others seeking accommodations for 30 days or more. For more information please visit the Company’s Web site.
BridgeStreet Worldwide, a leading international provider of corporate housing to business travelers, announced the signing of its latest Premier Global Alliance Partner, A+ Accommodations & Relocation, Inc., headquartered in Charlotte, NC.
The BridgeStreet Global Alliance is a network of corporate housing providers dedicated to high quality accommodations and services working collaboratively throughout the world. The program is respected among the industry for attracting top local and regional providers of corporate housing who share BridgeStreet’s deep commitment to exceed client and guest expectations and to make the corporate housing experience easy. The Premier Partners exemplify the highest operating standards and undergo the most stringent due diligence process in the industry.
“We welcome A+ Accommodations to the BridgeStreet Global Alliance,” said Lee Curtis, president and CEO of BridgeStreet Worldwide. “Charlotte is a fast growing east coast city with an increasing number of corporate relocations that require high quality temporary housing services. We are very excited to have such an outstanding partner in Charlotte and we are confident that our guests will receive the same superior service that they have grown to expect from BridgeStreet.”
In conjunction with adding A+ Accommodations to the BridgeStreet Global Alliance, BridgeStreet Worldwide and A+ Accommodations have merged operations and will continue to operate under the A+ Accommodations name. “For our customers, this translates to a seamless guest experience exhibited through standardized services, accommodations and account management across the entire Global Alliance,” stated Curtis.
A+ Accommodations & Relocation brings their decade of experience and a rock solid reputation in the Charlotte, North Carolina market to the BridgeStreet Global Alliance. “Joining the BridgeStreet Global Alliance is in direct alignment with our company’s commitment to customer service excellence,” said Clifford Thomas, President of A+ Accommodations. “BridgeStreet is a highly recognized and well-respected industry leader globally and this partnership will open up a world of opportunities for A+ Accommodations in providing our clients with access to a vast network of quality temporary housing options worldwide.” BridgeStreet Worldwide is a leading international provider of corporate housing. BridgeStreet and its Global Partner Alliance offer over 15,000 corporate apartments located throughout the United States and 50 cities internationally. An award winner both in the U.S. and Europe, BridgeStreet properties meet uncompromising standards of quality, comfort and service. For more information about the company or to learn more about how BridgeStreet is Making Corporate Housing Easy, visit www.bridgestreet.com or call 1-800-BSTREET.
Founded in 1997 and headquartered in Charlotte, NC, A+ Accommodations & Relocation, Inc. is a leading provider of fully-furnished apartment homes serving the North and South Carolina markets. A+ Accommodations works with over 300 properties in Charlotte and surrounding markets throughout the Carolinas and assists many large corporate clients, relocation companies, real estate firms, consulting firms and others seeking accommodations for 30 days or more. For more information please visit the Company’s Web site.
Wednesday, September 19, 2007
Economist warns of US housing downturn
There will be fresh economic shocks on the scale of the current credit squeeze if US house prices continue to fall, one of the country’s leading housing experts warned on Wednesday.
“The decline in house prices stands to create future dislocations, like the credit crisis we have just seen,” Robert Shiller, a Yale economist, told a Senate panel on Wednesday.
There were fresh signs of weakness ahead for the housing sector as figures showed applications for building permits fell to a 12-year-low.
Housing starts dropped to the lowest level since June 1995, declining 2.6 per cent to an annual rate of 1.331m units.
The decline in construction activity also appeared to be spreading to the north-east, where starts were 38 per cent lower.
Patrick Newport, an economist at Global Insight, said: ”The eye of the storm is just ahead.”
Consumer prices fell last month by 0.1 per cent as prices at the pump dropped by nearly 5 per cent.
Core prices - excluding volatile food and energy costs - increased by 0.2 per cent, but the annual underlying inflation rate edged down to a 17-month low of 2.1 per cent from 2.2 per cent.
”Overall, the figures support the idea that inflation is much less of a concern than it was six months ago,” said Paul Ashworth, an economist at Capital Economics.
”The Fed is lucky that inflation is beginning to behave itself again, because the housing market is in desperate need of some monetary stimulus,” he added.
Mr Shiller told the Senate panel on Wednesday that while there had been a focus “on lax and irresponsible lending standards, I believe that this loss in housing value is the major ultimate reason we see a crisis today.”
The economist said he feared “the collapse of home prices might turn out to be the most severe since the Great Depression.”
Alan Greenspan, former Federal Reserve chairman, told the Financial Times this week that double digit falls in house prices from their peaks would not be surprising.
A national fall in house prices on that scale would be unprecedented in US history and would have an economic cost several times greater than the meltdown in the subprime mortgage market that triggered the current financial crisis.
The Center for Responsible Lending has predicted that foreclosures on subprime loans will lead to a cumulative loss of $164bn in home equity. Investment banks have suggested the costs to investors and financial institutions could be more than $300bn.
The Senate on Wednesday heard from experts who said a 15 per cent fall in house prices would wipe out $3,000bn of household wealth.
Alex Pollock, a fellow at the conservative American Enterprise Institute, said: “Residential real estate is a huge asset class, with an aggregate value of about $21,000bn, and is of course the single largest component of the wealth of most households.”
“A year ago, it was common to say that while house prices would periodically fall on a regional basis, they could not on a national basis....Well, now house prices are falling on a national basis,” he said
Mr Shiller said it was “difficult to predict the depth, duration and all of the consequences” of the worsening housing slump.
“The Federal Reserve will undoubtedly take aggressive actions, which will mitigate its severity. But, if home price deflation persists or intensifies, they may discover that the Achille’s Heel of this resilient economy is the evaporation of confidence that can accompany the end-of-boom psychology,” he said.
Senator Charles Schumer, chairman of the joint economic committee, criticised the handling of the subprime crisis by the Fed and the Bush administration.
“In March, Chairman [Ben] Bernanke came before this committee and told us that the problems in the subprime market would have little or no impact on the overall economy,” he said
“Despite all the reassuring statements we’ve heard from the administration that the impact of this mess would be ‘contained’, it has not been contained, but has been a contagion that has spread to all sectors of the economy,” he added.
Peter Orszag, director of the non-partisan congressional budget bffice, told the Senate panel that the “turbulence in housing markets could affect the broader macroeconomy through ”various channels” and that the current outlook was ”particularly uncertain”.
He said the main channels were “reduced investment in housing; a reduction in consumer spending because household wealth declines; contagion in financial markets ...and a lessening of consumers’ and businesses’ confidence about the future”.
“The potential effects involving contagion and confidence are especially difficult to evaluate because they depend in part on how financial market participants, consumers, and business executives perceive the situation,” he added.
But he noted that most private sector economists were still predicting economic growth next year.
“The decline in house prices stands to create future dislocations, like the credit crisis we have just seen,” Robert Shiller, a Yale economist, told a Senate panel on Wednesday.
There were fresh signs of weakness ahead for the housing sector as figures showed applications for building permits fell to a 12-year-low.
Housing starts dropped to the lowest level since June 1995, declining 2.6 per cent to an annual rate of 1.331m units.
The decline in construction activity also appeared to be spreading to the north-east, where starts were 38 per cent lower.
Patrick Newport, an economist at Global Insight, said: ”The eye of the storm is just ahead.”
Consumer prices fell last month by 0.1 per cent as prices at the pump dropped by nearly 5 per cent.
Core prices - excluding volatile food and energy costs - increased by 0.2 per cent, but the annual underlying inflation rate edged down to a 17-month low of 2.1 per cent from 2.2 per cent.
”Overall, the figures support the idea that inflation is much less of a concern than it was six months ago,” said Paul Ashworth, an economist at Capital Economics.
”The Fed is lucky that inflation is beginning to behave itself again, because the housing market is in desperate need of some monetary stimulus,” he added.
Mr Shiller told the Senate panel on Wednesday that while there had been a focus “on lax and irresponsible lending standards, I believe that this loss in housing value is the major ultimate reason we see a crisis today.”
The economist said he feared “the collapse of home prices might turn out to be the most severe since the Great Depression.”
Alan Greenspan, former Federal Reserve chairman, told the Financial Times this week that double digit falls in house prices from their peaks would not be surprising.
A national fall in house prices on that scale would be unprecedented in US history and would have an economic cost several times greater than the meltdown in the subprime mortgage market that triggered the current financial crisis.
The Center for Responsible Lending has predicted that foreclosures on subprime loans will lead to a cumulative loss of $164bn in home equity. Investment banks have suggested the costs to investors and financial institutions could be more than $300bn.
The Senate on Wednesday heard from experts who said a 15 per cent fall in house prices would wipe out $3,000bn of household wealth.
Alex Pollock, a fellow at the conservative American Enterprise Institute, said: “Residential real estate is a huge asset class, with an aggregate value of about $21,000bn, and is of course the single largest component of the wealth of most households.”
“A year ago, it was common to say that while house prices would periodically fall on a regional basis, they could not on a national basis....Well, now house prices are falling on a national basis,” he said
Mr Shiller said it was “difficult to predict the depth, duration and all of the consequences” of the worsening housing slump.
“The Federal Reserve will undoubtedly take aggressive actions, which will mitigate its severity. But, if home price deflation persists or intensifies, they may discover that the Achille’s Heel of this resilient economy is the evaporation of confidence that can accompany the end-of-boom psychology,” he said.
Senator Charles Schumer, chairman of the joint economic committee, criticised the handling of the subprime crisis by the Fed and the Bush administration.
“In March, Chairman [Ben] Bernanke came before this committee and told us that the problems in the subprime market would have little or no impact on the overall economy,” he said
“Despite all the reassuring statements we’ve heard from the administration that the impact of this mess would be ‘contained’, it has not been contained, but has been a contagion that has spread to all sectors of the economy,” he added.
Peter Orszag, director of the non-partisan congressional budget bffice, told the Senate panel that the “turbulence in housing markets could affect the broader macroeconomy through ”various channels” and that the current outlook was ”particularly uncertain”.
He said the main channels were “reduced investment in housing; a reduction in consumer spending because household wealth declines; contagion in financial markets ...and a lessening of consumers’ and businesses’ confidence about the future”.
“The potential effects involving contagion and confidence are especially difficult to evaluate because they depend in part on how financial market participants, consumers, and business executives perceive the situation,” he added.
But he noted that most private sector economists were still predicting economic growth next year.
ApartmenTime.com Is Working to Create the Nationwide Emergency Housing Network.
ApartmenTime.com, America's fastest-growing online apartment listing service, is working to create the first of its kind nationwide Emergency Housing Network.
NEW YORK (January 19, 2006) - ApartmenTime.com, America?s fastest-growing online apartment listing service, is working to create the first of its kind nationwide Emergency Housing Network.With recent events such as Hurricanes Katrina and Rita showing the country how unprepared it is for natural disasters, it?s critically important to create a nationwide system that gives agencies such as FEMA and the Red Cross an updated list of available apartment units from coast to coast.
Now ApartmenTime.com is doing it! ApartmenTime.com is creating a site within its site called the Emergency Housing Network. This site will only be activated in times of national need and will include a list of over 100,000 empty apartment units throughout the country.Here?s how it will work: When a disaster strikes, government officials can assign victims apartments based on their needs from this nationwide list. Property management firms and owners will be ready to expect new occupants, and arraignments will already be in place. This streamlines the process immeasurably.
This will also help keep better track of victims and ensure that everyone in need of housing is being served. ApartmenTime.com expects to have some elements of this Web site ready before the February 28th deadline to help victims of Hurricanes Katrina and Rita; if not, it will be in full operation prior to the start of the next hurricane season on June 1, 2006.The Emergency Housing Network will be a national listing and will be used for all disasters. Hurricanes are not the only natural disasters that require emergency housing response; floods, fires and earthquakes are commonplace on the West Coast, and the EHN will be available to all in need. When a visitor comes to the EHN, they?ll not only be able to locate available affordable housing but, using our Citysearch@ApartmenTime.com feature, they will be able to locate schools, churches, daycare, unemployment offices, job search sites such as Hotjobs and Monster.com, and many other resources they will need in order to fully integrate into their new permanent or temporary community.Creating a site such as this will require a lot of work, and of course funding; ApartmenTime.com is hoping to receive assistance to make it work to the benefit of all Americans.
About ApartmenTime.comAmerica?s newest online apartment listing service, ApartmenTime.com, is a leading, high quality and innovative apartment listing service, specializing in providing advertising solutions for the Multi-Family Housing Industry. ApartmenTime.com is utilizing the Internet to provide this growing market with comprehensive housing listings and the latest community information. Visit our Web site: www.apartmentime.com
For more information:
13719 N. DeFoe Avenue
Sylmar, CA 91342
323-200-2167
Visit our website: http://www.apartmentime.com
NEW YORK (January 19, 2006) - ApartmenTime.com, America?s fastest-growing online apartment listing service, is working to create the first of its kind nationwide Emergency Housing Network.With recent events such as Hurricanes Katrina and Rita showing the country how unprepared it is for natural disasters, it?s critically important to create a nationwide system that gives agencies such as FEMA and the Red Cross an updated list of available apartment units from coast to coast.
Now ApartmenTime.com is doing it! ApartmenTime.com is creating a site within its site called the Emergency Housing Network. This site will only be activated in times of national need and will include a list of over 100,000 empty apartment units throughout the country.Here?s how it will work: When a disaster strikes, government officials can assign victims apartments based on their needs from this nationwide list. Property management firms and owners will be ready to expect new occupants, and arraignments will already be in place. This streamlines the process immeasurably.
This will also help keep better track of victims and ensure that everyone in need of housing is being served. ApartmenTime.com expects to have some elements of this Web site ready before the February 28th deadline to help victims of Hurricanes Katrina and Rita; if not, it will be in full operation prior to the start of the next hurricane season on June 1, 2006.The Emergency Housing Network will be a national listing and will be used for all disasters. Hurricanes are not the only natural disasters that require emergency housing response; floods, fires and earthquakes are commonplace on the West Coast, and the EHN will be available to all in need. When a visitor comes to the EHN, they?ll not only be able to locate available affordable housing but, using our Citysearch@ApartmenTime.com feature, they will be able to locate schools, churches, daycare, unemployment offices, job search sites such as Hotjobs and Monster.com, and many other resources they will need in order to fully integrate into their new permanent or temporary community.Creating a site such as this will require a lot of work, and of course funding; ApartmenTime.com is hoping to receive assistance to make it work to the benefit of all Americans.
About ApartmenTime.comAmerica?s newest online apartment listing service, ApartmenTime.com, is a leading, high quality and innovative apartment listing service, specializing in providing advertising solutions for the Multi-Family Housing Industry. ApartmenTime.com is utilizing the Internet to provide this growing market with comprehensive housing listings and the latest community information. Visit our Web site: www.apartmentime.com
For more information:
13719 N. DeFoe Avenue
Sylmar, CA 91342
323-200-2167
Visit our website: http://www.apartmentime.com
Tchnetwork.com ready to serve in growing corporate housing needs!
The Corporate Housing Network (www.tchnetwork.com) has taken some major steps to get ready for the boom of corporate housing needs all over the World.
United States of America (Press Release) September 13, 2007 -- In your search for corporate housing, are you tired of endlessly calling 800# after 800#, only to be told “Let me look into this and get back to you”? Well, on TCHNetwork.com, you are in the driver’s seat. You can view real-time availability options from among the most respected corporate housing providers – nationally and internationally – for NO cost.
Looking for a 1 bedroom with den in the DC Metro area? A rental home in South Florida? A studio in Denver? A townhouse outside of Manhattan? Perform a quick search, pick and choose from a handful of options, and contact the property owner directly and immediately, right from our site. The good news is that since the upcoming furnished units you see on the site are already (or about to be) vacant, you may be in a position to negotiate a more aggressive rate.
If you don’t see an exact match, click REQUEST corporate housing. When you do, housing providers in that area automatically receive a notification alerting them that TCHNetwork has found a match. Corporate housing owners will get back to you immediately – and compete for your business. The end result? Your rates you receive will be extremely competitive, and corporate housing owners will keep their units full. Everyone wins.Tchnetwork.com is a great place for a corporate rental and has discovered that people working as far away as still want to live in while they work. The typical corporate rental is three to six months and is a great deal for both the unit owner and the renter.
The units all come fully furnished and turn key for immediate move in. The units have linens, new furniture, internet access, and great beach views. The units can be cleaned as often as the renter wants as we have multiple cleaning crews available.
For more information:
Karoly Bozan
The Corporate Housing Network!
info@tchnetwork.com
United States of America (Press Release) September 13, 2007 -- In your search for corporate housing, are you tired of endlessly calling 800# after 800#, only to be told “Let me look into this and get back to you”? Well, on TCHNetwork.com, you are in the driver’s seat. You can view real-time availability options from among the most respected corporate housing providers – nationally and internationally – for NO cost.
Looking for a 1 bedroom with den in the DC Metro area? A rental home in South Florida? A studio in Denver? A townhouse outside of Manhattan? Perform a quick search, pick and choose from a handful of options, and contact the property owner directly and immediately, right from our site. The good news is that since the upcoming furnished units you see on the site are already (or about to be) vacant, you may be in a position to negotiate a more aggressive rate.
If you don’t see an exact match, click REQUEST corporate housing. When you do, housing providers in that area automatically receive a notification alerting them that TCHNetwork has found a match. Corporate housing owners will get back to you immediately – and compete for your business. The end result? Your rates you receive will be extremely competitive, and corporate housing owners will keep their units full. Everyone wins.Tchnetwork.com is a great place for a corporate rental and has discovered that people working as far away as still want to live in while they work. The typical corporate rental is three to six months and is a great deal for both the unit owner and the renter.
The units all come fully furnished and turn key for immediate move in. The units have linens, new furniture, internet access, and great beach views. The units can be cleaned as often as the renter wants as we have multiple cleaning crews available.
For more information:
Karoly Bozan
The Corporate Housing Network!
info@tchnetwork.com
Sunday, September 9, 2007
Dubai apartments for rent on Self-Catering basis
Following my last article Tips for tenants, in this issue I would like to cover some interesting guidelines for those Dubai landlords adventuring into the Short-Term Rental business.
It is a very common and old practice, especially in the Italian, Spanish or French Riviera to rent out a personal property as a holiday-home to tourists. The short-term rental business has proven pretty successful in those countries with strong tourism affluence and since Dubai is working on becoming an international holiday destination, it is interesting to consider this investment opportunity.
By renting out a property on short-term basis a landlord has the chance to use the property for his/her own personal use, generate a high return of investment by letting it out to holidaymakers and at the same time benefit from the property value appreciation.
The short-term rental concept could be applied anywhere in the world but the real key to its success lays in its implementation within the local market in fact any successful business idea can be brought to Dubai and prove a complete disaster, the concept by itself is nothing new and certainly not invented in Dubai so the actual heart of the business is not much in the idea as it is in its execution.
Having the idea and the product (the property) is just about 10% of the business, what really matters is the marketing which I would value at 70% and the actual daily running which could be valued at 20%
Setting up an apartment for the short-term rental requires experience, interior designing skills, attention to details and plenty of time and resources to follow up the actual furnishing process, utilities connections, daily running and marketing.
Some details are extremely important and if overlooked, will compromise the stay of your guests hence it is essential to set up the property with the guests needs in mind rather than following a questionable personal taste.
One detail that is consistently overlooked is the actual efficiency of the bedrooms curtains, which in the majority of the cases do not block the windows light properly, this is usually due to lack of experience or to good bargain ready-made curtains resulting in a horrible 6 am daily wake up call for your guests.
Another important aspect to acknowledge is the considerable investment to be made in purchasing the bathrooms face and body towels, it is in fact necessary to provide a high number of these so to allow a twice weekly replenishment and the same goes for bed sheets, quilt covers, pillow cases etc
In most cases the do it yourself schemes work pretty well when you do have experience, knowledge and passion about what you are engaging with, other wise it will simply result in complete frustration to say the least.
Without considering the daily management issues and the inevitable guests complaints even the twice-weekly house keeping service is a far more demanding task then what it seems
A reasonable solution to this, especially if you are handling more then one property, is to refer the entire marketing and management to a professional agent who for a fee (usually 20% of the rental) will take the weight off your shoulders with a smile.
In the current market a 5 stars marina-view one bedroom apartment in Dubai Marina Face 1 (where all the cafs and restaurants are) will rent for approx AED 95.000/- per year if unfurnished, the same property can fetch up to a AED 235.000/- a year if rented out furnished on short-term basis and after deducting the 20% agency commission plus about AED 40.000/- for the 5 stars furnishing and approx AED 8.000/- a year for the utility bills, this will live the owner with a net AED 142.000/- (on occupancy rate of 79%)
The numbers speak for themselves however is important to remember that where there is a good return there is also a certain risk and many will agree that the most delicate figure of the above calculation is the occupancy rate which cannot be guaranteed in any property short-term rental management contract.
Keeping the above consideration in mind, would you wish to engage an agent for your short-term rental requirements, it would be wise to commit for an initial trial period of maximum six months, this period shall allow you to gather enough details and should give you a good idea about the reliability and actual potential of the agent/marketer you are dealing with.
Would you rather get more hands-on with the business, you could opt for a non-exclusive marketing agreement, also available in the market and you will be able to market your property through other agent/marketers and potentially increase your exposure however this is not necessarily the optimum solution in fact many agents will give priority to the properties of those clients with whom they have contractually committed with.
It is a very common and old practice, especially in the Italian, Spanish or French Riviera to rent out a personal property as a holiday-home to tourists. The short-term rental business has proven pretty successful in those countries with strong tourism affluence and since Dubai is working on becoming an international holiday destination, it is interesting to consider this investment opportunity.
By renting out a property on short-term basis a landlord has the chance to use the property for his/her own personal use, generate a high return of investment by letting it out to holidaymakers and at the same time benefit from the property value appreciation.
The short-term rental concept could be applied anywhere in the world but the real key to its success lays in its implementation within the local market in fact any successful business idea can be brought to Dubai and prove a complete disaster, the concept by itself is nothing new and certainly not invented in Dubai so the actual heart of the business is not much in the idea as it is in its execution.
Having the idea and the product (the property) is just about 10% of the business, what really matters is the marketing which I would value at 70% and the actual daily running which could be valued at 20%
Setting up an apartment for the short-term rental requires experience, interior designing skills, attention to details and plenty of time and resources to follow up the actual furnishing process, utilities connections, daily running and marketing.
Some details are extremely important and if overlooked, will compromise the stay of your guests hence it is essential to set up the property with the guests needs in mind rather than following a questionable personal taste.
One detail that is consistently overlooked is the actual efficiency of the bedrooms curtains, which in the majority of the cases do not block the windows light properly, this is usually due to lack of experience or to good bargain ready-made curtains resulting in a horrible 6 am daily wake up call for your guests.
Another important aspect to acknowledge is the considerable investment to be made in purchasing the bathrooms face and body towels, it is in fact necessary to provide a high number of these so to allow a twice weekly replenishment and the same goes for bed sheets, quilt covers, pillow cases etc
In most cases the do it yourself schemes work pretty well when you do have experience, knowledge and passion about what you are engaging with, other wise it will simply result in complete frustration to say the least.
Without considering the daily management issues and the inevitable guests complaints even the twice-weekly house keeping service is a far more demanding task then what it seems
A reasonable solution to this, especially if you are handling more then one property, is to refer the entire marketing and management to a professional agent who for a fee (usually 20% of the rental) will take the weight off your shoulders with a smile.
In the current market a 5 stars marina-view one bedroom apartment in Dubai Marina Face 1 (where all the cafs and restaurants are) will rent for approx AED 95.000/- per year if unfurnished, the same property can fetch up to a AED 235.000/- a year if rented out furnished on short-term basis and after deducting the 20% agency commission plus about AED 40.000/- for the 5 stars furnishing and approx AED 8.000/- a year for the utility bills, this will live the owner with a net AED 142.000/- (on occupancy rate of 79%)
The numbers speak for themselves however is important to remember that where there is a good return there is also a certain risk and many will agree that the most delicate figure of the above calculation is the occupancy rate which cannot be guaranteed in any property short-term rental management contract.
Keeping the above consideration in mind, would you wish to engage an agent for your short-term rental requirements, it would be wise to commit for an initial trial period of maximum six months, this period shall allow you to gather enough details and should give you a good idea about the reliability and actual potential of the agent/marketer you are dealing with.
Would you rather get more hands-on with the business, you could opt for a non-exclusive marketing agreement, also available in the market and you will be able to market your property through other agent/marketers and potentially increase your exposure however this is not necessarily the optimum solution in fact many agents will give priority to the properties of those clients with whom they have contractually committed with.
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