3 September, 2011 No Comments
When you buy off plan, you are buying a project that does not exist, but the amount of money paid is real, and DOES exist.
… Please note when buying a property from architectural plans:
1. Specify the total price and payment method. This price in theory should not vary unless renovations that could not be prevented arise at the time of the contract . Buyers though, must agree whether they accept these increases.
2. Identification of the architect, builder, and the seller
3. Specify statutes and rules of building to all homeowners. Determine the community’s contracts and supplies.
4. The construction company will deliver a general plan, detailing the location of the house, specifying electrical installation, gas heating, fire safety measures, etc..
5. Data from the property bureau, authorizations, permits, licenses…
6. Specify Delivery date
7. The buyer’s right to choose the notary’s office.
8. Document describing the property, useful space, the building in which it is located, common areas, ancillary services.
When measuring risks, the fact that both parties agreed on a delivery date, and a compensation in case of delay, are good guarantees to the buyer, who could then claim for damages.
1 – Market fluctuations make it difficult to predict whether the selling price reflects the actual market value at the time the work is finished (could easily be 24 months).
2 – Given the possibility that the developer ends up in bankruptcy, insolvency, or starting a bankruptcy, you must be aware if there are any bank guarantees to ensure all payments made in case that the developer does not finish the work. In this case the buyer (you), who becomes a creditor, has one month to gather all the documents and present them to the bankruptcy administration. Emphasizing that the property was not delivered, or the construction work did not begin on the agreed date, the buyer may terminate the contract, and execute the guarantee that ensures the amounts paid in advance. However, if you do not have this guarantee, or insurance to cover these payments, you must wait for an arrangement with other creditors or liquidation of the company.
A company in bankruptcy should continue the work under the orders of other supervisors appointed by the judge. Perhaps due to liquidity problems, another company may proceed to finish the works, in which they may suggest new conditions of delivery or payment for compensation.
When the delay has been confirmed and the contract terminated, you must go to the bank and present the original guarantee (it’s important that the deadline has not expired). Although the promoter is in bankruptcy, the bank must pay the guarantee. If the bank refuses to pay, you can also initiate a complaint against the bank.
When the buyer wants to go on with the purchase, he must keep meeting the payments. However, one must realize that it would be wiser, as long as you have not disbursed more than 20% of the total price, to stop paying. The amounts paid to date will be lost, but at the same time you avoid a long lasting process and losing more money. Today, with the current discounts in real estate it is easy to find a similar product, and perhaps with better economic conditions.
Reasons for which the buyer may not want or be able to continue with the purchase:
* When the seller has breached the contract, ie there is a delay in delivery, you can seek the termination of the contract or to recover the money advanced + the appropriate compensation.
* If you have a guarantee from the seller, go to the bank. This delivery delay, which is considered a partial default, is not enough reason to terminate the contract and the buyer must pay the payments; only when it goes over the time prescribed by law, will be considered total breach of contract, and thus subject to return the amounts paid + the interest.
* If the seller has not breached the contract, nor there was a guarantee, and the buyer wants to terminate it unilaterally, he must negotiate with the seller the cancellation of the purchase, claiming to the seller the money paid to date at the court. In the event that we are talking about a contract that cannot be canceled, the new owner must continue to pay the payments on time. However, if there was a deposit, the contract can be canceled losing the amount deposited in the first place.
Regardless of which country you are going to buy a property off plan and of its legislation, it is important to keep in mind these brief remarks before signing a purchase of this type. Given the nature of the country’s real estate law, which may differ from ours, it is highly recommended to always count with a lawyer, no matter who the promoter is.
2 September, 2011 No Comments
Risks and advantages of a fairly common way of purchase.
To purchase a property out of the arquitecture plans is common in countries like Spain, which have had a large market of new construction, as well as in other developing countries such as Greece, Crete, Panama, Brazil, Turkey, Egypt or Morocco .
Why do people choose this purchase method? On one hand involves savings, which in some cases can reach up to 30% of the final price once the property is completed. It also allows the new owner to make changes in materials, and the distribution both inside and outside, example: increase the size of a room, change a terrace, or increase the size of the pool (in contrast, in a finished house, it is more difficult and expensive).
However, the buyer of a property out of the architectural plans bears many risks. In the first place, he has to make a deposit upon signature of commitment of the purchase contract, then the promoter requires him to make a number of advanced payments before they finish building the house… ie when the house structure is complete or when the roof is finished …. the process keeps repeating itself until the house is completed and the final payment made. This process may take 18 to 24 months or sometimes even more.
In some cases, investors buy the property off plans and sell it when it’s finished at a higher price. In other cases, they buy the property off plans and sell it before it’s finished, thus assuming only the deposit and early payments and avoiding the last ones. This strategy was very profitable when the market was favorable, with profits of nearly 20%.
In the current market, where sales are stuck, the risk is much higher and the appreciation of the capital invested is almost inexistent. Since it’s difficult to sell an unfinished property the buyer will have to make all remaining payments. Under these conditions, we must have the money to cover all the payments and bear in mind that in two years, mortgages are subject to change.
The property’s delivery date must be clearly stated in the contract (month and year), specifying whether the possibility of extension exists. To treat possible delays in the delivery of the property, parties may have previously agreed to a penalty clause that covers compensation for any costs (moving furniture, rent …) according to the days or months of delay.
All of these details should also be specified in the pre-arrangement that is signed at the time of the deposit, with the house details (square meters, location, quality specifications and equipment), and the price and interests agreed on.
Even if delivery is made under the agreed time, we must verify in which conditions was delivered . The home must be completed with the “end of construction” certificate signed by the architect who led the work, and the adequate licenses and permits: first occupation (for private housing), and final certification (in public housing). If they are not in order, utilities companies will not accept it and you will not have water, electricity… to live in a house with no license could lead to a penalty from the public administration. If a delay does occur, a first request is sent to the developer to deliver it (ie. Bur fax with receipt requested). If after two months the property has not been delivered, another similar requirement prior to a lawsuit. After 6 months, then you can start to process a legal claim (it is recommended to keep all costs that this delay has caused to the buyer, to attach them with the claim).
Buying a property off plans has not been recommended for a couple of years now. During the housing bubble, if the developer was a good professional, the buyer got his home in a timely fashion and at the agreed price. But in many cases, complications arise and the buyer can lose the house and the amounts paid in advance. There are buyers who find themselves in this situation because at the time they agreed to sell this way. In my next post I will explain the process to be followed in our country when problems with the purchase of a property arise.
1 September, 2011 No Comments
Designing lighting for architecture and decoration.
Nowadays illumination is very important to complement the design and decoration of homes, businesses, industries, streets or roads. A wide variety of electric lamps exist in the current market, but the trend is to minimize energy consumption. Semiconductor diodes or LEDs make the difference (see previous posts).
Different types of lighting
This image shows the evolution: four generations in illumination technology: incandescent light, fluorescents, compact fluorescents, and OLEDs in different colors, considered the near future in lighting.
OLED is the organic version of LEDs. The differences among them are 
considerable:
* Instead of producing a bright spot, as LEDs do, they produce uniform illumination over a large area.
* OLEDs, are supported in a thinner, more flexible and luminous material than crystal layers of LEDs since the substrate used can be plastic.
OLEDs
*Economically more affordable: Although its production is currently quite expensive, its cost will be reduced considerably when they reach the mass-production stage. When that occurs, its cost could be the same as the cost of the material in which the OLED is printed. Thus being more competitive in comparison to current LEDs.
OLED support
* The result is a better contrast and brightness, since the pixels or dots emit the light directly.
* Allow new architectural applications, ie; paper with light, its integration into furniture, worn on clothing, or other forms of implementation yet to be discovered. Somehow, lamps for homes will disappear. It is expected to reach its commercialization phase in 5 years, both for decoration and functional lighting. However in order to be fully commercialized and added into our daily lives, we should expect 10 years.
* In addition to emitting light, researchers are working so that the new version of OLEDs can absorb also solar energy to produce electricity.
* The problem is that its organic components, molecules and polymers, are difficult to recycle. They also suffer high levels of degradation when they are exposed to water.
* Currently its use it’s expanding to TV screens, computers, mobile phones, MP3, billboards, and as light sources, to illuminate general spaces.
The importance of lighting in architecture increases every day, since the facades of new buildings, hotels, museums, gardens, plazas, streets, monuments, and many more, as well their interior, are enhanced with specific forms of illumination…… (remember that it is quite hard to make good lighting projects, both indoor and outdoor.
1 September, 2011 1 Comment
That is, to buy only part of the property, which is different than timeshare or right of use.
Fractional ownership allows the buyer to purchase only a portion, instead of owning the total property. This method was originally used in the purchase of yachts and planes, but for the last two decades has been applied also in the American real estate market, and also in areas of Europe that tend to have a year round occupancy, i.e. Golf Resorts Algarve (Portugal).
Buying a share of the property, usually between 1 / 4 (to use 13 weeks per year) and 1 / 12 (one month of use), carries a small down payment, which instead of buying an entire property, allows you to buy small fractions of different properties in different locations. Another advantage would be to buy a portion of a much larger house for the price a little one.
Keep in mind that if you buy a quarter of the property, the cost will be slightly more than one fourth of the property’s market price. This increase is to bear with administration costs, which involve the management of the estate by a company that will have the property always ready whenever there is a change in use (repair, maintenance, cleaning, gardening, etc) . These are monthly expenses, and therefore we must take into consideration this additional cost when choosing this type of purchase.. 
The idea of fractional property shall not be confused with the figure of timeshare property that was very popular in the 80′s. The differences are:
1. Buying a fractional property is similar to buying an entire property, the owner’s name appears in the documents that guarantee the ownership of a part of that property. It is called ” common tenancy” with other owners. The owner may sell, rent or take a mortgage on that part of the property during the time he has allotted for its use. On the other hand, timeshare property only sells time of use (right of use), instead of selling a property title. The value of this “time” will usually depreciate over time. Instead, fractional ownership on a property, if the market improves, will be appreciated as any other owned real estate.
2. With timeshare, if the managing company is dissolved, the person who bought a right of use, may be at risk. This does not happen in the purchase of a fractional property because shared ownership is independent of the management company.
3. In many type of timeshare, the time is bought in hotel rooms or apartments which may vary each time, because investors are only owners of the time. In fractional ownership, you get part of that home, it will not change.
To sell fractional ownership: If there is no special provision in the contract, the property can be sold at any time and recover the portion of the initial investment (or more if the property has appreciated over time), but usually there is some sort of extra charge. Depending on the terms of the contract, some companies may offer to repurchase the fraction, and others act as brokers and charge a fee in order to sell it privately.
Some fraction contracts are signed for a certain period of time, and after this period all the owners may sell the property, to be divided equally among all of them. It is also possible to start another period with the same conditions, or if a co-owner wants to buy the entire property, he will have preference over any external investor.
Sometimes doubts arise about the purchase of a property… Why should I buy it if I will not get the most out of it? Here are the advantages of fractional purchase:
* Instead of assuming the total costs of owning a home, divide the cost of furnishing, maintenance, insurance, repairs, security, tax, among all co-owners ..
* The company that manages the property will take care of the maintenance problems, if any, that entails having a second residence ….. when you arrive everything is in perfect conditions ….. when you leave you don’t have to worry either, because the house will be in perfect condition.
* You do not need a large amount of capital invested in it, and you can allocate the rest in other investments.
* An empty house always carries a higher risk, but in this case will be inhabited most of the time
* Owners of second residences, often use as much of the 4-12 weeks per year. Fractional ownership makes the purchase price match with the use that is given to a holiday home.
31 August, 2011 No Comments
You make your money When you BUY, NOT When You SELL.
This is one of those phrases that professional real estate investors believe and follow …. and the places with more supply per square meter is at the fairs. 
The Property Investor Show & OPP Live was held in London in late 2010. The most relevant facts during this real estate exhibition were:
1 – There was a live auction with more than 200 properties. Even if you previously hadn’t participated in real estate auction, I encourage you to go see one to learn its dynamics, the purchase before and after the auction, the closing of good business, or the rules to perform this type of purchase, etc.. 
2 – In the English market, and in the international (but in a smaller scale), there is the possibility to “buy fractional”, ie. to buy a part or portion of the entire property. It is a figure that has considerable popularity in a market like the one we have today.
The approach is aimed at the holiday home as an investment. Second home buyers seek homes that require them to give a small down payment, with low building expenses, and few financial risks … but that allows them to benefit 100% from their investment. It differs from multiowners, which means only a right to use the property x weeks per year. (I’ll make a post detailing this type of fractional purchase).
3 – Almost half of the exhibition was dedicated to the international market, with potential countries such as Spain and Portugal for the English market, as well as new destinations to invest, such as Cyprus, Greece, Africa, Egypt, Brazil, Swazi and Turkey (the ones that had great reception in the English market were mainly: Cyprus, Turkey and Egypt). 
4 – In particular, Egypt was the guest country, with many product developers offering the best destinations in the Red Sea. Egypt is considered one of the leading emerging markets in the property sector because it is generating great interest from international markets to invest there.
Many of the reasons to invest in Egypt are: good sustained economic growth, cheap labor and land, and a booming real estate market. A great thing is that the RE market is interesting to both, domestic and foreign customers.
Among the advantages of buying in Egypt is the exemption of tax rates:
* The purchase and ownership of a property is exempt from taxes, both inheritance and capital gains.
* The administrative charges, if any, are very low in general.
* There is an estimated return on investment between 5 to 11% depending on the type of property.
* The areas of the Red Sea are the most popular for tourists and the demand for vacation homes is located in Hurghada, Sharm el Shiekh, and Gouda.
* Theoretically, when buying a home it is not necessary that it be registered in the deeds of the property, although the possibility exists if a buyer decides to register his property paying a fee for it.
5 – There were about 130 seminars of about 45 minute each, in addition to the exhibition, with the idea to reflect this continuous change because new markets are opening at the same time, and new creative ways to face sales and marketing are emerging ….. It is said that the money exists, but will exist only for companies that are prepared to give in exchange good business prospects ….. It is also interesting the idea that investments in “passive properties”, for example student apartments or hotel rooms, should be part of investors’ portfolios as investment alternatives.
Tags: Africa, Brazil, Chipre, Elgouda, excel london 2010, fractional property, Gambia, Greece, Hurghada, international RE market, Investments in Egypt, London real estate fair, multiownership, Property investor show, purchase tax, RE properties in the Red Sea, Real estate auction, Red Sea, Sharm el Shiekh, Swazilandia, Turkish real estate market
Category: International Real Estate, Real Estate Fairs, Real estate investment
30 August, 2011 No Comments
The Spanish developer Nyesa soared 16% in an intraday session last year, following the agreement signed with the U.S. investment fund Wilson Capital Group (WCG). This american financial group acquired 20% of the project to build a luxury resort in the area of Puntarenas in Costa Rica, aspiring to be one of the most important in the area.
This agreement amends an earlier one (that I discussed in a previous post), in which WCG was limited to finance the project with a loan of € 330 million.
The agreement, which was being reported as of mid October 2010 to the CNMV (the Spanish Securities Exchange Commission), included Nyesa Costa Rica’s transformation into an SA (corporation), thus changing its capital to USD.
The contract obliged the American group to pay the amount in three phases before the end of 2010.
The megaresort will be located in the Oso Pensinsula, in the province of Puntarenas, with a humid tropical climate, very warm all year round, with a temperature between 22 and 35 º C. That particular area is surrounded by natural parks: Corcovado Park and the Monteverde Cloud, Marina Ballena, which provide shelter to rare species. It is therefore a popular eco-tourism spot due to its exotic flora and fauna. Its diverse landscape, tropical forests, and a sunny coast with great waves suitable for surfing, make it one of the most frequented areas of the country, despite of their great communication infrastructure.
This stretch of the Pacific is a U.S. tourist destination, since it is quite comfortable for them to take a week off there. But nowadays, they are buying more attracted by the good weather, safety and economic standard of living. As a consequence, many areas are developing major shopping centers and private residential compounds.
29 August, 2011 No Comments
A Real estate fair that shows a market undergoing a deep transformation
Former Minister of Housing, Beatriz Corridor, opened the show a year ago in company of F. Baltasar, Counselor of Environment and Housing of La Generalitat. This occurred during the time in which President Zapatero was considering to eliminate the Ministry of Housing in his government reshuffle, whose tasks would then be under responsibility of the Ministry of Development led by J Blanco.
The show was hosted in Montjuic showing the large supply of homes available at the time, both first and second-hand homes, as well as store and office space, parking lots, which, as was seen in other real estate exhibitions around the country, were a big chunk of the bank’s portfolio.
The show’s international section had a wide representation from Russia. There was still a close relationship with the Arab Union for Real Estate Development, and there was a delegation from South American countries, i.e. Argentine and Colombian businessmen looking to find Spanish partners to invest here. In the Symposium, held at the same time, the representatives of Colonial and Morgan Stanley, believed that international investment was starting to show interest in the Spanish housing market, not so much for developers but to create personal wealth, and always at attractive prices … . this was referred to as possible competitors to the Spanish family offices, which were those that had been buying quite much in previous years.
Exhibitions and fairs are generally intended to present to the public and the specialized sector the latest industry trends, showing the existing product supply at the national and international level. That gives a quick overview of; the evolution, market trends at that precise moment and of the future for each particular sector…… But in this case it is very difficult to predict the evolution of the housing market but also the new skills that the job market will demand in the future (either by the changes that new technologies have introduced, or the differences in advertising, or the easy access to foreign markets to both buyer and seller (globalization), or energy conservation and respect for the environment, etc. ..).
It ‘s obvious that the real estate business that will emerge after this crisis, must come with drastic changes, as we currently witness this transformation process. When the market reactivates, it should be more environmentally responsible … To point out; the information about the crisis have proved to be inaccurate as well as the forecasts about the behavior of the economy …. and recovery in Spain seems to me like a snail trail.
A conclusion for the future could be that the new market must be created by all of us all, bearing in mind a greater economic rationality.
Tags: Arab Union for real estate development, Argentina, barcelona meeting point, Beatriz Corredor, Colombia, Colonial, Energetic savings, F. Baltasar, Generalitat Environmental department, globalization, Ministry of Housing, Ministry of public affairs, Morgan Stanley, Real estate Crisis, real estate fair, Russia
Category: Real Estate Fairs, Real estate investment
28 August, 2011 No Comments
Know the reasons why you want to buy and have a list of priorities… these are the most important factors to determine the best places to buy your property
It is not the same to buy a vacation home than to buy a home only for investment purposes …… Due to globalization it is less uncommon to buy a house in foreign territories, especially because purchase prices are usually more affordable than in Spain, or Europe in general. The good climate of Spain made it, for many years, one of the main countries in the Mediterranean chosen by French, English, German, Dutch and Belgians as a retirement destination and also as a place for their second home. Nowadays, due to a stronger €, the Spanish people are those who invest in emerging countries where house prices are still cheap in comparison to the prices that have been paying here in recent years.
1 – In the case of purchasing a vacation home the idea seems relatively simple; to find a sunny place where we can escape to relax. But we must go further and think realistically …. How many times a year and for how long am I going to go?…. Do I need to rent the house when I’m away to cover the maintenance costs? If so, how many months per year should I rent it to break even? It is therefore important to carefully study the climate of the area, with its seasonal cycles, rainfall, hurricanes, etc.
One should know what’s the available budget and the total cost that entails. For example the distance is more important than one might think, because in the long run travel costs add up (shoot numbers if you are thinking about a family…), and can end up being much more expensive. Suppose you choose to invest in Malaysia, where it is relatively cheap to buy a house by the beach. If the trip is expensive or airlines do not have direct flights, then you must make some flight connections, the trip is usually expensive and uncomfortable.
2 – In the case of purchasing a property as an investment purpose, or perhaps to enjoy from time to time, it is crucial to consider which areas are suitable for a capital disbursement and study how the resale market behaves. We must also take into account currency variations and the risk that it adds into the transaction.
If the purchase is solely for an investment purpose, then the distance between the place of residence and country of destination is irrelevant. What’s relevant is to evaluate whether they are regions with a high demand by both nationals and tourists. Finally, you should have the strategy to sell in order to be ready when the time to sell arrives: it is preferable to buy in an area where not only local buyers are active, but an area that has a strong local and international market, which would make a possible sale faster and easier. Such examples may be: Tenerife, Laco di Como (Italy), Orlando (Usa), and cities like Paris or Barcelona, as they are locations with a high demand for vacation rentals. Riskier investors could check out opportunities in countries farther east.
3 – If the purchase is intended to settle/ retire and live permanently in the new country, decisions are perhaps simpler, with valuations such as the climate, cost of living, taxes and quality of life (if so, you must also study the job market or how to meet the needs of a family). You have to see the difference between buying a vacation home or a first residence. Tourist areas have a high demand for a few months out of a year, but the remaining months are almost dead with fewer services that supply the area. You must also assess what kind of winters does the area have.
The Mediterranean coast of Europe, combines a good climate with great communications and accessibility. Traditionally, the most popular countries are Spain, Turkey and Cyprus.
Basic ideas to consider before making a purchase:
* If possible, execute your own market research “in situ”. Ask questions, see different options and look for multiple information sources.
* If rental is important, bear in mind that demand for rentals may differ throughout the year.
* Realize that mortgage conditions, if necessary for the purchase of this particular home, vary widely from country to country.
* Finally, as I previously mentioned, know exactly what’s the purpose of your purchase; this will facilitate what kind of country or property best suits you.
Tags: barcelona, Chipre, Egypt red sea, emerging economies, homes for retired people, invest for retirement, MALAYSIA, ORLANDO, paris, Red Sea, second residences, summer homes, Tenerife, to buy a property around the world, Turkey, vacation homes, weather and decision to purchase
Category: International Real Estate, Real estate investment
28 August, 2011 No Comments
Have you ever seen a €27 million house… ?
If we take a look at this particular work of Steve Hermann, a designer of upscale homes for artists and entrepreneurs in California, we are witnesses of a showcase of modern design and minimalist luxury in architecture. The lighting is extremely well distributed around the house, enhancing its existing open spaces, and the house’s finishing touches are impeccable.
As its name emphasizes “Glass Pavilion”, the majority of its facades are made of glass. For its implementation they have chosen a particular type of glass that is especially bright and clear, the one used for cabinets of jewelry stores.
The construction was completed during the summer of 2010.
It’s an unusual residence, with an area of 1,289 m2, built on a large plot that allows it to maintain total privacy from neighbors. It is located in Montecito, California, although at a first glance you might think its a European home due to its design.
The owners enjoy high quality comfort and at the same time are completely surrounded by nature.
The residence counts with 5 bedrooms and 5+ bathrooms, and wide living and dining rooms. The kitchen is highly designed, spacious, bright and functional at the same time. The house also has a large wine cellar, and what can be described as corridors or areas that have been decorated with pieces of art from the owner’s collection.
It also has an unusual garage, to name it, with a space for 32 cars that currently accommodates the owner’s entire collection of classic cars.
If we look at the property from the main entrance, it gives us the idea of a one level house, because we can only appreciate a single level above the ground. However, the architect actually played with the uneven piece of land to build an inferior level, which is also quite exterior, where the garage seen in the picture is located.
It is difficult to find a flaw in the house’s design or decoration. I believe it is visually stunning and that conveys a feeling of fresh luxury …… But if I were to live in it, and if I am allowed a suggestion, it wouldn’t hurt to put some blinds in the bedrooms to avoid the morning light and to get more privacy, and perhaps to make it warmer.
From an architectural point of view, it does not add anything new, since it is similar to the Glass House designed by architect Mies van der Rohe, founding father of the theory – less is more – where we also see a minimum number of different materials used, and the avoidance of ornamental decorations. The idea being that the glass transparency allows the visitor to feel protected by the roof, but without the feeling of being inside a building because its transparency makes the exterior its decorative element.
27 August, 2011 No Comments
This post is based on the conclusions of a Spanish entrepreneur who moved with his family to China, and he did his own market research to find a home there.
In China, homes are concessions of 70 years (apparently, they are considering to extend the concession to 90 years). If an investor purchases a brand new home, the concession is for the whole period.
In regards to the Real Estate second hand market;
* If the home is bought in the second hand market, the new owner should subtract the years that the home was previously inhabited to the total period of the concession.
* An interesting fact is that there is small market for rehabilitation of buildings or homes. Chinese are not used to perform regular maintenance to a home (ie; to give maintenance to the building’s garage or facades, or to paint the stairs and the house itself). This leads to visible impairments in a short period of time and therefore the buyer chooses to buy a new apartment or house. (This might be a possible gap in the market that should be carefully studied and be a great business opportunity).
* It could be inferred that second-hand homes in China are not as attractive as new homes. The vast majority tend to search for first hand properties due to the large existing supply across the country. We are talking about an immense market of new homes. However, in the country’s main cities, especially in the city centre (first ring) where the housing market has settled, supply of homes in the second hand market does exist.
The loans offered for the purchase of a home, can amount to 50% of the total investment. NO matter if home prices are fixed, one should always negotiate with the seller, in addition to a 2% discount for early payment. The realtor’s commission is paid by both parties.
Since China is a developing country of considerable size, large cities such as Beijing or Shanghai are not the only ones experiencing this kind of growth, existing cities in the suburbs referred to as “third” or “fourth ring” also follow this trend. These peripheral areas are usually well connected with either high speed trains or a growing subway network.
High speed train networks communicate in a quickly manner people’s homes with the city centers and workplaces. As well as the subway, which makes up the price a house along a station and with good communication (as would happen here).
There are ghost towns, mostly bought by investors who want to own. Taking into account that his mentality is geared toward work all day, have few expenses, and thus, saving. This allowed them to pay a flat to a son (usually one child per family), although now it is changing, as children salaries are older than the parents’.
In order to appreciate the different areas, despite the large price increase that homes have suffered throughout the country, we see that:
The Hainan Province is a high class residential area with tax advantages. There are promotions of modern design, with resorts and golf courses. It is a very nice, and quite wet area due to its proximity to the sea, located in the south of the country. It is best to buy high apartments and away from the sea to avoid deterioration. The capital, Haikou, and the area of Sanya are also quite expensive. Sanya is a tourist town with an artificial island connected by a bridge. The group of MAD Architects has designed PHOENIX 2, a luxury destination that will be completed by 2014. Since Northern China is very cold, this area is considered a good summer place to spend under the sun. Its target customers are Russian and Northern Chinese. The price of housing in the area is rising at a fast pace, reaching five times its annual price.
Other parts of China are more affordable. Areas that can be a good place to reside are: Guangzhou (near Hong Kong), and Guiling, a beautiful city that will be connected to Shanghai by a high speed train (340km / h), that is still under construction. The price of the area will rise considerably. As of 2010, the highest price to pay would be around 2,000 € / m2, but one can also find housing for 200 € / m2 outside the cities.
Beijing, the capital, has a very extreme weather, such that good conditions only last two months because August can reach up to 40º C. It’s a dense city in terms of people and with high pollution levels. It would be interesting to buy a house in the capital for investment purposes.
Tags: Beijing, china, Guangzhou, Guiling, Haikou, Hainan, Hong Kong, Mad Architecture, new homes, Sanya, TGV
Category: Architecture, International Real Estate, Real estate market
