photo credit: jerone2

So the reality TV team has been in, built you a new house, decorated it, paid off your mortgage and handed you the keys. Surely your life is sorted? No mortgage, no worries.

But in Atlanta, Georgia, the Harper family may have taken their house makeover a teeny-weeny bit for granted. Three years ago, ABC’s ‘Extreme Makeover’ show enlisted 1,800 volunteers to tear down their old pad, get rid of their overflowing septic tank, and build a four-bedroom ’starter castle’ in its place. It was topped off with $250,000 in contributions for the family, including scholarships for their three children and a home maintenance fund, according to Associated Press. They even got a turret for god’s sake.

Reality bites

But clearly a turret is not as important as common sense. The Harpers decided to use their new home as collateral on a $450,000 loan, apparently for a now-failed construction company, and fell behind on payments. Their mini-mansion has now joined thousands of homes across the US and is in foreclosure. It will be auctioned off next week on the Clayton County Court steps. Gutted, but seriously, how many chances do they want?

Don’t take decorative rock for granted

The buyer who snaps up this property will be getting the aforementioned turret, decorative rock walls, a three-car garage, a lobby with four fireplaces, a solarium, a music room and a plush new office. Who wouldn’t want a foreclosed bargain with stylish decorative rock walls no less?

Sounds great for the lucky property investor who gets the keys, but what’s the moral of this story for the Harpers? Don’t look a home makeover horse in the mouth.

Technorati Tags: real estate, real estate investing, property, property investment

photo credit: Traveller07

If you can get past stereotypes of political instability, lions and flesh eating bacteria (Mycobacterium ulcerans in case you wanted to know), then you might be interested in what one Dubai-based property developer has to say this week. Kensington Real Estate has told arabianbusiness.com that it is set to focus on Africa for property development in the coming years.

Company director, Ashish Thakkar, told the website that the continent will be the next big thing in real estate development:

“Africa is where our aggressive focus is. We’re looking at hotel and development projects there. It’s the next big thing. What India and China were five years ago is what Africa is today.”

Media portrayals a setback

He believes that the main setback for Africa is the media’s negative portrayal and he’s hoping to put some positivity back in. Positivity in the form of $272 million worth of investment and the development of two residential and commercial projects in Africa, with a third project underway. Arabianbusiness.com also reports that they will soon announce a “very large” fourth project in Africa.

Rio signs up for real estate

The aforementioned third project currently underway is Kensington Luxury Heights, a 150-home residential community in Uganda. The developer boasts that footballer Rio Ferdinand has already signed up for a house there. The same Rio Ferdinand who has been employed by the company as brand ambassador for the project. Nice try. What’s next, David Beckham and Posh Spice moving to the Congo? I think not somehow.

Technorati Tags: real estate, real estate invetsing, property, property investment

photo credit: Kamal H.

If you’re desperately holding onto property you’ve paid a pretty penny for and praying to the God of Housing every night for redemption in the form of rising house prices, then fear not, your prayers might be answered. You’ve just got to hold your nerve until 2011.

According to The Home Truths 2008 report, 2011 is the end of the property Apocalypse. There’s no mention of exactly what day or time, but apparently salvation is on its way.

The report suggests that prices will continue to fall over the next couple of years, before perking up again by 2010 and making a full recovery by 2011, when the average cost of a home should have risen by 25 per cent to £274,700.

Up, down, left, right, feel sick yet?

Good news it seems. However no one appears to have told accountant firm, Deloitte, who have also released a 2010 property price story. Only theirs is at the moodier end of the spectrum. A comment from Deloitte’s reports is published on Thisismoney.co.uk, saying: ‘We now expect UK house prices to fall by about a third by the end of 2010 with severe adverse effects on household spending and investment.’ Right, we’ll put the party poppers away then.

Decisions, decisions

So what do you do? Snap up property now while it’s cheaper and watch your investment take a nose dive before it grows over the next few years, or put your faith in the accountants and steer clear? Depends on your opinion of accountants I suppose.

Technorati Tags: real estate, real estate investing, property, property investment

photo credit: ajagendorf25

We all know that property in the UAE is currently hot investment fodder with numerous weird and wonderful major developments planned, but off plan property speculation in Dubai could be about to send the market off the radar.

Emirates website, business24-7.com, reports that the latest sector report from bank Standard Chartered says that off-plan housing properties in Dubai are showing signs of overheating due to “ultra loose monetary conditions”, which trigger excessive speculation.

With demand far higher than supply in the country, planned new properties are being snapped up, rent on existing housing is high and prices are rising quicker than it takes Britney Spears to say ‘I do’.

Fifty per cent capital gains plan

In its report, Standard Chartered has suggested a few solutions to thwart you over-keen investors. According to business2407.com, these include changing payment structures and taxing capital gains - the figure of 50 per cent has been thrown in by Dubai authorities - made on properties which are bought and sold within 12 months. However, property investors who keep their property for longer than a year will be rewarded with exemption from the capital gains tax, and a pat on the back.

Property court on the cards

In another radical move, in September Dubai is also setting up a property court to deal especially with real estate issues, despite the fact that when the plan was announced there were currently no property cases pending.

With all these new rules and a big bad court to deal with, it won’t be easy to split from a property. So remember, an investment in Dubai is for life, not just for Christmas.

Technorati Tags: real estate, real estate invetsing, property, property investment

photo credit: faeryboots

If you’re having trouble shifting a property development, perhaps you could throw in some monkeys to sweeten the deal. Fed up of investing in boring old real estate? Buy a tiger with it.

These seem to be the new rules in Houston, Texas, as a Dubai property investor has sealed a deal on a former safari park, River Ridge. Arabianbusiness.com reports Rikander Ali, of Resham Investments, has bought the 64 acres for $750,000 from Thomas Abraham, an air-conditioning company owner who also invests in real estate around the Houston area.

Although the many of the previous residents, i.e. the zebras, camels, kangaroos, bears, lions, tigers, hippopotamuses and water buffalo have been moved on, the pair are still negotiating on the remaining 13 horses, seven cows, three donkeys and a bull.

‘New homes to be built on land’

The land also sits in the middle of an active oilfield and Arabianbusiness.com says Ali plans to reap the rewards of the oil until it runs dry, and then build new homes on the land. If Ali has ever been to Knowsley Safari Park and seen the damage that a group of monkeys and a giraffe can do to a car, I think he’ll be re-homing the animals well before he starts the property developments…i.e. Builder: “That sodding monkey’s got my hard hat on again.”

‘Donkey unavailable for comment’

Between oil, flesh eating animals and George Bush, Texas isn’t looking like it’ll be top of the list for property investment any time soon. Not this part anyway. And if you do decide to invest in a property here, lets hope there are no lions and tigers and bears (oh my!) left behind.

Neither the seller, the buyer, nor the donkey were apparently available to comment on the deal.

Technorati Tags: real estate, real estate investing, property, property investment

photo credit: Mooganic

When I saw the BBC’s ‘Eco-towns plan may be unlawful’ headline, I was quite excited for a second. Images of chaotic streets where the mafia rules and riots are a daily activity filled my head.

Of course, this isn’t the case. On careful reading I realise it’s the planning which could be unlawful, not the towns. Shame.

The BBC reports ministers are to publish a planning policy statement which will set out standards and potential locations in England for the eco-towns. But the Local Government Association (LGA) argues the proposals go against the principle of development through plans drawn up by local councils.

Just build it

Indeed the LGA says the government is trying to speed up the process by avoiding the normal systems – something anyone who has ever tried to build a house can only dream of.

If only constructing a UK investment property was as simple as the eco-towns approach – decide you want to do it, tell councils you are doing it (don’t bother asking nicely or applying for it), then scoff at developer proposals to deliver it and get them to come back with better ideas.

For sale: Gothic mansion in Sherwood Forest?

If it were as easy as this for everyone, property investors and developers would be making a pretty penny with ease, but no doubt an unscrupulous one would have slapped a Gothic mansion in the middle of Sherwood Forest and sold it to a family of American oil barons.

The future of homebuilding is a zero carbon-one. It has to be. But if it means the government rips up the fundamental rules of the game, I’d rather choke.

Technorati Tags: real estate, real estate investing, property, property investment

photo credit: Ruth L

US real estate firm Devine Reality, based in Kennewick, Washington, has decided that foreclosed homes have a bad image, so they’ve introduced a black stretch SUV into the equation.

Although for many this would normally conjure up frightening images of wild hen parties on a Saturday night, this stretch motor is to take home buyers on tours of foreclosed homes for sale.

‘Foreclosures aren’t garbage’

Owner of Devine Reality, Willie Stewart, told the Tri-City Herald:

“You know, we need to show people that foreclosures aren’t garbage.”

Although many foreclosed homes may be in need of a little TLC, there are bargains to be had. The Herald reports Stewart shows prospective buyers a variety of houses ranging from $100,000 to over $250,000 and even takes a home inspector and a mortgage loan officer along for the ride to answer questions.

‘2.5 per cent in foreclosure’

With approximately 2.5 per cent of all loans across the country in foreclosure at the end of the first quarter of 2008, according to the Mortgage Bankers’ Association, they’re not the only real estate firm trying to breathe some life into America’s property market. It seems thousands of others across the US are offering the same sort of tours and educating people on how to buy a foreclosed home at auction.

Who needs to see Mel Gibson’s pad when a ride in Willie’s SUV could bring you a property investment opportunity and a Hollywood fortune of your own?

Technorati Tags: real estate, real estate investing, property, property investment, foreclosure

photo credit: Wesley Fryer

Perhaps I’ve been watching too many westerns, but the UK property investment market does somewhat resemble a dry, dusty saloon in the 19th century American mid-west at the moment. Bear with me on this.

As prices continue to slump and jobs in firms specialising in building new homes start to go, it would appear we are approaching high noon. Or dawn. Or whenever it was back then that the shooting started.

In one corner of the bar you’ve got the local prospector, or Mr Bank Manager. Usually, he makes a lot of money out of everybody, but lately things are getting tough and someone is going to have to pay for that.

Sitting around a table is the local posse, or the sellers. They know something bad has happened, but they’re not sure who to blame or what to do next.

In another corner, flipping grubby playing cards onto the top of a crate, is a group of gamblers. Is it reasonable to label them the buyers and property investors? We’ll run with it anyway. They’re as surprised by the situation as everyone else, but at the moment they are just waiting to see what happens next.

For the estate agents, ‘town is dead’

At the back of the room, busily watering down the bourbon, are two bartenders, or the estate agents. They’re used to getting plenty of business, but at the moment town is dead.

Finally, loitering outside, unsure whether or not to wade into the atmosphere within, are the local sheriffs. Mr Bank of England and Mr Labour Government. Both are not sure what to do to calm things down and fear getting too involved will kick it all off.

Sellers cut house prices – now what?

Of course, at some point, someone is going to have to blink and go for their guns. Which group ends up in the strongest position at the end of it all is anyone’s guess.

According to figures from Right Move, the sellers have cut their asking prices by an average of £4,345 in the last month. Is this a sign that their fingers are waggling over their holsters? - ‘Your move punk’.

Technorati Tags: real estate, real estate investing, property, property investment

photo credit: *PaysImaginaire*

If I could, I would play superhero music to start this blog. If only we had some sort of Spandex outfit and a cape to put Caroline Flint in….maybe not. But she and the government have just announced another rescue package to bolster the housing market.

One of their brand new ideas, which is not at all similar to a scheme some property developers introduced months ago, is to introduce ‘rent now, buy later’ packages (sound familiar).Only this time it’s just for first time buyers on a household income of £60,000 or less, who will be able to move into a house with an 80 per cent reduction on rent and save for a deposit over two or three years.

Get cape, wear cape, build homes

To help seemingly doomed house builders, and to meet the government’s target of three million new homes by 2020, ‘local housing companies’ are to be set up. These will consist of councils and private companies working together to provide new homes on land earmarked as surplus. Pilot schemes will be run in four areas - under Barking and Dagenham council, and Newcastle, Nottingham and Manchester councils. The councils taking part will share a nice pot of money totalling £510 million. There are also plans to build up to 75,000 new homes in 20 towns and cities which have been classed as most in need.

‘Put pressure on mortgage firms’

But not everyone is impressed, both the House Builders Federation and Shelter are quoted in the Guardian as suggesting the pressure should be on mortgage companies to start lending again, while Liberal Democrat spokesman Lembit Opik said of the scheme:

“Another day, another new affordable housing announcement. The government’s hot air will not hide the fact that 10 per cent fewer shared-ownership homes were provided last year than in 2006.”

Will anyone really listen to Mr Cheeky Girl?

Technorati Tags: real estate, real estate investing, property, property investment

photo credit: easement

Technorati Tags: real estate, real estate investing, property, property investment

I’ve learnt valuable lessons about behavior through my current lack of funds, such as - not having two pennies to rub together makes me negotiate hard - because I have to. I give the impression of being a tough negotiator, when really I haven’t got the option to tread the middle ground. It’s all or nothing.

If I had the funds – I would have paid, as Formula 1 racing drivers would say – ‘for sure’. Yet in this game of chicken – which I didn’t realize I was playing – it’s the mortgage lenders who have blinked first.

To give you some background: After one of my properties was sold with a thumping great loss, the lender pursued me for the unsecured debt. Following a brief telephone call, I’m informed that the lender will accept a settlement of 50% of the total.

What’s wrong with education?

All the way through the repossession process I am reminded that our education system isn’t what it could be. My situation is down to a simple calculation – more money went out than came in. After a few months, I couldn’t make up the shortfall so I stopped paying the mortgage and the property was repossessed. So the lender in its infinite wisdom gets the village idiot to phone and ask if I can pay a cash settlement of tens of thousands of pounds, and guess what – I can’t.

Hard ball

Weeks and months go by with weekly calls requesting that we come to an agreement. Then we reach the end of the road. The lender sent a demand with the next step being bankruptcy. I call to discuss the situation and immediately the lender agrees to slash the debt by a further 50%, for an instant cash settlement. I explain my financial situation and the lender agrees to accept a few hundred pounds in full and final settlement. The lender has finally recognised that they are looking up the barrel of a gun, and so accepts something rather than nothing. I’m relieved that this battle is over, and look forward to many more soon.

What’s the lesson?

The lesson is: Always negotiate as you will be surprised by how much money you can save. It was easy for me, because like I said – there was no middle ground for me to tread.

This is a lesson learnt and one that I will use when I start to see better times ahead. The lesson for you is: Just because your not looking down the barrel of a gun, don’t think that you shouldn’t negotiate hard on anything. What’s the worst that could happen?