New study reveals best value conveyancing services in Europe
A European Commission study has found that deregulated legal systems, such as that in England and Wales, are better for consumers in terms of price and choice of conveyancing services (legal services associated with house and land sales).
Conveyancing services comprise, for example, pre-contract searches, transfer deed drafting, signature certification and deed registration in the Land Registry.
The study, the first of its kind, surveyed the cost and performance of conveyancing services in 21 EU countries. It concluded that a deregulated system performs better than the notary system, which is used across most of the continent.
The deregulated system in England and Wales is cheaper than the notary system and also secured strong results in terms of quality of service. The survey found that England and Wales falls into the lower range of transaction costs at between 1% and 7% of the property value – along with Scotland, Ireland, the Czech Republic, Denmark, Portugal, Slovenia and Sweden.
Property turnover across the 27 countries that now make up the EU was €1.8trn in 2005, with the corresponding turnover in conveyancing services being around €16.7bn. England and Wales with 11% of the population and 15% of GDP contributed 30% to property turnover.
The Commission will now consider whether to take action to liberalise access to conveyancing services, a position supported by the UK Government.
The study was led by Professor Christoph Schmit from the Centre of European Law and Politics (ZERP) at Bremen University.
30% of Czech population expected to be foreign by 2050
The shortage of young, skilled workers across Central and Eastern Europe was confirmed this week when a new study revealed that foreigners could make up 30% of the population in the Czech Republic by 2050. In order to keep the Czech economy growing it is estimated that the number of foreigners will need to increase to 7.5% by 2020 and 30% by 2050, according to a study by demographers at Charles University.
A plan is being discussed by the Czech government and business officials to give qualified foreign workers green cards, which would make the country one of the most open in Europe. Facing a shortage of qualified workers, big companies based in the Czech Republic such as IBM, are already reported to be actively trying to recruit staff from other countries.
The report estimated that most immigrants to the Czech Republic in the future will come from the former Soviet Union, Vietnam and China.
Office stock in Warsaw to increase by 30% by 2009
Total office space in Warsaw is set to rise to 3.5m sqm in 2009, which is 30% more than the Polish capital currently has, according to a report compiled by DTZ.
Last year saw record growth in demand for office real estate, which in turn pushed down the vacancy rate in Warsaw to 3.1%, DTZ analysts claimed. It also led to a rise in the total number of transactions for new offices concluded prior to their completion – 44% of the total.
In 2007, some 211,500sqm of new office space came onto the market, as a result of which the total pool of office space in Warsaw rose to more than 2.7m sqm. There was also a surge in demand for office space in smaller cities, such as Lodz, Poznan, Katowice and the Tri-City area.
Last year the total supply of commercial space in Poland amounted to 7.6m sqm, more than 70% of which was located in shopping centres and another 19.5% in warehouses. This translates into growth of almost 44% in relation to the previous year. Around 1.2m sqm of new retail space is currently under construction to be completed within the next two years.
Meanwhile, the warehouse and industrial real estate markets grew by 63% in 2007, bringing overall stock in Poland up to 3.7m sqm. Last year, demand for industrial space in Poland amounted to 1.4m sqm and DTZ analysts estimate that demand will remain at a similar level this year.
EC wants second Danube Bridge operational by end-2010
The bridge linking Vidin in Bulgaria to Calafat in Romania should be operational by the end of 2010, Jeroen van Oel from the European Commission's (EC) directorate-general for regional policy told Bulgarian officials last week.
The bridge was expected to be ready by April 2010 but has been delayed because project engineers rejected the initial proposal put forth by the contractors building the Bulgarian side of the bridge. It has also run into regulatory trouble on the Romanian side but this is now reported to have been resolved.
Bulgaria will contribute €60m in funding for the bridge, with €70m coming from both the EU’s Ispa pre-accession aid programme and the European Investment bank. German development bank KfW has lent another €18m.
The bridge will be almost 2km long at 1,971m.
Worldwide News
Land reclamation almost complete for phase one of Palm Deira
Dubai developer Nakheel says that it has now reclaimed over a quarter of the land required for Palm Deira, the biggest of its three Palm island projects in Dubai. Despite only a quarter of the land being reclaimed, the unfinished palm is already bigger than Palm Jumeirah, which is the most developed of the three.
Nakheel says that 80% of the first phase of land reclamation is completed, having used 300m cubic metres of sand. Once completed, the Palm Deira will be 42m square metres , which it says is around half the size of Paris, France.
Average property price fell $4000 in New Zealand last month
More evidence of a slump in the worldwide housing market emerged today with news that the average sale price of properties in New Zealand fell by more than $4000 (£1,600) in March, according to figures released by property information company Quotable Value (QV).
The figures showed annual house price growth of 6.5% in the year to March, down from February’s figure of 7.7%. Christchurch stood out as one of the cities to buck the trend though, with its March average sale price of $365,665 up from February.
As well as interest rates and lower immigration, commentators blamed media reports. QV national spokesman Blue Hancock reportedly said although sale prices were dropping nationally, it was part of a normal cycle: “Quite possibly we can now expect it to go backwards, but if history repeats itself, there won’t be a 30% decline as some are predicting.”
Hancock added that the softening market was to be expected after prices have appreciated by more than 50% over the past three years.
South African property investors choosing residency in Mauritius
Wealthy South African property investors are starting to sidestep heavy local taxes on their rental incomes by investing in holiday homes in Mauritius, and gaining the added bonus of permanent residency.
By purchasing a property in Mauritius and staying on the island for just three months a year (over a three year period) South Africans can become resident on the island and pay far less tax than in their homeland. The income tax rate in Mauritius is currently 15% up to £10,000 a year then 22.5% on income over this amount. However, in July 2009 there will be a flat rate of just 15% on all incomes. This compares to South Africa which currently taxes any annual earnings over £28,000 at 40%.
One Mauritian development, called Villa Valriche, is offering 288 villas overlooking the ocean and two golf courses in the Domaine de Bel Ombre region. Prices for the villas start at around £450,000 for a two-bed and cost £1m for the larger villas. Phase one of the development, consisting of 132 units, will be completed in 18 months time and is already sold out. Phase two is being released in May.
Until 2002, Mauritius did not allow foreign investors to buy property but the opening up of the property market to foreigners is part of the government’s plan to stimulate tourism and bring in foreign investment.
Investors with limited funds can make shared purchases where they are allocated a certain number of weeks in the year to use the villas as they wish, including renting them out.
Mauritius is expecting 980,000 tourists to arrive this year and the country estimates that it will have 2m annual visitors by 2015.
There is also no capital gains tax in the country.
House prices fall in South Africa for first time in 8 years
South African house prices fell in March for the first time in eight years, with the average house price down to R 550,000 (£35,300) from R 570,000 (£36,590) in February.
Standard Bank’s residential property gauge showed the decline reflected a year-on-year fall of -5.2% in the average price of residential property. The last time residential property prices fell was in June 2000 when they dropped by -2.5%.
However, the bank said the property market was simply correcting itself, but an economist at the bank reportedly admitted that there had been a substantial decline in demand for properties and monthly mortgage lending has halved from £2.57bn in June last year to £1.28bn in March 2007.
The bank reported: “The reduction in demand is due to a substantial reduction in affordability brought on by inflation, which is eroding household disposable incomes. Higher interest rates lead to higher installment payments and the fact that property prices have also gone up since 2004 has made residential property too expensive. Affordability seems to have deteriorated despite a declining interest rate environment between 2004 and 2006. In the short term it seems that property prices could continue to record low growth until the South African economy begins to improve again.”
