“Poland and the Czech Republic to emerge from recession in 2010”

New airport terminal set to transform south-central Bulgaria

Is the worst of the European property crash over?

Some US residential property prices may fall through to 2011

Price falls slowing in NZ residential property market

Value of South African residential property decreases the most in 23 years

“Poland and the Czech Republic to emerge from recession in 2010”

Capital Economics expects Poland and the Czech Republic to be among the first countries in Europe to emerge from recession, with a return to growth in 2010.

Kelvin Davidson, property economist for Capital Economics, said: “ Although that might appear to be a positive factor for commercial property in these markets, the fact that they are still substantially overvalued suggests that their property downturns have further to run than markets in Western Europe.”

Although the Polish economy has so far fared pretty well through the global downturn (being the only country in emerging Europe to record a year-on-year rise in gross domestic product in Q1), Capital Economics does not think this will last. Indeed, with the unemployment rate set to rise to around 12% on the Eurostat measure (about 15% on the local measure), real incomes will probably fall outright this year and private consumption growth will suffer. Capital Economics thinks Polish GDP will shrink by -1.5% in 2009 as a whole. The Czech Republic also has its problems and GDP could fall by -5% this year.

However, looking ahead, helped by a boost to the external sector from a weaker currency, Capital Economics believes that Polish GDP will rise by+1% next year, while Czech GDP could be up by +0.5%. Although these figures are still weak, they areboth stronger than Capital Economics’ expectation of zero growth in the euro-zone in 2010.

New airport terminal set to transform south-central Bulgaria

Plovdiv airport’s new terminal is poised to transform the region into a major tourist destination and substantially increase investment in south-central Bulgaria, according to Stroitelstvo Gradut (Construction and the City).

Investments poured into the facility’s overhaul and modernisation amount to 40 million leva, which are funds secured by the Ministry of Transportation and the chief airport operator, Letishte Plovdiv. Plovdiv Airport’s new terminal will commence regular operations from August 2009.

With the airport commencing operation in August, local authorities believe it will be a great stimuli for the local economy, investment and regional development. “The new cargo terminal concession, which is to be put in action, will have its positive impact over the local development and economy,” said Peter Mutafchiev, Transport Minister, quoted by Stroitelstvo Gradut.

Is the worst of the European property crash over?

The worst of the property crash in Europe could be over, according to Union Investment’s Climate Index, which is an index of attitudes towards property investment.

The index rose for the first time since autumn 2006 in France and the UK. The survey suggested this showed growing confidence among investors with regards to their own business prospects as well as the wider property market.

The UK saw a particularly steep rise in the index, by 12 points to 65.5. In Germany, the index remained the same at 62.1. In France, there was a slight increase of 1.8 points to 63.4.

The ‘expectation’ factor was the major driver for the positive performance of the index, particularly in the UK, where it climbed 19.6 points to 57.7. Around 63% of UK investors were upbeat about their prospects, but only 36% felt the same in Germany and 30% in France.

Some 87% of Brits expected a rise in investment from overseas in the UK market. A large number of investors were also returning to property as an investment class, the survey found. Some 42% planned to invest significantly more in property in the near future, compared to 21% in December 2008 in the UK. Both France and Germany also saw the percentage of people planning to invest rise, to 41% in both countries.

Around 68% of UK investors said they were focused on returns, with just 18% seeking safety. However in France and Germany only 28% and 29% were making decisions based on returns rather than safety.

Some US residential property prices may fall through to 2011

According to mortgage insurer PMI Group, residential property prices may fall in more than half of the largest US cities through to the first quarter of 2011 as unemployment and foreclosures rise.

Thirty of the 50 biggest metropolitan areas in the US have at least a 75% chance of lower prices through to March 2011. The decline is likely to spread to ‘all regions of the nation’ from California, Florida, Nevada and Arizona, the states most affected by the housing slump.

Unemployment rose to 9.5% in June, bringing the total number of jobs lost to 6.5 million since December 2007, according to the Labor Department. Real estate data service RealtyTrac Inc believes that foreclosure filings may hit a record 1.8 million in the first half of the year as more jobless homeowners default on their loans.

Home prices in 20 major US metropolitan areas dropped -18.1% in April from a year earlier, following an -18.7% in March, according to the S&P/Case-Shiller index. Prices are forecast to fall -41.7% from their peak, according to Deutsche Bank AG analysts.

Price falls slowing in NZ residential property market

According to the latest QV Valuations report, residential property values in New Zealand fell -7.1% in June compared with -8.1% in May and -9.2% in April.

The national average house sale price has now increased to $378,535 in June from $371,555 in May. Sales volumes are now approaching more normal levels and an increase in the number of people intending to buy alongside a decrease in the number planning to sell could lead to a shortage of properties and more competition among buyers, according to the QV report.

In the Auckland region, the annual decline has improved to -5.9% in June from -7.6% in May. The average sale price has increased from $483,397 to $489,444. Elsewhere in the country Hamilton values improved to a -6.6% fall compared with -7.5% in May, Tauranga improved to -8% compared with -9.4% in May, Wellington improved to a -6.5% fall compared with -7.4%, Christchurch fell -7.3% from -8.1% and Dunedin was down -4.5% compared with May’s decline of -5.4%.

Value of South African residential property decreases the most in 23 years

South African house prices fell the most in 23 years in June, dropping -4.4% from 12 months earlier, according to Absa Group Ltd, the country’s biggest mortgage lender.

The average nominal house price dropped to 924,600 rand as prices fell -0.5% in the month, according to ABSA.

South Africa is in its first recession in 17 years, pushing up unemployment, slowing consumer spending and depressing house prices.

The Reserve Bank has cut its benchmark interest rate five times since December, dropping it to 7.5%, to help revive the economy.