These are a few recent headlines and predictions about when the real estate market will bottom out. Of course, there are a select few who have been calling the bottom for some time now. Oddly enough, these tend to be real estate agents and newspaper columns. Speaking of newspaper columns, we are sad to see the end of “Raising the Roof,” the erstwhile International Herald Tribune and more recently, New York Times’ very own property blog. Kevin Brass will continue to write the print edition property column for the NYT, but the online version is no more. Honestly - this was one of the few international newspaper property blogs worth reading, and I don’t think I ever once saw a “We have reached bottom, Buy Now!” headline - which may be why it has gone the way of all things? Newspaper advertising is drying up faster than the 120% mortgages did.

Back to the meat of the matter:

House prices rise by 1.2%, says Nationwide. House prices staged a tentative recovery in May as the cost of the average British home unexpectedly rose by 1.2 per cent, in its strongest monthly gain for 19 months, according to figures from the Nationwide Building Society. The Times I wouldn’t get too excited about a UK recovery just yet - we have been watching median prices rise in a number of markets for the last two years as sales volumes dry up and the only stock moving is heavily discounted, more expensive properties. Eventually sellers drop their prices enough to sell in the lower end and median prices come into line with lower sales volumes.

Bernanke Bid to Lift Housing Scuttled by Rising Rates, Defaults. Federal Reserve Chairman Ben S. Bernanke’s efforts to bring down borrowing costs to revive the housing market and help the economy are stalling. Mortgage rates are almost back to where they were in March before the 30-year rate fell to a record and sparked a refinancing boom. Mortgage delinquencies rose to a record 9.12 percent of U.S. home loans and house prices dropped the most on record in the first quarter, industry reports show. Bloomberg. No great surprises here - if anyone seriously expected the low interest rates to be passed on to the end consumer, they need their head examined. 12% next year anyone?

Spanish newspaper, El Pais was calling the bottom of the Spanish property downturn just last week after a miniscule rise in the amount of mortgages written in Spain. Once again, nothing worth getting t0o excited about here. Move along, just another desperate attempt by a newspaper to halt the inevitable slide. On a year-to-year basis new mortgage approvals have fallen for 21 months without a break, and residential mortgage approvals in the first quarter of this year are 36% lower than the same period last year. The value of the average residential mortgage signed in March was down 16% to 119,067 Euros, 3.7% lower than in February, and interest rates are now up to 5.1%. Spanish property insight

Kuwait real estate prices decline 50%. Prices of real-estate properties namely the housing units have fallen by 50 percent, the Commerce Undersecretary announced on Monday. Rashid Al-Tabtabaei, in a statement to journalists after inaugurating the 22nd Real-Estate and Investment Fair, indicated the prices of properties vary from region to another with regard of the location of the plot, nature of the region and the services available. Economic sectors, namely the real-estate, the finance, the tourism and the oil, in Kuwait and other countries, have been affected with fallouts of the international financial crisis. Arab Times

Nicaragua Real Estate Sales Fall 35 Percent. Property sales in Nicaragua have fallen by up to 35% in the last year with second home investors deserting the emerging real estate market. The market peaked in early 2008, according to Brooke Rundle, a broker with Coldwell Banker Nicaragua. She estimated that the number of transactions has decreased 30 to 35% since. Nuwire. Turns out this is not actually the case because property sales in Nicaragua have been declining since 2006, which is not exactly a shock either - seeing as most buyers in Nicaragua are American real estate investors.

Both the recent S&P Case Schiller and Knight Frank global house price index show prices steadily falling in all but a few markets with no end in sight as yet. There are a few interesting properties bouncing around at the moment though - a British couple are selling their English Farmhouse - private plane included. Luxury property

If you are in the UAE and thinking of bailing out on Dubai, as thousands of ex-pats are doing daily- you better move fast, before the Dubai adopts a new rule that has just been implemented in Kuwait. A senior Ministry of Communications (MoC) official in Kuwait just has confirmed that the ministry is working closely with the Ministry of Interior (MoI) on a new plan compelling expatriate residents to pay any outstanding debts before they will be allowed to travel abroad.

Zakariya Mohammed Al-Ansari, the head of the ministry’s Accounting and Commercial Services Department, also flatly rejected the findings of a recent Audit Bureau report which accused the ministry of negligence in collecting debts owed by various corporate and domestic customers. The department head insisted that contrary to the report’s estimate of customers’ debts exceeding KD 120 million, in reality the sum doesn’t exceed KD 9 million.

Al-Ansari said that the department had collected KD 117 million in unpaid debts in 2008 alone, as well as collecting 98 percent of the amount owed to the ministry by local embassies. With the situation in Dubai worsening every day, the chances are they will also adopt this strategy.

You heard it here first.

On December 28th, The Kuwait Petroleum Corporation withdrew  from an agreement to create a $17bn petrochemical joint venture with Dow Chemical of the US. The move follows a reversal of approval from the country’s Supreme Petroleum Council. Kuwait’s state-owned energy group was to pay $9bn for half of Dow ’s basic chemicals business in a deal struck a year ago. On December 1 2008, KPC renegotiated the price downwards by $2bn.

Apparently Kuwait now needs that money to pump into their domestic housing market in a futile attempt to keep prices over-inflated. Good luck with that. A recent press release disguised as editorial was put out by the Kuwait government. Published in that paragon of news services - 24/7, an Arabian-based press release farm.

Real estate sector in Kuwait sees turnaround as sales volumes rise

reads the headline. The meat of the matter is a little different, with the article going on to point out that -

“A total of 515 transactions were registered at a value of KD136.6 million (Dh1.82 billion), while transactions rose 77 per cent month-on-month(MoM). Sales volumes rose 43.8 per cent MoM compared to a year ago, a report by National Bank of Kuwait said.”

“The bank said growth was led by the residential sector, which saw sales volume and the number of transactions surge by 100.7 per cent and 117 per cent, respectively, though apartment and commercial property sales were also up notably.”

But then going on to say -

“NBK reported that the first 11 months saw real estate sales fall by 34.7 per cent in sales volume and 34 per cent in number of transactions compared with the same period last year.

Most of the decline in sales occurred in the residential sector, where both sales volume and number of transactions saw a decline of 42 per cent.

Meanwhile, average transaction size for registered transactions during the 11 months fell by 23.8 per cent for apartments and commercial property and 0.3 per cent for residential property compared to same period last year.

According to NBK, Savings and Credit Bank (SCB) loans declined during November with the number and value of loans approved falling by 19.5 per cent and 16.7 per cent, respectively. SCB approved 404 loans in November versus a monthly average of 378 in 2007.

Compared with October, the number of loans approved for the purchase of existing homes rose by 19 per cent, while the construction of new homes and additions and renovations declined by 28.7 per cent and 22 per cent respectively.

Meanwhile, the value of loans disbursed rose by five per cent to KD13m, though loans disbursed thus far in 2008 are 20 per cent under amount disbursed during the same period last year.”

Source

Which hardly constitutes a turnaround. Sooner or later, the Emirates are going to have to start providing some transparency to their markets because no one is buying these sort of mis-informational releases any more. The World’s economy is in turmoil and Kuwait is no more immune to the downturn that any other country - WIth the possible exception of Monaco…….

Free missile launcher with every house purchase

I don’t mean the exocet missile sort of boom, I mean housing bubble boom. According to a well respected news source in the Middle East, 7days.ae, Iraq is on the verge of a property boom thanks to “short supply,” so it seems that if you want to start a housing boom, you need to bomb a few buildings. This is their report:

Iraq on the brink of property boom

Property prices in Baghdad’s residential districts have soared in the past year as security has improved, and estate agents say the trend is set to continue, given a serious shortage of homes.

“The price per square metre in the Zayuneh district has risen from $500 in 2005 to more than $1,000 today,” said Abu Abbas, owner of Zayuneh estate agency in an upmarket area of Baghdad on the east bank of the Tigris.

“Sellers have become even greedier since the ratification of the security agreement with the US,” he said, referring to the pact setting a timetable for US forces to leave Iraq by the end of 2011.

Although property prices are plunging in many other cities across the world amid the global economic crisis, the return of Iraqi refugees to Baghdad could unleash a ballooning of demand.

Several hundred thousand Iraqis are estimated to have fled since 2006 to escape vicious sectarian violence that erupted between members of the majority Shia community and Sunni Arabs in the aftermath of the 2003 invasion.

Most in demand are small properties and units of large converted houses, as potential buyers are mainly civil servants or people who work for foreign companies.

Baghdad has around one million homes for its seven million inhabitants - there are no exact figures - mostly individual homes as the city has relatively few apartment blocks.

Bayan Dazai, the housing and construction minister, estimates that Iraq will need 2.5 million new homes by 2015.

“We must build 200,000 homes a year and that can only be done by private investors,” the minister said.

Source.

And in case any of you missed the sarcasm here, when I say “well respected news source,” what I actually mean is “press release farm that does no research whatsoever and will print anything a developer sends them.”

And in case you think I am making fun of the rotten situation most Iraqis must find themselves in, I am not. I have argued against the war since it was first touted and the sooner we leave these people in peace the better. I think it is incredibly bad taste to push the idea of a housing boom in a war zone and the news source is a constant supply of disinformation and press releases written to confuse anyone as to the true nature of the markets - I wouldn’t trust a single word they write.