GLOBAL PROPERTY MARKET FORECAST 2014

Developed Nations in Favour

Sometimes the global property market resembles Alice in Wonderland. Only the unexpected can be expected with certainty. Look back at forecasts for 2013 and we can see how difficult it is to predict what might happen in 2014. For example, highly respected economists said British property values would drop 2 per cent last year. In reality, they rose 7 per cent. Continued high levels of foreign investment in London, the introduction of Government subsidies for home-buyers in its Help-to-Buy scheme and a stronger-than-forecast economic recovery were unexpected events that helped lift British home prices.

Whilst calculating accurate property price rises can be problematic, some broad-brush trends are easier to forecast. East Asian governments, like Singapore, implemented measures to cool their overheating property markets in 2013, and they can be expected to try and keep a lid on prices again in 2014. This means values could fall by as much as 15 per cent in Hong Kong and rise modestly at best in China property consultancy, Knight Frank, forecasts. In the BRIC cities of Moscow, Mumbai, Hong Kong and Shanghai investment returns will be low in 2014, because of deteriorating market conditions forecasts property consultancy, Savills.

Bric buyers busy

With their home countries increasingly less favourable for investment, growing numbers of Russians, Chinese and Indians will buy properties elsewhere in 2014. According to Savills, Chinese investment overseas will grow by at least 20 per cent per year over the next decade, a reflection of their increasing wealth. Middle Eastern investment abroad is likely to grow in 2014, as business people seek to avoid conflict zones within their region and others look to re-invest oil and gas profits in international property markets.

Keen to attract Asian and Russian investors are many western countries, whose governments want to stoke up activity in housing markets to fuel faltering economies. Spain and Greece joined Portugal, Ireland and Cyprus in offering residency to overseas investors in 2013, and if the initial rise in buyer enquiries is a guide, this ought to result in increased property sales in 2014.

Small hints of a turnaround in the holiday home markets of battered southern European property markets were recorded in late 2013, with prices rising in Spain's Balearic islands, for example. An influx of wealthy overseas buyers may help to stabilise luxury home prices in Europe's Mediterranean markets in 2014. In Paris, the outflow of wealthy French seeking tax exile abroad is likely to be balanced by an inflow of wealthy foreigners taking advantage of price cuts to purchase trophy homes in this architectural oasis.

eurozone monster

But the Jabberwock, a monster that terrorised characters in Alice's Wonderland, has a European, real-life equivalent – the unresolved eurozone crisis. Continued fear of possible economic collapse among Europeans will suppress home-buying activity within the eurozone, counteracting increased investment by foreigners. The European Central Bank has pumped money into the region's financial system to ensure banks don't go bust and loaned money to individual countries like Greece, but the debt mountains remain, unemployment is high and strong economic growth a distant memory. 

In some respects, eurozone members resemble chaotic characters at the Mad Hatters Tea Party, because some countries, like Portugal, are cutting property taxes to attract investment and then contradicting those moves by raising other property taxes to fund debt repayments, or even, as is the case with Italy, introducing additional property taxes in 2013 and then considering whether to abolish them in 2014 for the same reasons.

Britain "too strong?"

In Britain, estate agents fret that politicians' talk about the imposition of a possible “mansion tax” is deterring foreign buyers. Prices in central London, where foreign buyers are most active, slipped 2 per cent in the final months of last year. However, the capital's record high prices are likely to be a bigger issue for buyers, and this could lead to a slow down in the number of sales made in 2014.

Outside of London, property prices are likely to strengthen as more Britons enter the housing market this year. And yet, Savills warns that Britain's housing market may fall victim to the country's economic success in 2014 if the Pound strengthens on international exchanges, because that might make its bricks and mortar prohibitively expensive for overseas investors.

Tax havens boom

Some Caribbean tax havens have extended residency schemes to attract more High Networth Individuals to their shores, and this could lead to increased property sales in 2014. For example, Barbados introduced Special Entry and Reside Permits last September which allow wealthy individuals to come and go from the island as they please.

The Caribbean's emerging rivals for beach-combing tax exiles, the Indian Ocean nations of Seychelles, Maldives and Mauritius, will continue to grow in our collective consciousness during 2014, as more luxurious resort communities are built on their sandy sea shores.

Key hotspots 

The United States housing market resembles a patchwork quilt. At one extreme, property prices in Manhattan are above their 2007 peak, while at the other end, the bankrupt city Detroit is having much of its housing razed to the ground as inhabitants leave to start new lives in towns and cities with brighter economic futures. Perhaps the US city to watch in 2014 is Miami where Savills says prices for luxury condos are within a whisker of their 2007 peak following an influx of South American second home buyers over the past couple of years.

Other cities around the world that might attract growing numbers of homebuyers in 2014 are Tokyo, Dubai and Hamburg. Tokyo may be ripe for investment, because the city's capital values and rental returns are rising. Dubai's property market, which temporarily topped some international indices for price growth in 2013, will continue to perform strongly in 2014, as its economy bounds forward.

Few international property buyers considered Hamburg in the past, but that is changing. “International standard” housing projects in Germany's largest port city are being marketed to overseas buyers for the first time, including the water-front, Sophienterrassen project where developer Frankonia, is building 191 homes with Karl Lagerfeld-designed communal areas.

Brands popular

Operating at the top end of the housing market Frankonia is a well-known brand in Germany. Increasingly, when buying newly-built properties overseas, home-buyers want to purchase from reputable brands, because they feel more confident about how the development will turn out. The services and facilities available to residents at branded schemes, including gyms and home cleaning, appeal too. With growing numbers of developments branded and serviced by top hotel chains like the Mandarin Oriental, their popularity is likely to grow stronger in 2014.

Lastly, a look at an overhyped housing market - Rio. Estate agents say hosting the FIFA World Cup 2014 and Olympic Games 2016 will result in increased international attention which will boost sales of homes to foreigners. However, the chaotic organisation of these sporting events, street riots and high levels of crime are generating the kind of publicity that most estate agents could do without. Also, much of the promised new infrastructure will not be completed. 

If the property market still appears a bit bewildering in 2014, consider the Cheshire Cat's advice to Alice: “You just go where your high-top sneakers sneak, and don't forget to use your head.” 

MALDIVES HOLIDAY HOMES FOR SALE

Sonu Shivdasani is the first resort operator to sell holiday homes in the Maldives since the archipelago's government gave permission for this in 2010. 

Located at his Soneva Fushi resort on the island of Kunfunadhoo, a 35 minute seaplane-ride away from the capital, Male, the villas look out over the turquoise waters of the Indian Ocean.

Shivdasani has sold eight villas, mainly to Europeans, since marketing began in 2011. A total of 16 private residences are on sale through agents, Savills, at prices starting from GBP3 million for a three bedroom home with 20 metres of beach frontage. Built from wood and thatch, each villa can be altered in consultation with the architects, and has its own swimming pool. Construction of each villa starts when a buyer's offer is accepted, and takes about eight months.

Barefoot millionaires

The resort operator says there will be a maximum of 65 villas. At least one-third of the island, which is 1.4 kilometres long and 400 meters wide, will remain undeveloped jungle, he promises.

Leases for villas are only 50 years, but can be renewed on expiry. Buyers can look forward to annual returns of 4 to 5 per cent if they place their properties in the rental pool says Shivdasani who is chief executive officer of the Soneva Group.

Although gourmet dinners and fine wine tasting is available, life at the resort is mainly about walking around barefoot and enjoying the sea and beach.

“We offer intelligent luxury,” says Shivdasani, “we offer unique experiences, things that people can't do in London or New York, such as dolphin cruises and having an overnight stay in a tent on a sandbank.”

Forty-six treatments are available at the resort spa.

Private islands

Owning your own private island in the Maldives is possible. Many of the 1200 islands in the Maldives are available for sale for private use. They include Kendhivaru, a 17 hectare private island in the Noonu Atoll, which is on offer for GBP2.5 million through real estate web site, Private Islands Online. It has a new, five bedroom, five bathroom bungalow and separate staff quarters, plus two generators, desalination plant and fruit and vegetable garden. The owner will sell for GBP1.9 million if the buyer is a resort developer who agrees to share future proceeds.

Floating homes

Prospective holiday home buyers concerned about the possibility of rising sea levels brought about by climate change can purchase a property that floats. Dutch Docklands, a Netherlands headquartered developer of floating structures, is building five “lagoons” that will be anchored to the seabed in the North Male Atoll and which will rise with sea levels. More than 700 homes for sale will be built on these lagoons.

The lagoons include Ocean Flower, a flower-shaped quay that will provide access to 185 water villas situated over the sea. Starting prices for villas which will have two, three or four bedrooms, start from GBP1 million. Scheduled for completion in 2014, the villas are on offer through sales agents, Christies International Real Estate, which is also marketing Amillarah, an archipelago of 43 floating private islands, the scheme's second “lagoon”. Depending on client specifications, prices for these private islands start from GBP6.3 million.

Other lagoons include the world's first floating 18-hole golf course, which will have villas overlooking the greens, and Greenstar, a floating star-shaped hotel, shopping mall and convention centre. Plans for a Venice-inspired floating village with townhouses completes the project.

HOW TO FORECAST PROPERTY PRICE RISES

Follow the agents who follow the money

Want to know where property prices will rise next? Follow this blog's Property Hotspotter column which tracks estate agency branch openings. This shows where property markets are hot or heating up. 

Estate agents open or expand operations in an area when their research shows transaction levels are rising. When buyer demand goes up, prices usually do too. 

Here's proof that Property Hotspotter works. In August 2012, this blog showed four agencies had expanded in six UK districts. One year later, prices have risen in each district by the following amounts:

Henley  +7 per cent

South Kensington  +8 per cent

Central Kensington  +7.4 per cent

Stockwell  +3 per cent

Tooting  +7 per cent

Mitcham  +4 per cent

(source: zoopla)

See my Financial Times article on where and why agents expand by clicking on this link http://www.ft.com/cms/s/2/28b251d0-428d-11e1-93ea-00144feab49a.html#axzz1rARj2Xfz

Here are estate agency openings for summer 2013 -

Notting Hill – Chesterton Humberts

Greenwich – Winkworth

St Albans - Winkworth

Bangalore, India – Winkworth (Franchises in New Delhi and Chennai to follow later in 2013)

Belgravia, Pimlico, Westminster, Knightsbridge (lettings) – Belvoir (purchased lettings agency, Soames)

Shropshire (lettings) – Belvoir Telford (purchased managed portfolio)

Suffolk (lettings) – Belvoir Ipswich (purchased lettings agency, Prime Residential)

If you want to add any branch openings/expansions to this list please add them to the comments section or tweet me @richardgwarren or email me at richard.warren@rocketmail.com

BRITISH PROPERTY BOOM STARTS

Where will house prices rise?

You read it here first. Britain is about to have a property boom. 

British homeowners will owe their good fortune to the “ripple affect”, a phenomenon that has characterised every modern British housing boom. 

The ripple affect works like this, property prices rise in London, then spread out across the rest of the country, region by region, moving north and west, until finally everyone agrees “there's nowt like bricks and mortar as a good investment”. We are at an early point in the process with price rises rippling out of the British capital into parts of south-east England. One or two markets further afield are also looking busy. 


London leads the way

So, here's a snapshot of where we are at now. Property prices in the most desirable parts of London, like Kensington and Chelsea, are 10 per cent above what they were in early 2008, at the height of the previous housing market cycle prior to its collapse later that year, figures from website zoopla show. Property prices for most of the rest of London are close to parity with 2008 levels. 

Across Britain as a whole however, prices remain 8 per cent below peak levels even when the London price surge is added, which goes to show how depressed most of the rest of the country's housing market remains. In northern English cities like Bradford, home prices are 15 per cent below where they were five years ago.

But, in south east England, housing markets in prosperous towns and cities have been recording small property price rises for one or two years. Slightly further afield, in some West Country and East Anglia locations, property transactions and prices are increasing, positive evidence that the ripple affect is strengthening. It has been felt most strongly in the West Country city of Bath where prices have jumped 7 per cent over the past 12 months.

Ironically, the cause of the ripple affect are those high property values in the capital. When Londoners find they can no longer afford to buy or rent a home in their city, they look further afield, and they are doing so in ever greater numbers. Estate agency, Knight Frank, says most demand for homes in cities like Bath, Oxford and Guildford comes from priced-out Londoners.


Overseas buyers impact

Overseas buyers, the biggest group of purchasers of multi-million pound homes in central London, have been making their presence felt in the capital's hinterland over the past year, especially in the exclusive, private housing estates of Surrey and Berkshire where they can get more for their money than in Mayfair or Knightsbridge. 

Individual British homeowners are knocking down their own homes to build “palaces” for Russians, Kazaks and Arabs. At Weybridge, Surrey, a former Rolls Royce executive has replaced his 100-year old home with Newnham, a house two-and-a-half times the size, complete with swimming pool, massage room and the large entertaining spaces sought by Russian oligarchs. He wants GBP14 million for it.


Better economy, better colleges, better transport help

Some businesses are escaping London's high office costs for outlying locations and this gives added momentum to the ripple affect, because employers and staff relocate with them. Brighton has 1,000 digital and technology businesses operating there, some of them former London operations, and this is contributing to its population and property values growing faster than the national average.

Improving transport links is giving a boost to some housing markets. Property prices have been rising in Bristol and Cardiff since plans were announced last autumn to electrify rail links between these two cities and London. The improvements will reduce train journey times between Bristol and the British capital by 20 minutes. Knight Frank estimates electrification will add up to 10 per cent to the value of homes in parts of Bristol.

The expansion of world class education facilities, including universities, independent schools, language colleges, teaching hospitals and further education colleges in cities like Oxford and Cambridge, and their ever closer links to private enterprise, is generating increased demand for homes from burgeoning numbers of students, teachers, lecturers, businessmen and scientists. 

The development of research facilities at Cambridge University has made “Silicon Fen”, the science parks outside Cambridge, an international hub for software developers, biotechnologists and electronics specialists. 

Oxford University's biggest construction project for more than a century, the 10-acre Radcliffe Observatory Quarter, will add 7 per cent to the value of homes surrounding it Knight Frank forecasts. Nearly completed, it consists of libraries, teaching premises, student accommodation and medical facilities.

A farming revival in some locations is having a positive impact on housing markets in smaller market towns, including Marlborough in Wiltshire. Businessmen have bought up tracts of countryside surrounding the town, increased farm productivity and launched new enterprises, like brewing. These activities combined with an expansion of the town's world-famous independent school, Marlborough College, have created jobs, drawn visitors and increased trade between businesses, underpinning demand for homes there.


Southern construction boom

Construction levels may be depressed nationally, but in London and much of southern England they are rising as house-builders compete to accommodate incomers. Bath is experiencing its greatest level of building activity since post-war reconstruction in the late 1940s. New schemes include Somerset Place, where Regency houses lining one of the city's five famous crescent-shaped roads are being restored by developer, SIAHAF. Used by a university since World War Two, the yellow Bath-stone buildings are being turned back into homes - nine houses and 20 apartments, with prices starting at GBP1.65 million. Six new houses are being constructed behind the crescent.

To the north, Edinburgh homes are rising in value, even though most of the rest of Scotland remains mired in slump. As Britain's second largest financial centre, Edinburgh's economic fortunes can more closely mirror that of London than of other Scottish cities, and this is reflected in its housing market trends.

Locations to watch in the English north and Midlands include Wilmslow in Cheshire, famous for all its millionaire footballer residents, and Stratford-upon-Avon, Shakespeare's birthplace in Warwickshire, which is attracting overseas buyers. Upmarket estate agency, Sotheby's International Realty, has expanded its operations in both locations to cater for increased buyer demand.

A housing market needs a strong economy to underpin it. With a double dip recession avoided, GDP growth forecast to accelerate over the next two years, and employment levels rising, Britons are starting to think it is safe to buy a home again. This ought to ensure price rises ripple out further from London.


Help to buy

The ripple affect will be given extra momentum by the Government's Help-to-Buy scheme announced in March which targets homes valued under GBP600,000. It will provide buyers with equity and loan guarantees equal to up to 40 per cent of the value of a property, thereby alleviating the difficulty many have with raising the large deposits demanded by banks. Mortgage lenders have been getting busier since the scheme was announced. Nationwide Building Society says mortgage demand from first time buyers has increased 70 per cent year-on-year.

The extent to which this embryonic housing boom is sustainable will depend on the balance between sound economic and demographic fundamentals on the one hand and government intervention on the other. Where Help-to-Buy is a dominant driving force, price rises will not be sustainable in the longer term, because they rely on buyers taking on large debts, but where improved transport links, economic recovery and growing population underpin demand, they ought to be. The towns and cities mentioned in this article fall into the latter category.   

(This is a version of my article which appeared in Identity magazine, UAE)

NEW MARRAKECH HOLIDAY HOMES

Most Riads Redeveloped

Entering La Villa des Orangers was like being told a secret. Here a visitor can discover the type of tranquility usually only found in churches, temples and places of exquisite natural beauty. 

Walk through a quiet, high ceilinged corridor lit by lanterns and into an inner courtyard where, in the middle surrounded by four orange trees, an ornate stone fountain burbled gently. The sweet smell of incense wafted across from an alcove where lantern light illuminated the blue and white mosaic ties decorating floors and walls. Above, galleries overlooked the courtyard on four sides. 

Through another corridor into a second, bigger inner courtyard which had a shaded seating area at one end and swimming pool at the other, with exotic, flowering plants, including more orange trees, occupying most of the rest of the space. This lantern-lit courtyard was also overlooked by first floor galleries, and everything, water, leaves and air was still. It could have been a Moroccan-style setting for a performance of Midsummers Night Dream.

La Villa des Orangers is a boutique hotel, but the type of building it occupies is known as a riad, a traditional Moroccan-style house, the must-have abode for adventurous Europeans in north Africa during the early noughties when many of these largely unmodernised properties were on the market at remarkably low prices, only GBP40,000 in some cases. Set around one or two inner courtyards these two storey houses are unusual in that they are largely windowless on the outside, providing occupants with a high level of privacy and protection from noise. 

The largest Marrakech riads are palatial and rarely come onto the market these days. Developers have been restoring them, converting some into hotels and restaurants, and selling others as upmarket homes. With most Marrakech riads now restored and occupied, many developers are turning their attention to building villas on the outskirts of the city where a very different lifestyle is offered to residents.

Modern Suburban Villas Popular

New suburban villas include Dar Tourtelle, a three bedroom home situated in the Ourika Valley to the south of Marrakech at the foot of the snow-covered Atlas Mountains which can be seen from the property, as can the surprisingly green surrounding countryside which is filled with trees – palm, olive, cypress and eucalyptus. 

On offer for GBP650,000, this home is in the Bab Adrar development where Moroccan architect, Karim el Achak, has designed eight villas, each with a different floorplate to the others. The architecture blends traditional Marrakech style, such as building with red clay, with European comfort, including 3.5 meter-high ceilings which are for good air circulation, a concept French colonials introduced to Morocco during the early twentieth century. 

With daytime temperatures ranging from between 20 degrees centigrade in winter to 45 degrees centigrade in summer, the villa has plenty of shaded, outdoor spaces, including a roof terrace and garden terrace. 

The development has a communal tennis court and hamman. Its developer is British entrepreneur, Tim Buxton, who started out restoring riads at the start of the last decade before moving into building villas.

“The riad market ended in 2005, following a tripling or even quadrupling of prices,” says Buxton, “Now it is all about villa construction and the development of resort communities outside Marrakech.”

He says suburban villas appeal to homebuyers who want to escape the hustle and bustle of the medina. Outdoor pursuits, such as walking and skiing in the Atlas Mountains, can be pursued more easily from villas on the south side of the city too.

Many villa buyers are former holiday-makers who rent a property one or two times and then decide they want a house of their own says Alicia Pasley-Tyler, international lettings negotiator at Aylesford estate agents which is marketing homes at the Bab Adrar development.

Aylesfords is marketing homes for sale at Assoufid, one of the large resort communities under construction on the outskirts of Marrakech and which also has views of the Atlas Mountains. Project developer, Assoufid Properties Development, is planning to build 80 villas at this 222 hectare golfing community. Initially, 14 villas are being offered for sale, six of which have found buyers. 

The project was first launched in 2006, but construction work was put on hold in 2010 following the credit crunch. Work restarted in 2012 after Kuwaiti investors agreed to help bankroll the scheme. However, timing of the final completion date will depend on how quickly villas are sold. Construction of the resort's hotel will start later this year the developer says. The 18-hole golf course and four villas have been completed so far.

Villas at Assoufid are huge. The Art Deco-inspired show house has 500 square meters of indoor space and 500 square metres of covered terraces, including a massive, shaded roof terrace with 360 degree views. Each house has a garden, swimming pool, pool house, garages and staff accommodation set in one hectare of its own grounds. Prices start from euro1.95 million for a three bedroom villa with an internal area of 552 square metres to euro2.95 million for the show house which has four bedrooms and an additional two bedroom guest pavilion.

Marrakech Property Prices Crashed

The second homes market in Marrakech has struggled since it peaked in 2006, because of the global economic downturn and fears over the extent to which Arab Spring-related violence might afflict Morocco. Prices have fallen for all types of Marrakech property over the past six years, down 20 per cent for villas, 40-50 per cent for apartments and 30 per cent for riads, says Buxton. Some developments appear to have been shelved. A resort community scheduled for completion in 2012 by Monaco's state-owned SBM corporation remains on the planning board. The company has not responded to our questions about its future.

Although Morocco has been rocked by occasional bomb attacks made by Western Sahara separatists and witnessed some street protests against corruption, unemployment and other issues, the country has remained stable since the Arab Spring began in 2011, and Buxton believes the Marrakech housing market is starting to recover, partly helped by French buyers wanting to escape the eurozone crisis and tax rises imposed by President Hollande.

“We will have low price growth in 2013 and this will accelerate in 2014, because the French are coming back,” says Buxton, “The French like Morocco, because don't need a passport to get in, only an ID card, and because of the language.”

Growing Expat Community

The British are arriving. At the Bab Adrar project, five villas have been bought by Britons and one by a French family since sales began. Rich Moroccans from Casablanca, the country's main commercial centre, are buying weekend retreats around Marrakech. Swiss second home buyers are arriving, their language skills ensuring they are able and willing to negotiate deals in Francophone Morocco.

Many overseas home buyers are looking to retire in Morocco, attracted by its low taxes, including an absence of inheritance tax on property, says Buxton.

Most villas on the market in Marrakech mix traditional with modern in their design, such as a suburban, four bedroom villa in the Agdal district of the city on offer through Savills for euro2 million. Christies International Real Estate is marketing a three bedroom villa located within the Palmeraie, a district of dry palm groves. The Modernist-style, euro3 million home has gardens, a swimming pool, jacuzzi with views of surrounding palm groves, and terraces with views of the Atlas mountains. 

Re-sale properties available at resort communities include a three bedroom villa at the Four Seasons resort, 1.5 kilometres from the medina, on offer through Knight Frank at euro1.25 million. 

(This is a version of my article which appeared in Identity magazine, UAE)

PROPERTY HOTSPOTTER - DECEMBER

Follow the agents who follow the money

Who opened or expanded branches in November/October/December

Central London – CBRE has acquired London estate agency, E.A. Shaw

UK - Countrywide has acquired 23 lettings offices in past 18 months

Ealing (London) - Benham & Reeves Residential Lettings

West Hampstead (London) - Kinleigh Folkard & Hayward has opened a lettings branch
London - Hamptons International has opened a lettings department in Hong Kong for owners of London property.

London - Chesterton Humberts has launched a home-finding service

Liguria (Italian Riviera) - Chesterton Humberts


PROPERTY HOTSPOTTER is updated monthly (except in summer). It lists which estate agents opened or expanded branches, or formed new affiliations, in the previous month.


Estate agents open or expand operations in an area when their research shows demand is rising, so this can indicate a future property hotspot.

See my Financial Times article on where and why agents expand by clicking on this link http://www.ft.com/cms/s/2/28b251d0-428d-11e1-93ea-00144feab49a.html#axzz1rARj2Xfz

If you want to add any branch openings/expansions to this list please add them to the comments section or tweet me @richardgwarren or email me at richard.warren@rocketmail.com

FUTURE CITIES: WHAT WILL THEY REALLY BE LIKE?

Taller, greener, smarter and home-based

Artists' impressions of tomorrow's urban utopias usually depict cities of giant towers, some bulbous or twisting, others connected by walkways in the sky and buzzed by flying cars. The reality could be more practical, liveable and equally imaginative.

Significantly, we, the people, may have a bigger say in how our cities evolve. The BMW Guggenheim Lab, a collaboration between the car-maker and art museum, is an ideas forum for urban design which is holding a rolling programme of talks in cities around the world. Discussions held at its first stop, New York, suggest future cities will be shaped increasingly at grass-roots level by ordinary citizens says Thomas Girst, BMW Group spokesman. “Small urban experiments initiated from a culture of participation, crowd sourcing, community cohesiveness... will inspire larger, city and region-wide efforts aimed at urban improvement,” says Girst.

Despite the Lab's initial findings, planning professionals dominate thinking for now, and 'Place-making' is one of their favourite buzzwords. Instead of dividing a city into distinct residential, retail, office and industrial zones, the idea is for districts to become a mix of these elements, so it is alive all hours of the day, and enables people to live close to their work places, shops and leisure facilities, saving them time and money on travel. Early examples include the City of London which, in addition to being Europe's key financial district, is now a prime residential area, because it has changed from being a place where hardly anybody lived to become home to 9,000 people, many of them residing in new, luxury apartment blocks, such as The Heron.

The future city will be high tech. Companies like Siemans, Philips and Cisco Systems promote 'smart cities' where technological innovations like wireless sensor networks will be installed by authorities to manage resources better, such as dimming and brightening street lighting depending on when it is needed most. Jeroen Beekmans, partner at Golfstromen, a creative agency based in Amsterdam, works with Phillips to explore how intelligent technologies, such as Internet accessing smart-phones, can shape cities. He believes citizens may manage public functions like street lighting in future. “Now we all have a smartphone, but in ten years we might wear innovative glasses that turn the city into an operating system,” he says.

Another technological development to watch is 3-D printing. Using blueprints stored on the Internet, 3-D printers can print out objects like chairs and door knobs using plastic or metal powder as 'ink'. Scientists are looking to bring down costs so we can have 3-D printers at home to print out smaller objects, and machines in high street premises to produce larger pieces. If realised, this technology will speed up the demise of traditional retailing which has been battered by on-line shopping, leading to fewer shops on our high streets. We may also see buildings constructed with 3-D printers. Loughborough University has developed a machine to print out wall sections with cavities for cabling. If the machine becomes commercially viable, then construction of buildings will become faster, because developers can install 3-D printed sections, rather than fabricate walls on site.

The Internet is enabling more people to work from home, so companies will need fewer offices in future, which means fewer and smaller office districts. In place of offices we have work hubs appearing in suburban and central city districts to accommodate home workers who want to work outside of the house part of the week, mainly so they can enjoy human company. Operating like gyms, these hubs have desks, phones, printers and even cafes and libraries for users who pay monthly membership charges. More people working from home means fewer people commuting, so the relentless expansion of roads and commuter railways could ease up in many cities, possibly stop and even go into reverse, assisting another trend, pedestrianisation.

On New York's Manhattan Island, a three kilometre long stretch of overhead railway has been closed and turned into The High Line Park pedestrian walkway. In central London, Braham Street, a previously busy four lane road, has become Braham Park, a quiet, green oasis. London is following the example of the Netherlands by turning some roads, like Exhibition Road in Kensington, into shared spaces that cars and pedestrians both use. It slows down traffic and is safe, but irritates drivers, because they have to negotiate pedestrians in their path, leading some of them to leave the car at home.

Reducing traffic in cities is part of a wider drive to make them Greener, so too are low carbon building projects which are appearing in greater numbers. In Helsinki, British engineers and designers, Arup, leads an international team master-planning a Dhs272million low carbon housing, office and retail complex called Low2No on behalf of Finnish development partners Sitra, SRV and VVO. Intended to be a role model for other low CO2 schemes, the 22,000 square meter project will have energy efficient buildings made from sustainable materials like wood and an off-site wind farm to offset carbon emissions.

Some new eco-districts are being named after the company that builds them, so we may expect some future urban landscapes to become branded products just like groceries. For example, Masdar City in the UAE is named after Masdar, a renewable energy subsidiary of the Abu Dhabi government-owned Mubadala Development Company. When fully complete in 2025 the city will be home to 40,000 people and a showcase for renewable energy and clean industries developed by the company's recently built Masdar Institute of Science and Technology.

London studio, Foster + Partners, is designing Masdar City to be energy efficient. Buildings are being constructed close to each other to create wind canyons and to ensure the sun only shines for one hour a day in these narrow pedestrian corridors, a passive cooling system for buildings and pedestrians that reduces the need for active cooling systems like air conditioning. This design follows the pattern of traditional Arab cities which maximised shady areas. This means future cities may provide opportunities for design ideas from the past to make a come back.

However, not all schemes come to fruition. In China, developer SIIC had plans to build Dongtan, an eco-city near Shanghai. The first phase was scheduled for completion in 2010, but it remains un-built and so does the remainder of the city which was intended to become home for 500,000 people. Arup master-planned this city, but implementation has been postponed indefinitely by the developer with no explanation given.

Unrealised dreams like Dongtan have led some architects like Austin Williams, director of the Future Cities Project, to argue that the current emphasis on sustainability and low impact architecture has resulted in poor quality design and urban planning.

Usually, we think of cities getting bigger, but some could shrink. Some already are. In the US city of Detroit, 12,000 homes have been abandoned by people escaping economic decline for better times elsewhere. Those houses that don't fall down are knocked down. Civic authorities are attempting to consolidate who and what is left behind into a smaller, manageable unit, so homes are no longer separated by acres of “urban prairie” as exists in some parts of the city now.

Of course, the Detroit authorities might want to consider taking advantage of this enforced ruralisation to adopt the Roman principle of rus in urbe, of deliberately bringing the countryside into the city to make it a greener, healthier place. This principle exists in the British city of Bath where sheep graze in parks within the city centre, and in the London suburb of Richmond which has a dairy farm open to the public. Cowboys in Detroit? It may happen.