URUGUAY'S CELEBRITY UTOPIA

The rule of thumb is that good transport connections boost property markets. In Uruguay we can find the exception to this rule. Here, a seaside resort called Punta del Este has become the darling of international celebrities, despite, or because of, its inaccessibility to much of the rest of the world.

Punta is a sprawling resort community on Uruguay's eastern coast, dubbed by its fans “the St Tropez of South America”. During the peak season, from December to February – the South American summer – the town's population swells twelve-fold from 30,000 to 380,000, made up mostly of Brazilian and Argentine holidaymakers.

Punta's remoteness may put off many would-be second home buyers and investors from outside South America. The town's airport only serves nearby South American destinations, while the airport at Uruguay's capital, Montevideo, is two hours away by road. What's more, it receives few direct flights from outside Spain and the Americas.

However, celebrities love it. They won't find many paparazzi or stalkers down here, because it is too far for them to go. Michael Caine, Ralph Lauren, Naomi Campbell, French footballing legend, Zinedine Zidane, and Viscount Portman, owner of London's Portman Square, are famous names from the northern hemisphere who visit regularly. Martin Amos, Shakira and Eva Herzigova own holiday homes in Punta. Argentina's high society takes up residence during the summer when Punta becomes one of the world's top party destinations on New Years Eve.

“Huge numbers of people vacation there during their summer,” says John Hitchcox, chairman of designer developer YOO, “It is very chic, very elegant. In peak season it is wall-to-wall mercedes. Everyone who is anyone is there.”

The coastline has become a showcase for modernist architecture. Buyers buy plots of land and then hire architects to design holiday villas for them - these come in a breathtaking variety of shapes, sizes, and materials, that demonstrate the versatility of this architectural style. Sprinkled among them are nineteenth century thatched houses and the occasional flight of fancy, including a mansion designed to resemble a Moorish castle.

This has all meant that Punta has grown from a small community centred around a lighthouses at the tip of the point which sticks out to sea, to a resort community that stretches 20 miles up the coast. The town centre is dominated by apartment blocks.

Punta's popularity with big spending socialites and celebrities is attracting upmarket international estate agents like Christies and Sothebys, and developers of designer homes. New arrivals include Obsidian, a British developer which is building 13 detached modernist villas on its 90 hectare Villalagos estate close La Barra, a fashionable district of Punta. Michael Caine's daughter, Natasha Caine, is interior designing the homes which are targeted at the crème de la crème of Punta high society. Prices start at a little under $2 million.

In the heart of Punta, YOO and Miami-based developer, K-Group Holdings, are refurbishing a 22-storey apartment building. YOO's creative director, Philippe Starck, has given the interiors his trademark style - contemporary, glamorous, slightly Alice in Wonderland – chandeliers hang in communal parts, including the outdoor swimming pool area, and beds in its $300,000 apartments have giant, antique picture frames as faux-headboards.

Most buyers here and elsewhere in Punta are Brazillian, Argentine and Uruguayan. Aside from the occasional celebrity, buyers from other continents in Punta tend to be wealthy individuals who own pads in all the usual places like London, New York, the Alps, Phuket, French Riviera, and so want something new and exotic to add to their portfolio.

As Brendan Baury, Obsidian's development director at Villalagos, says “they are international businessmen who are looking for their fourth and fifth or more holiday home.” He believes Punta has great investment potential, adding that although mostly empty for much of the year, weekly rents of $100,000 are charged for some of the better homes in peak season he says.

Less expensive homes are available for purchase. Most modern two and three bedoom apartments tend to be around $160,000 and houses can be relatively inexpensive.

Punta may be a long way away, but as Michael Caine and company have shown it is a place that draws the rich and famous back year after year. Maybe, exactly because it is so far away.

(All The World's a Home : Global Property News)

A TALE OF TWO MARKETS

Two property markets are emerging in Britain. Prime central London is looking increasingly buoyant, but most of the rest of the UK is troubled. Let's see why they differ.

First, the whole of the UK - the basic problem of the banks not lending still remains. In addition to that, unemployment is rising, tax rises are on the way and big public sector cuts are in the offing, and all the industrial relations turmoil that goes with that. All this will put the dampners on the national property market over the next year or two.

In prime central London, things are slightly different - old money, City money and foreign money rules, and it is less mortgage reliant. Foreigners are buying, because of the cheap pound, and City folk are buying, because the stock market is recovering. Result: property prices are rising in these areas.

Prices have also been supported by very little stock coming on the market. However, this will right itself eventually, because many people who have been renting out their own homes will get fed up with that and want to sell, so they can make that big move up or down the property ladder.

The upturn in prime central London has happened much faster than anyone expected. Whether it can be sustained is a big question, but it is looking more that way. Some agents, like Cluttons, and some consultancies, like Capital Economics, are sceptical however.

A good time to buy may appear in the late autumn, because traditionally there are few other buyers around then, so those who do try to sell will include many "motivated sellers".

There is much uncertainty in the market. Sentiment is such an important factor, so gauging that will be key to figuring what the future holds. One indicator of confidence is the Young Index, published by the Young Group, which shows the majority of investors in the second quarter of 2009 believed London prices would be higher in twelve months time.

One thing is certain, if there is an upturn happening, then it is starting in the same place it always does, prime central London. In past upturns, it ripples out from the capital's most des res areas to the rest of the city and then on to the remainder of the UK. Savills say this is starting to happen with the market hotting up in south east England.

However, with the economy and public finances still in a mess, it may be a long time for this upturn to ripple out any further from London and its surrounding commuter belt. What's more, when those public sector cuts are made after the next election, any property price rises recorded outside of London's prime markets now and in the next few months, will be wiped out.

One exception, may be the country house market, which, like prime central London, relies on cash-rich foreigners, aristocrats and City boys to prop it up. The new City catchphrase "bonuses are back" suggests some people, at least, will be doing well over the next few months, even if the rest of us are struggling.

(All The World's a Home : Global Property News)

HEMP HOUSE

Necessity really is the mother of invention, especially if you are an architect. The combined problems of recession, climate change, commodity shortages, congested cities, lack of affordable housing and a host of other irritants would be enough to have many of us lie down in a darkened room with a wet towel wrapped round our heads, not so if you are one of the many enterprising architects coming up with clever ideas at the moment.

The latest wheez to come off the drawing board is a house built entirely out of hemcrete, a mix of hemp and lime. Called The Renewable House, it is low carbon, relatively cheap to build and constructed mostly from a material that can be grown in many countries.

Since hemp absorbs carbon dioxide from the atmosphere while it grows, the house's carbon footprint is reduced further. Designed by British-based Archial Architects, the modular homes can be used in either terraced, semi-detached or detached formats.

(All The World's a Home : Global Property News)

BARGAIN BASEMENT USA

Nowhere is safe. Property prices in The Hamptons, the Long Island playground of loaded New Yorkers, are falling for the first time after 20 years of continuous growth. Asking prices for one-third of Hamptons homes have been cut by an average of 11 per cent.

But if you think they have problems, then head west to the San Fransisco Bay Area where prices have crashed by 34 per cent over the past 12 months - masses of repossessed properties have been dumped on the market, accounting for half of sales.

A clue to what might happen next is found in Detroit where the car industry is becoming the stuff of history books. These days this city is less Motown than buy-to-let town. Prices for homes in the city have slumped by a third over the past year to an average of only USD80,000, a level so cheap, that investors from across the world, from Australia to Lithuania, are buying them up ten at a time.

These investors are banking on a long term reival in the city's fortunes. After all, this is not the first time the city has come through an economic crisis - the Great Depression of the 1930s is comparable. On that basis, a Californian investor has bought 178 homes in Detroit. Now that's confidence for you.

(All The World's a Home : Global Property News)

CHINA WANTS YOU?

China may make it easier for overseas investors to buy property there..... again.

A slump in foreign investment in its economy is worrying Beijing, because so many jobs depend on it. If red tape is cut, and foreign investors are given more freedom to buy Chinese property, then luxury home prices will rise by as much as 30 per cent, estate agents say.

Demand for des res abodes in big cities like Shanghai has risen sharply in the last couple of months, because Chinese HNWIs and investors are seeking safety in property from the turmoil in stocks and shares, and rising inflation. Foreign investors who can circumnavigate the bureaucracy are buying too.

Beijing's policies towards foreign investors tend to yo-yo back and forth, from encouraging them when times are bad to discouraging them when a speculative bubble appears, so if the government does relax its rules again, and you want a toe-hold in the world's third largest economy, then make the most of the opportunity while it lasts.

In Hong Kong, pictured here, where foreigners can buy property freely, flat and house prices have been rising since the start of 2009.

(All The World's a Home: Global Property News)

ITALIAN DEALS

Discounts of up to 15 per cent are available on apartments in Umbria and La Marche according to estate agents. These two Italian regions have become popular in recent years with overseas holiday home buyers who want a piece of the glorious Italian countryside, but not at relatively steep Tuscan prices.

A restored farmhouse in Umbria and La Marche usually costs from Euro1 million, and a two bedroom apartment in a restored farmhouse from Euro270,000. Wrecks are considerably cheaper.

A number of holiday home projects are appearing in this part of north west Italy, including Castello di Reschio, on the Tuscan/Umbrian border, where 50 farmhouses are being restored by Count Benedikt Bolza.

If your heart is set on something really special in Tuscany, then estate agency Cluttons is marketing a restored 18th century villa, pictured here, with Italianate garden near Lucca. The estate also includes a second villa in need of restoration, farmhouse, private chapel and 57 hectares of woodland, vineyards and olive groves. POA.

(All The World's a Home : Global Property News)

EYE OF THE STORM

The British property market appears to be staging a recovery. Don't be fooled. Savills says prices in prime central London rose 4.3 per cent in the second quarter. Hometrack says prices nationally held steady at 0 per cent rise/fall for the second month running in June. And Your Move says rents rose 1 per cent in June.

However, this may only be the eye of the storm, because as the recession and banking crisis recede, so huge public spending cuts and tax rises needed to pay off the national debt loom large on the horizon - these storm winds will most likely whip up sometime after the next general election which must be held within the next nine months.

Whichever political party wins that election, they will have to make thousands of public sector employees redudant and all of us pay more tax. Both of those things mean less money in the economy which means less money available for spending on housing. There's little chance big home loans will make up the difference, because banks are likely to remain reticent about lending on a massive scale for a long time yet.

In any case, the house prices to earnings ratio, currently at about 5, is still too high says consultancy, Capital Economics, so prices will fall 10 per cent this year, 5 per cent in 2010 and 5 per cent in 2011 until the long term average of 3.7 is reached. Either that or earnings must rise substantially and there is little sign of that happening.

(All The World's a Home : Global Property News)