PROPERTY HOTSPOTTER - OCTOBER

Follow the agents who follow the money

Who opened or expanded branches during September

The World – A&K International Estates was launched. This new estate agency arm of travel group, Abercrombie & Kent, will market GBP1m+ homes using its worldwide network of 50 offices and database of 250,000 HNWI clients.

Clapham (London) - John D Wood & Co

Marylebone (London) - Thamesview (purchased Harris Latner)

Mayfair (London) - Winkworth opened Chinese-speaking desk.

Cascais (Portugal) - Fine & Country


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

PROPERTY HOTSPOTTER - SEPTEMBER

　
Follow the agents who follow the money

Who opened or expanded branches during the summer

Henley-on-Thames – Sotheby's International Realty

South Kensington (French-speaking branch) - Douglas & Gordon

Central Kensington - Chesterton Humberts

Stockwell, Tooting and Mitcham (South London) - Century 21 franchise (formerly Abbey Estate Agents)

Maldives - Christies International Real Estate (affiliation with Dutch Docklands)


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

BIG ESTATE AGENTS OPEN ON FRENCH RIVIERA

Glamour versus austerity

Four international estate agencies opened offices, formed affiliations or acquired local estate agencies on the French Riviera between March and June this year – Savills, Knight Frank, Chesterton Humberts and Christies International Real Estate. The agents say the French Riviera's luxury housing market is benefiting from a domino effect with a growing number of increasingly wealthy international HNWIs buying a home in London and then wanting a place on the Cote d'Azur.

But with the French economy stalled, President Hollande raising taxes and the eurozone in crisis, how well timed is this move to the Med? Some estate agents and buyers agents who have been operating on the Riviera for a while say they would be busier sitting on the beach this summer, because so few buyers are around. But other agents say business is good, so it is not clear which way the market is headed in the short term.

The longer term must surely be bright. Times may be rocky now, but they were worse during World War Two, and the Riviera recovered from that, so why not this time? The Cote d'Azur is and will remain one of the most glamorous places in the world. When the eurozone crisis is finally resolved, estate agents, letting agents and buyers agents will be far too busy to even contemplate spending summer on the beach.

The leaves unanswered the big question of “how long must we wait for the good times?”. Nobody knows. It could be months, but more likely years, and it brings to mind Warren Buffett's advice to stock buyers which must hold true for the housing market - “Only buy something that you'd be perfectly happy to hold if the market shut down for 10 years.” Hopefully, it won't be that bad.

BRITAIN'S RACIST AND RIP-OFF LANDLORDS

The Rachman era returns

Forget the market-rigging bankers, the phone-hacking journalists and the bribe-taking police. What about the rip-off landlords who bring shame on Britain? Yesterday, two shocking bits of news came to light.

First, the London borough of Brent announced its crackdown on “Beds in Sheds”. In the past three years the council has issued 84 planning enforcement notices against home-owners who rented out their garden sheds to desperate tenants, so now it wants to put a stop to this exploitation once and for all.

Second, it turns out many landlords are racists – a BBC investigation of London and Birmingham landlords has found some choose tenants on the basis of race. For example, their adverts say tenants “Must be Bangladeshi, Pakistani, Indian” or “Filipino only” or “Sri Lankan professional couples”. The BBC and Letting Agent Today ask whether these landlords are breaking the law? Well, if they aren't, then they darn well ought to be. Weren't the days of “No dogs, no blacks, no Irish” supposed to be long gone?

Britain's landlords are developing a shocking reputation. Increasingly the worst among them make headlines for the wrong reasons – intimidating tenants, operating dangerous boilers in rental properties, evicting tenants to replace them with higher paying Olympics visitors are some examples of their outrageous behaviour. No wonder the London Borough of Newham and the Welsh government want landlords licensed. That way the Rachmanesque among them can be weeded out.

Yes, many landlords are decent human beings who provide decent accommodation at a decent price. But the private lettings market is becoming so tainted by criminality, incompetence and greed, that it is time for decent landlords to stand up and take action against their corrupt peers. The National Landlords Association's Code of Practice whilst laudable is not enough. The body should support landlord licensing or, at least, a landlords register to professionalise the sector fully. Scotland has a landlords register and limited licensing system. Time to extend that across the rest of the United Kingdom.

POLLUTION WILL AFFECT HOUSING MARKETS

What price clean air?

In Rio the politicians are discussing how to save the planet. In Hong Kong a friend has posted a facebook status update which shows in graphic detail how our survival on this planet is threatened. It gives a link to a University of Hong Kong website http://hedleyindex.sph.hku.hk/home.php which shows smog in Hong Kong today (June 20^th) at levels the World Health Organisation considers “Very Dangerous” owing to northerly winds blowing China's industrial air pollutants southward. Four Hong Kong people will die today because of this pollution the university's School of Public Health forecasts. Air pollution in Hong Kong has exceeded safe levels for 139 out of 171 days so far this year.

What has all this got to do with property you may ask? Well, one of the reasons why I moved away from Hong Kong in the 1990s was because of its worsening air pollution. My departure has barely made a nano-dent in the territory's demography, because vast numbers of Chinse have moved into Hong Kong since I left, pushing up its population by about a million, so this means pollution has not stopped Hong Kong from continuing to expand and this has provided knock-on benefits for its economy and the value of its clearly much sought-after homes. However, many more individuals may leave Hong Kong in future and this could have an impact on its housing market.

As Hong Kong University's research shows, the cost of treating pollution-related diseases and the loss of productivity has drained HKD18 billion (GBP1.5 billion) from the Hong Kong economy so far this year. And the problem is worsening. As the costs to people's health and businesses mount up, so a tipping point will be reached where more non-Chinese leave Hong Kong for a place where they can breathe, and reduced numbers will want to move there. That will have a negative affect on the territory's economy and that, plus the direct affects of reduced housing demand, will have a negative affect on its property market, especially at the upper end which overseas corporates favour for accommodating expatriate staff.

Admittedly, we could be talking decades, certainly years, but if current trends continue then this will surely happen eventually. Another caveat, Chinese immigration, which forms the vast bulk of people moving into Hong Kong, is unlikely to be affected, because they come from a place that is no less polluted. And yes, Chinesification could fill the gap left by departing expatriates, but Hong Kong is a trading city that depends on its oversess links. What's more, many of those Chinese and Hong Kong residents who can afford to leave will do so.

What may happen in Hong Kong could be replicated in other locations across the world, wherever air pollution, rising water levels, extreme weather and other environmental disasters become overwhelming. And while those locations suffer population loss and economic decline, the safe havens where people move to will see increased pressure on housing stock. If not enough homes are built to keep up with the demand from incomers in these locations, then sales prices and rents will rise. Of course, if the world's environmental problems are sorted out then none of this may happen.....

PROPERTY HOTSPOTTER - JUNE

Follow the agents who follow the money

Who opened or expanded branches in May

St Johns Wood (London) – Chesterton Humberts

Central London - Christies Private Property (new buyers agency)

Henley and Cobham - Sotheby's International Realty

Bristol - Hamptons International

Hong Kong - Landscope Christies International Real Estate

Asia - Sotheby's International Realty (expands management team)

Malta - Chesterton Humberts


PROPERTY HOTSPOTTER is updated monthly. 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

IMPACT OF POLITICS ON PROPERTY MARKETS

...it grows bigger every day...

Not since the fall of the Berlin Wall have politicians had such a big impact on property markets. The end of state Socialism in eastern Europe in the late 1980s and early 90s allowed for the return of private property ownership there and in China, while in Britain and the United States this transformation coincided with conservative politicians striving to create "property owning democracies" in which tenants could become home-owners.

Today, politicians who reform housing markets do so more through pragmatism than idealism. By raising property taxes the Chinese government has ruthlessly engineered a downturn in its property market to squeeze out inefficient property companies. The Hong Kong, Taiwan and Singapore authorities have introduced taxes and buyer restrictions to cool overheated housing markets too.

In Europe, the Portuguese government will administer the economic equivalent of CPR to its recession-blighted construction sector this month (June) by allowing landlords to raise rents for the first time in 30 years, so they can fund building improvements. Politicians had been putting off this reform for 25 years, because they didn't want to be confronted by angry tenants.

Politicians are impacting on property markets in unintended ways too, sometimes far from home. Property prices in prime central London are higher now than they were during the previous market peak in 2007, because of a house price boom fuelled by an influx of Greeks escaping political meltdown in Athens, French avoiding newly elected President Hollande's planned tax rises, Russians fleeing arbitrary rule under re-elected President Putin, Chinese escaping corruption and autocracy in Beijing and Arabs leaving behind political turmoil in the Middle East.

This politically-driven flow of wealth across the world can have political repercussions in the safe havens where it is directed - in Switzerland, citizens have voted to limit foreign home ownership to 20% in tourist areas, because they are fed up with first-time buyers being priced out of the housing market by wealthy incomers.

The grand projects of politicians may even touch on London's safe-have reputation in two years' time. At the behest of the Scottish National Party, Scotland will have a referendum in 2014 on whether to become independent - although according to opinion polls only 40% of the country is currently in favour of full devolution. If the Scots do vote "yes", then there will be wrangles between Scotland and the remainder of the United Kingdom over who owns which North Sea oil fields and is responsible for the debts of Edinburgh registered banks like Lloyds and Royal Bank of Scotland. The arguments will create uncertainty, which housing markets don't like. Resolution of the arguments could see one or both newly separated countries less well-off or better-off than before, which will have a knock-on effect on their housing markets.

An understanding of economics has long been recognised as useful when analysing the world of property - all those GDP numbers, interest rate stats, construction data and other facts and figures have a bearing on which way a housing market may move. Now, with politicians having an increasingly big impact on property markets, intentional or otherwise, it pays to have an understanding of politics too.

I wrote this blog piece for property consultancy, Knight Frank's Global Briefing, published today.

http://globalbriefing.knightfrank.com/post/2012/06/07/The-growing-influence-of-politics-on-global-property-markets.aspx