Despite News of Hope World Real Estate is Down



Across the United States families, investors, even the bug exterminator who sprays homes have been affected by this recession. Not just affected in some cases, devastated. Despite news every morning of a better day “a” comin though, property prices continue to fall. The world real estate market looks more like a flea market peddler than a Wall Street titan.

It does not take a property expert or economist to figure out how much trouble the world real estate situation is. At least “in trouble” where the small investor is concerned. A cursory look into Google News can provide all the data anyone needs actually. Looking at selected countries around the globe, it’s quite clear property values are still headed nowhere but down in many markets.

The southern slope of Karavanke - courtesy Viviun

 

Slovenia is one of the emerging EU countries that has shown the most promise in many sectors, real estate being one. However, Q2 indexes show even Slovenia has its price problems.  Apartments prices in Ljubljana, and other Slovenian areas fell by as much as 1.8% Slonep, a web portal that tracts housing prices there. Housing starts and other construction oriented property business there has also slumped by as much as 30 percent, year on year. And other former “boom” markets in Europe are fairing no better. The image of a farm for sale amid the Julian Alps in Slovenia is a good indicator of value. €700,000 euro for such a paradise is peanuts.

Bulgaria is one country that has seen a recent “Bull” market where property sales is concerned. Property prices in the country’s capital of Sophia dropped by over 10 percent since last year at the same time, according to The Sophia Echo.  The Black Sea city of Varna, a seaside jewel not so many investors have ever heard of, saw similar declines in property prices over the same perood. And, the Winter resorts in Bulgaria, despite their popularity, are making out no better. The image below is of a seaside apartment at the all new Varna South Bay Beach Residence. For as little as €91 245 euros, a beach dream will come true for many.

Dream Bulgaria

An example of what is possible on the Black Sea - courtesy Dream Bulgaria

 

 

The larger economies have been hit even harder it seems. The UK, the Russian Federation,   Singapore, Saudi Arabia, even China indexes show many challenges going forward into 2012 and beyond. As for the US. Well, the same old confusion exists as to whether the market is up or down. Depending on whom you read or listen to, real estate in America could be about to skyrocket – or sink like the Titanic. Just how anyone could predict positive home sales with so many unemployed – this seems like folly. And the same hold true worldwide. If China has every manufacturing job known to man, and still people cannot afford homes. You see the trend.

Finally, as anyone could predict, investment in certain assets has increased globally. Put very bluntly, investors with resources are snapping up a disproportionate number of bargains worldwide.  As prices continue to fall, some institutions make out like bandits in bolstering their portfolios. Investment is the only thing skyrocketing actually. And we are not  talking about the guy next door investing either. At the same time John Doe cannot afford to visit Walmart (or Lidl in Germany) big time investors are cashing in on acquisitions. Jones Lang LaSalle’s 2Q Profit Gains 38%, CIC reports $51.5b net profit, everyone from Forbes to the street corner peddler knows money is flowing like water for I bankers and speculators.

Family income win goes to the already rich

The already rich win during the worst recession in history

 

Just what all this means for the every day Joe is not touched upon by so many. Looking at the how legendary investor George Soros has backed out of what many would call “reasonable scrutiny” where his massive hedge fund would come under the looking glass next year – Soros closed the fund to outside investors – a degree of Machiavellian plot seems to surface. A conspiratorial theorist would just say “Big Brother” has decided to take over what’s left of society’s portion. The filthy rich are buying premium properties as if their lives depended upon real estate. A good example, Hamburg, Germany property sales, shows those “with” money, know what’s safe and what is not.

“One man’s loss is another man’s gain,” or so the saying goes.  The chart above from Marketing Charts shows that Americans are not only being outdone by the upper 1 percent, but what’s more disturbing is, they are totally unaware of the metric. More later.

Golden Watercastle

The Golden Wastercastle and other Hamburg property is at a premium - courtesy Kliefi