REIA NEWS ISSUE TWO: JUNE 2011
LOBBYING ON BEHALF OF THE PROFESSION: WHERE IS YOUR NATIONAL ASSOCIATION TAKING YOU?
ALSO IN THIS ISSUE: PROPERTY PURCHASE AFFORDABILITY HAS IMPROVED AFFORDABLE AND SOCIAL HOUSING WESTPAC INITIATES FORUM THE GREAT PROPERTY DEBATE REIA CEO PRESENTS CASE AGAINST BUBBLE FIRST HOME BUYERS AND INTEREST RATES THE PATH FOR MONETARY POLICY IS CLEAR SUPPLY RESTRICTIONS AND PROPERTY PRICE VOLATILITY
WANT TO FIND OUT MORE ABOUT PROMOTING YOUR BRAND IN REIA NEWS? CONTACT REIA MANAGER COMMUNICATIONSRHIANNON MCCLELLAND ON 02 6282 4277 OR AT RHIANNON.MCCLELLAND@REIA.COM.AU FOR FURTHER INFORMATION.
PRESIDENTâ€™S REPORT WHAT DOES THE REIA DO? INSIDE YOUR NATIONAL BODY This month we have given you an overview of the important issues on which we are focusing our attention on your behalf, the ministers and shadow ministers we have met and what we are proposing needs to change in the property market. I was fortunate to meet with a number of important opinion makers with REIA CEO Amanda Lynch and our discussions feature in this edition.
You are probably aware that REIA is the national lobbying representative for the real estate profession and that our members are your state and territory Real Estate Institutes, but do you actually know what we do and how this directly affects you?
We have also released the REIA Deposit Power Housing Affordability Report this week, which has shown a slight improvement in housing affordability. Before you become ecstatic over this improvement, make sure you read our article on the report in this edition to understand exactly why the improvement has occurred and why there is still so
much more to do when it comes to housing affordability. Our Manager Policy, Jock Kreitals, has put together a story about first home buyers and interest rates and why the path moving forward on these issues should be very clear - a great read. This month we have also put together some useful links for you leading up to tax time which are available in the section titled Political Watch - Information from News and Government. We would like to thank the profession for all the wonderful feedback we had on our first edition of REIA News. We would like you to continue to let us know what you think so we can tailor future publications to suit your needs.
ON THE COVER LOBBYING ON BEHALF OF THE PROFESSION: WHERE IS YOUR NATIONAL ASSOCIATION TAKING YOU? The past month has been a busy time for REIA in regard to our lobbying efforts and meetings with a number of key ministers.
First home buyers • The falling participation of first home buyers in the housing market – this group’s presence in the market has declined rapidly from 30% of all financial commitments in 2009 to 15% now.
Our aim has always been to communicate the key issues of the profession to politicians and foster valuable dialogue between our organisation and representatives in government. During the past two weeks, REIA President and REIA CEO have met with The Hon. Kevin Andrews MP, Shadow Minister for Families, Housing and Human Services; The Hon. Tony Burke MP, Minister for Sustainability, Environment, Water, Population and Communities, and; The Hon. Joe Hockey MP’s Chief of Staff.
• The relativity of the First Home Owners Grant (FHOG) to median house prices - at $7k, this initiative is the same as when it was introduced in 2000 when house prices have more than doubled (median prices increased from $220k to $540k).
Some of the key issues that REIA is working through with the abovementioned opinion makers for you and your profession are:
• voluntary superannuation contributions when purchasing.
• The low take-up rate of the First Home Saver Account REIA has proposed, in its Pre Budget Submission, that first home buyers have access to their
“During the past two weeks, REIA President and REIA CEO have met with a number of key leaders.” Supply side constraints • Supply issues are a major determinant of housing affordability and need action from the Government. • Recent reports by Government have addressed the issues, but an implementation strategy and process are missing. • To satisfactorily address the issue of housing affordability, a strategy across all levels of government is imperative.
Right: REIA President David Airey with The Hon. Kevin Andrews MP, Shadow Minister for Families, Housing and Human Services. Below: The Hon. Tony Burke MP, Minister for Sustainability, Environment, Water, Population and Communities.
• REIA has indicated its willingness to work with government and other stakeholders in addressing supply issues. Banking competition • The Joint House Committee and Senate Committee have both reported on competition in banking and access to finance giving their support to enhancing competition from the mutuals sector as a fifth pillar to the banking sector. • REIA supported such a move in its submissions to the two inquiries. • REIA would like to see some positive action by Government in this regard. Taxation • REIA is lobbying to have negative gearing provisions retained.
• REIA has a commitment to no Capital Gains Tax (CGT) on the family home.
GST as part part of the considerations.
• CGT on investment property should not increase - taxation of property needs to be treated identically to that of other forms of asset investment.
“...REIA will continue to maintain a strong presence with Government on these issues.”
• Stamp duties on property need to be abolished and replaced by an efficient source of revenue for states. Stamp duties are an inefficient and volatile source of revenue for states and have been recognised by Henry Review as an impediment to economic growth. Tax Forum • REIA is seeking a seat at the Tax Forum in October and will be putting a case for reform of state property taxes. • REIA would like to see
REIA will continue to maintain a strong presence with the Government on these issues as they are crucial to the success of your profession and maintaining a healthy property market. In coming weeks, REIA will be stepping up our advocacy over our concerns with The National Occupational Licensing System and continuing to argue for the retention of negative gearing concessions for investment properties.
INDUSTRY ARTICLE TIPS FOR YOUR CLIENTS: THE BEST INVESTMENT IS A GOOD TENANT As property managers will know, keeping good tenants happy is one of the best investments a landlord can make. Here are some suggestions you can offer your landlords to help them hold on to great tenants: Keep up appearances Landlords should give their tenants a reason to take pride in their property. A home that is poorly presented by the landlord may be poorly cared for by the tenant. Presenting a clean, tidy and well cared for property will encourage tenants to treat the property as if it were their own. Lower the maintenance A property that requires as little maintenance as possible will make life much easier for both tenants and landlords as it will minimise the effort and cost
involved in the upkeep of the home. Pay for a gardener Landlords with gardens should ensure they are free from construction rubble, landscaped and as low maintenance as possible. Hiring a professional gardener to attend to the property every few months is likely to be a welcome gesture that can assist the tenants to keep the garden under control.
“You can check a tenant’s past but you can’t predict their future.” Attend to maintenance issues promptly A tenant who isn’t getting the attention they deserve might begin to question their
commitment to the property and become more careless with it. Injury or loss resulting from a safety hazard that has not been attended to might also give rise to a costly legal liability claim. Don’t take good tenants for granted You can check a tenant’s past but you can’t predict their future. Even the best tenant can accidentally damage a property or lose their job and be unable to pay rent. Landlords who elect to take out landlord insurance cover should always read their product disclosure statements carefully so they know what they are covered for. For further information, visit www.terrischeer.com.au or call 1800 804 016.
INDUSTRY ARTICLE INSURANCE ADVICE: ARE YOU UNDER-INSURED? Under-insurance is one of the key issues facing the real estate industry. Having the right amount of cover in place is imperative, as underinsurance can be costly for your business if something goes wrong. The whole purpose of insurance is to put you back in the position you were in before the loss event occurred. If the declared insurances are understated, this does not occur – which can have a catastrophic impact on the business. What’s concerning is that many businesses do not consciously decide to insure below the full replacement value of business assets and revenues to save on insurance premiums, or because they think a disaster would never
“.... under-insurance can be costly for your business...” happen to them. Many actually believe they are adequately covered. In assessing coverage, a business should ensure they insure assets for their true replacement value. Replacement value is everything that you would need to pay to rebuild the asset if it was damaged. This figure includes building materials, labour costs and often forgotten necessities such as the removal of debris. It is also vitally important that the correct business interruption period is declared to ensure loss of earnings coverage is available until full trading conditions are reinstated. Choose an insurance broker with a depth of experience in
the real estate industry and the relationship and knowledge of available insurers to select a credible, stable insurer with a strong security rating for you.
“Choose an insurance broker with a depth of experience in the real estate industry.” Aon is able to provide you with professional guidance and assistance on a range of insurance options and to liaise with the insurer on your behalf. Visit our website at www.aon.com.au/realestate for more information or call your local Aon representative on 1300 734 274.
WE’VE GOT WHAT IT TAKES TO
REPUTATION In this competitive property market mistakes can happen in the course of carrying out your professional duties. It could be failure to act according to your client’s instructions, undue delays in dealings or a personal injury suffered by a tenant in a property you are managing. If such a claim is brought against you, you could end up paying with your business, personal assets and your reputation. Aon’s professional indemnity insurance enables you to defend such claims and protect your assets and professionalism. Our products are backed by an experienced service team, located in over 30 offices Australia wide.
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PROPERTY PURCHASE: AFFORDABILITY HAS IMPROVED BUT DON’T GET TOO EXCITED It’s been doom and gloom for affordability for more than two years now, but a small turnaround in the average Australian’s ability to repay their mortgage is nothing to get too excited about.
“... the change is very small and a lot still needs to be done to improve the level of affordability in Australia.”
The 2011 March quarter REIA Deposit Power Housing Affordability Report has shown a slight improvement in housing affordability nationally, with a decline of 1.1 percentage point in the proportion of income required to meet loan repayments. Over the year, the level of affordability in Australia declined with the proportion of income to meet home loan repayments increasing 1.6 percentage points.
But before we get too excited, the change is very small and a lot still needs to be done to improve the level of affordability in Australia. What needs to be highlighted is that the reduction in the proportion of family income required to meet loan repayments is explained by a decline in the average monthly loan repayment of 1.9% and an increase of 1.2% in the median family income over the March quarter. New South Wales remained the least affordable state or
territory in which to own a home, with the proportion of income required to meet loan repayments decreasing to 37.2% - 3.0 percentage points above the national average. The Australian Capital Territory has now been the most affordable state or territory in which to own a home for over five years and New South Wales has held its position as least affordable for more than fifteen years.
“... New South Wales has held its position for more than fifteen years.”
Keith Levy National Manager, Deposit Power We know that our two-speed economy is going to impact the Australian property market, but the question that remains is - how? And by how much? Confidence in the sector is waning with reports that new home sales are down on last year and average prices are falling in some areas. Australian households are clearly vulnerable to interest rate rises and this has been demonstrated by low housing affordability statistics, despite the marginal improvements this quarter. The number of home loans and first homebuyers have fallen further this quarter.
However the outlook for the economy is generally positive, buoyed by investment in mining and resources and with low levels of unemployment. Rental returns are high and housing demand will continue to increase with our growing population. For this reason, weâ€™re unlikely to see major, longterm structural changes to the housing market. We should also keep in mind that despite the current minor weakening of prices, the housing market has proven to be a viable long-term investment for many Australians. For more commentry from Keith Levy on the state of the housing market, download the REIA Deposit Power Housing Affordability Report by clicking below.
To download your copy of the Deposit Power Housing Affordability Report, click here.
AFFORDABLE & SOCIAL HOUSING WESTPAC INITIATES FORUM Westpac executives from Australia and New Zealand met with local and state governments in Sydney on 31 May to discuss the reshaping of the social and affordable housing sector in both countries. Westpac Institutional Bank convened the forum to offer both its knowledge and experience within the sector and connections with broader market participants to assist Government, not-forprofit organisations and private capital providers address this growing social need. According to Westpac, social and affordable housing is low cost housing provided to tenants who are reliant on benefits or earn a low level of income from private sources. Participants shared
information on the challenges, opportunities, regulatory developments, and professional experiences in Australia, New Zealand and the UK, with the aim of broadening the level of knowledge of the issue and potential solutions under development.
development and management of affordable housing they need to demonstrate a capacity to undertake debt and equity raisings for investment in the development, acquisition and ongoing management of housing stock in order to win tenders for government incentives.â€?
Social housing has traditionally been built through capital programs fully funded by Government. However, constraints on such funding have led to other avenues being explored. Consequently, recent government policy, including a federal commitment for the building of 80,000 affordable rental homes, has created opportunities for not-for-profit or NFP housing organisations.
Westpac Institutional Bank has identified social and affordable housing as a real issue within the broader community where the bank can apply its skill set working with key stakeholders in the sector to develop sustainable solutions for the benefit of the broader community.
Westpac Managing Director Debt Capital Markets Karen Silk said, â€œAs NFP housing organisations move toward a more commercial role in the
THE GREAT PROPERTY DEBATE: REIA CEO PRESENTS THE CASE AGAINST THE HOUSING BUBBLE
Ms Lynch went on to explain how the housing bubble myth had taken hold. The graph below (used in the presentation) shows that since 2003, the price-toincome ratio has been more than 40% higher than the long term average. A copy of the presentation is available on the REIA website. To download a copy, click here.
Chart 1: House price-to-income ratio Source: OECD Economics Department 150.0 140.0 130.0
United States Australia
120.0 110.0 100.0 90.0 80.0
At the outset, Ms Lynch explained the purpose of the presentation was to show that house price-toincome ratio is not an accurate
akin to variations in altitude and speed.”
The presentation showed that REIA research is based around economic fundamentals that can be explained rationally. Ms Lynch said, ”Rather than a housing bubble, with its impression of something filled with air that is light and without substance, think of these fundamentals as like the engines underneath a powerful jet with the short-term factors
In the presentation titled Australian House Prices Bursting the Bubble Myth, Ms Lynch highlighted that real estate agents had often been called the ‘Pollyannas of the property industry’ and quickly cut to the chase to with a series of graphs, tables and factual information to show that the presentation and REIA’s argument was underpinned by evidence, not irrational speculation based on price movements which seem dramatic.
and sufficient indicator of house price overvaluation - the measure which most housing bubble arguments are based around.
REIA CEO Amanda Lynch presented at The Great Property Debate, highlighting why there is no housing bubble in Australia.
FIRST HOME BUYERS AND INTEREST RATES: THE PATH FOR MONETARY POLICY IS CLEAR As seen in Chart 1, during the last decade, the proportion of all finance approvals to first home buyers has been both declining and extremely variable. The downward trend was arrested in October 2008. In June 2008, 17.2 percent all finance approvals were to first home buyers. In June 2009 this was up to 27.9 percent. The latest available for March 2011 has the percentage of first home buyers as 16.0 per cent. This is well down on the average since July 1991 of 21.3 per cent. Whilst the reasons for these changes are manifold and cannot be attributed to a single factor the part played by interest rates
Chart 1: Proportion of total finance approvals to first home buyers Source: ABS
“...the part played by interest rates is crucial...” is crucial as illustrated in Chart 2 below which shows that when official interest rates go up the proportion of first home buyers declines and vice versa. Whilst the introduction of the Boost to the First Home Owners
Grant in October 2008 and its subsequent phase down during the second half of 2009 and its cessation in December 2009 influenced first home buyers’ decisions, the rapid drop in interest rates from September 2008 to April 2009 when official rates decreased by 4.25 percentage points and the subsequent tighter monetary policy from October 2009 was
This article is brought to you by REIA Manager Policy, Jock Kreitals. Jock can be contacted at firstname.lastname@example.org
â€œMonetary policy settings together with median house prices and household income determine housing affordability.â€? Chart 2: Proportion of total finance approvals to first home buyers changes in cash rate Source: ABS
a dramatic influence in the participation of first home buyers. Monetary policy settings together with median house prices and household income determine housing affordability. It is no coincidence that the REIAâ€™s measure of housing affordability improved by 26 per cent from
September 2008 to March 2009 and then declined by 23 per cent to December 2010 reflecting the changes in official interest rates. If further erosion of housing affordability for first home buyers is to be avoided the implications for monetary policy are quite clear.
SUPPLY RESTRICTIONS AND PROPERTY PRICE VOLATAILITY In the recently published policy document “A Sustainable Population Strategy for Australia”, the Government proposes a set of strategies seeking to meet Australia’s population needs, among other things.
Certainly, restricting immigration will bring about lesser pressure on property prices but at a huge economic cost. The main issues that can solve effectively the housing supply shortage, that is, land releases and development processes, are not addressed in the states’ policy agendas so far.
Many have criticised this strategy as it does not set a population target in the medium and longterm time framework, which does not abate upward pressures on property prices.
Chart 1: Population growth
“...restricting immigration will bring about lesser pressure on property prices.”
Undoubtedly, the Government is putting in place significant programs that will contribute
to mitigate to some extent the undersupply of housing, but there are no explicit policies tackling the bottlenecks present in the land release and development processes. And this is where the problem is. The figure below shows the population and building approvals growth rate by state and territory between 2004 and 2009. The states and territories located above the green line are those whose population growth
This article is brought to you by REIA Research Officer, Johann Rojas. Johan can be contacted at email@example.com
â€œThe most critical situations are observed in New South Wales, Western Australia, Tasmania and Victoria.â€?
the population growth rate is relatively larger than the increase in building approvals would suffer greater property price volatility to demand shocks than the rest of the states and territories. This is because in those places where building approvals and land release are more flexible, increases in population would lead to more building, not to higher prices.
rate was greater than the building approvals growth rate over the period.
The table below shows the standard deviation, which is a measure of variability, of established property price
The most critical situations are observed in New South Wales, Western Australia, Tasmania and Victoria, where the population growth rate was significantly larger than the growth rate in building approvals. For example, in New South Wales the population grew 6.8% while building approvals decreased by 39.7% between 2004 and 2009. Those states and territories where
quarterly growth rates from June 2004 to March 2011. In those states and territories where the population growth rate was relatively greater than the increase in building approvals, capital city property prices present more volatility, except for Hobart. Easing land release and development processes would bring about more stability to the property prices, attracting more investors and buyers and making more dynamic the market.
Industry news from around Australia
Finalists in 2011 REIV Senior Auctioneer of the Year The finalists in the 2011 REIV Senior Auctioneer of the Year competition were announced yesterday. The six finalists were selected by judges from 19 nominees who competed in yesterday’s heats. Each participant had to conduct a mock auction dealing with testing inquiries and competitive bidding from the audience. The finalists will compete for the title of 2011 REIV Senior Auctioneer of the Year on Wednesday, 13 July at The Arts Centre.
state budget as a lost opportunity for the government to back up its Affordable Housing Strategy with economic stimulus. REIWA President Alan Bourke said that while the budget had been pitched by the Premier as a “social budget” to help the needy, there was nothing in it to address affordable housing. “If the government is serious about helping people into more affordable homes, including affordable rental accommodation, then it needs to reduce the burden of stamp duty and the cost of land tax for owners with more than one property,” Mr Bourke said.
REIWA: WA Budget a lost opportunity
REIQ Host Experts’ Guide to Buying Queensland Property, supported by 4bc
The Real Estate Institute of Western Australia described the
The seminar is designed for firsthome buyers, new and seasoned
investors or anyone interested in Queensland property, this session will address some of the key questions about buying property and provide practical advice to make the process as stress-free as possible. Attendees will receive a free 14 day PriceFinder subscription and a complimentary copy of the latest REIQ Queensland Market Monitor. Details for the event are: When: Saturday 18 June, 9:30am – 1:30pm Where: REIQ, 21 Turbo Drive Coorparoo Cost: $129 per ticket or two for $200 (incl. GST) Bookings close: Wednesday 15 June Further information: 07 3249 7373
Making News General national news
Raising the curtain on tax time
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2010 combined with cyclones in both Queensland and Western Australian have had a significant impact on the March quarter activity. Despite the fall in GDP volumes there was an increase of an increase of 0.3% in Real gross national income driven by an increase of 5.8% in the Terms of trade on the back of stronger commodity prices. The main detractors to expenditure on GDP were Net exports (-2.4 percentage points) and Inventories (-0.5 percentage points). Private gross fixed capital formation was the largest positive contributor.
Australian economy contracts
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Latest ABS figures show that GDP, in seasonally adjusted volume terms, declined 1.2% in the March quarter 2011. This is the largest quarterly fall in GDP since the March quarter 1991. Flooding which began in late December
Westpac named bank of the year
ATO First Assistant Commissioner Sue Sinclair in a speech to the Institute of Public Accountants discusses Tax Time 2011; Prefilling; Work related expenses; Small business benchmarks; Data matching, detecting and deterring fraud; Processing cycles; Superannuation guarantee; The ‘extra step’ in extraordinary events; Budget wrap.
Westpac’s focus on understanding its customers and going the extra mile to help improve their businesses has
contributed to it being named Money Magazine’s Business Bank of the Year for the fourth consecutive year. Scoring consistently well across all award criteria, Westpac was applauded for the flexibility of its business products. Westpac’s Bank Bill Business Loan, Business Choice credit cards, Business One Account, Business One Cash Reserve and Bonus Cash Reserve were all named as standout business product offerings. “The fact that Westpac has been declared Business Bank of the Year for four years in a row shows that we are more serious about supporting business than any other bank,” Westpac Group Executive Retail and Business Banking Rob Coombe said. For further information, click here.
Information and news from government
Relief for small business In a joint press release, Leader of the Opposition, Tony Abbott and Shadow Minister for Small Business, Compettion Policy and Consumer Affairs, Bruce Bilson said the Coalition would work to relieve the red tape burden from Australia’s small businesses by giving them the option to remit the compulsory superannuation payments made on behalf of workers, directly to the ATO.
20,000 homes delivered The Senate Community Affairs Committee tonight heard that more than 20,000 dwellings have been delivered under the Federal Government’s housing agenda. Minister for Social Housing and Homelessness Mark Arbib said the Federal Government’s $5.6 billion Social Housing Initiative was on track and delivering muchneeded homes to vulnerable
Australians. “There are 14,200 social houses that have been completed with more than 5,000 currently under construction,” Senator Arbib said. These homes will provide accommodation for the elderly, people with disability and those who are homeless or at risk of becoming homeless.”
Raising the curtain on tax time ATO First Assistant Commissioner Sue Sinclair in a speech to the Institute of Public Accountants discusses Tax Time 2011; Prefilling; Work related expenses; Small business benchmarks; Data matching, detecting and deterring fraud; Processing cycles; Superannuation guarantee; The ‘extra step’ in extraordinary events; Budget wrap. For further information, click here.
Australian economy contracts Latest ABS figures show that GDP, in seasonally adjusted volume terms, declined 1.2% in the March quarter 2011. This is the largest quarterly fall in GDP since the March quarter 1991. Flooding which began in late December 2010 combined with cyclones in both Queensland and Western Australian have had a significant impact on the March quarter activity. Despite the fall in GDP volumes there was an increase of an increase of 0.3% in Real gross national income driven by an increase of 5.8% in the Terms of trade on the back of stronger commodity prices. The main detractors to expenditure on GDP were Net exports (-2.4 percentage points) and Inventories (-0.5 percentage points). Private gross fixed
Information and news from government
capital formation was the largest positive contributor.
previous month. Revolving credit commitments rose 5.3%.
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ABS Lending Finance
ABS Housing Finance
The Australian Bureau of Statistics released Lending Finance, Australia for March 2011. The total value of owner occupied housing commitments excluding alterations and additions fell 1.7% in trend terms and the seasonally adjusted series fell 1.1%. The seasonally adjusted series for the value of total personal finance commitments rose 0.5%. Fixed lending commitments rose 2.1%, while revolving credit commitments fell 1.2%. The seasonally adjusted series for the value of total commercial finance commitments rose 13.3%. Fixed lending commitments rose 17.1% following a 10.0% fall in the
The Australian Bureau of Statistics released Housing Finance, Australia for March 2011. The trend estimate for the total value of dwelling finance commitments excluding alterations and additions fell 1.6%. Owner occupied housing commitments fell 1.7% and investment housing commitments fell 1.3%. In seasonally adjusted terms, the total value of dwelling finance commitments excluding alterations and additions fell 0.1%. For further information, click here.
ABS Dwelling Approvals ABS Building Approvals show that the total number of dwellings approved fell 1.3% in April 2011, in seasonally adjusted terms, after rising 8.6% in March. Dwelling approvals decreased for the month of April in New South Wales (-12.9%), Western Australia (-9.6%) and Tasmania (-8.7%) while Queensland (+29.2%), South Australia (+9.9%) and Victoria (+0.3%) recorded increases in seasonally adjusted terms. In seasonally adjusted terms, approvals for private sector houses fell 3.3% in April. For further information, click here.
Property news from around the world
Housing recovery to precede economic recovery According to Radar Logic, a real estate data and analytics firm, strong job gains will not bolster the housing market despite opinions from economic experts. The New York-based firm predicts that a recovery in housing values will precede a recovery in the economy, spending, and jobs.
are discussing ways of granting owners of properties in the emirate, residence visas based on transparent rules and legislation. “The rules are expected to be issued soon,” the source said. Al Bayan Arabic daily reported yesterday that Dubai would issue a law granting specific categories of property owners to have residence in Dubai.
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Dubai studies property visa
Foreclosures remain an issue for New London
Dubai is studying the enforcement of a new residence visa system for property owners, sources from the government confirmed this month. The government official, who spoke on condition of anonymity, said that authorities in Dubai
Four years after the subprime mortgage crisis hit, and two years after New London organizations used $2 million to help turn around hard-hit neighborhoods, foreclosures are still a major problem for the city.
In April 2009, according to city assessment records, New London had 95 foreclosed homes on the tax rolls; this past April, the number was 91, which includes bank-owned properties, recent deeds-inlieu of foreclosure and 65 condominium units at the Gull Harbor complex that went into foreclosure in October. The Warren Group, which tracks New England real estate data, reported a similar trend, with New London foreclosures and foreclosure filings, which don’t always lead to a property owner’s loss of a home, falling only slightly, from 312 three years ago to 296 last year. For further information, click here.
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