Norm_uk

One of my clients said almost exactly the same thing to me last week when we were talking about their plans to leave within a year...

It's sadly partially true but there are plenty of people who are thankfully not ostentatious.



N.

IndieG

Just heard property speculators are screwed big time

Turns out that so called "cash buyers" (who were supposedly propping up the market and didn't need to "distress sell") haven't really got any cash at all. They just about had enough money to put the first 10% in cash (required to book a property), and they bought 30-40 properties at a time. When the next installment was due - they sold 2-3 properties, and paid the next instalment in cash. Now the next instalment is due, they are unable to flip their properties and can't raise enough cash to pay up - developers are after them............ a big mess apparently.

Can you imagine what this is going to do to the property market - prices were driven up entirely by such speculators and not genuine user demand? I shudder to think.

HSBC has increased its LTV on properties - now requiring a 50% downpayment.

Norm_uk

If that's true it's pretty horrific - although good news in the long term provided they learn from their mistakes!

N.

shiva

hate to say "i told you so"......actually I dont hate it, i've been saying it for 3 yrs.
This market has never had any fundamental reason for the insane increases, barring misplaced confidence and over active imaginations..........cant wait to pick up a Hatton for peanuts

shiva

exactly, i'm a firm beliver that the global crunch is long overdue and needed to bring people back to reality. At no point in human history has it been wise to spend and borrow several times your net worth on the basis of speculation

TGFKASE

Also just heard aa rumour from the 'Emperors's Inner Circle' that JBR is going to be 'downsized'!! 15% occupancy and Mo thinks its an absolute eye sore amongst all the steel and glass going up in the Marina. Word is at least 3 towers will be pulled down....

Wonder how many of those unpaid instalment owners are going to see there investment razed to the ground......

Meow

Interesting. I heard that a few months ago.

It is bloody ugly, but will they really knock it down? Bad publicity surely? (And we know that isn't allowed.)

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Meow

Just about every local lender has reduced their LTV too.

Anyone who put all thier cash into intial installments in that way, hoping to fund future payments by flipping, is an idiot. How is it that people forget that property is just another asset class and that it goes down in value too?

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IndieG

Straight from the horse's mouth so to speak

typical

If anyone is brave enough to put this into a research note or news story... please let me know!

IndieG

I meant increased its margin/reduced ltv, I've said just the opposite above....lol

Blue Cat

surely it is just rumour? if they were to knock three of them down I can't imagine them every finding another investor in the world who would touch this place with a barge pole?

The Dean

HSBC report on its way............... remind me of your personal e-mail address...........

typical

You have mail... thanks man...

IndieG

I almost missed this gem.... Dubai or not Dubai, that is the question:

Quote


More bad news comes from Dubai, where property prices are looking so shaky that government-run DIFC Investments has decided to buy it, attempting to prop up the price of the Emirate’s one abundant natural resource, land. Where they’ll get the money for this feat is anyone’s guess, because Dubai Inc. faces rising borrowing costs on international markets. It seems only a matter of time before Abu Dhabi is presented with a critical question as to whether it needs to bail out Dubai or just come in and buy it at cents on the dollar.

The question for Abu Dhabi will be similar to that the US Congress just faced: is Dubai’s financial industry too big to fail? In other words, does the UAE stand to lose more from the insolvency of Dubai’s financial institutions than it does from clearing out the excess leverage and having the country’s healthier banks buy up the assets at discounts? Abu Dhabi, unlike the US, is flush, so the risk that the country would have to sell off the banks to foreign investors is low. And Abu Dhabi will pay less to buy such distressed assets than it would to recapitalize the banks as they are.

The risk, however, is that if Abu Dhabi does not step in with capital to fund Dubai and its banks, that Dubai will tap its newfound connections in Japan and China, who would love nothing better than to get a piece of the action in the Gulf. The problem for them, of course, is that what they really want is oil, not real estate. So unless buying up Dubai assets somehow brings them closer to crude, Asia’s cash-rich governments may not have so much interest in Dubai. Perhaps Russia represents a source of easy financing for Dubai.

Some say the bailout by Abu Dhabi is already underway. The UAE central bank’s liquidity facility largely funds Dubai’s refinancing needs, they point out, not Abu Dhabi’s and therefore represents a bailout by cash-rich Abu Dhabi of cash-strapped Dubai. But I don’t believe it’s accurate to count the UAE’s reserves as Abu Dhabi’s. Most Abu Dhabi income gets funneled into the Abu Dhabi Investment Authority, the Abu Dhabi Investment Council, the International Petroleum Investment Company, and Mubadala Development. Until those funds start buying Dubai assets, I wouldn’t call it a bailout

Unquote

http://www.thenational.ae/article/20...35553/-1/SPORT