“Large rate increases from 2023 have mostly subsided for the broader market,” the New York-based insurance brokerage firm said in the report. “Rates are flat to up 10% for both natural catastrophe (CAT) and non-CAT property with minimal loss history and good risk quality.”

Widespread double- or triple-digit rate increases seen in 2023 have largely subsided for the broader market, USI reported, and most renewals “have seen single-digit increases, with some shared or layered placements seeing rate decreases due to the replacement of more expensive capacity from 2023.”

Commercial Property Insurance Trends

In the report, USI listed reinsurance market stabilization, expanded capacity on shared and layered programs, intensifying wildfire woes and updated catastrophe models that may impact insurer appetite or pricing as trends to watch in the second half of 2024.

On the catastrophe model point specifically, the insurance industry is awaiting potential pricing and capacity impacts following new releases from Moody’s RMS and Verisk, the report said. Both platforms included updates to the hurricane models for the U.S. Verisk is scheduled to release an additional update to its Wildfire model this month.

“The areas expected to be most impacted by the new hurricane models include the Gulf Coast and the Southeast, with average modeled losses expected to increase anywhere from 5% to 10%, and as high as 20% to 30% for certain portfolios,” the report said. “Insurers, reinsurers and state regulators are testing their current versions against the updated hurricane models to determine portfolio impact, potential pricing adjustments, additional surplus required and capacity needs.”

USI also noted that captive interest continues; the total number of captives worldwide increased from 5,879 in 2020 to 6,181 in 2023. That uptick was driven mostly by property insurance market conditions, USI said.

Commercial Casualty Insurance Trends

In the casualty insurance sphere, USI reported that the rate and pricing environment for workers compensation remains competitive in most states. Mental injury claims and catastrophic injuries were listed as trends to watch in the next six months.

“Broadening the criteria for compensable mental injury claims may lead to an increase in their frequency, severity and adjustments in WC insurance premiums overall,” the report said. USI later added that insurers are “closely monitoring” catastrophic injuries and could adapt their underwriting if they increase.

And, while USI described the GL/products market as “still challenging,” more flat renewals are being seen in some industry segments, the report said. Real estate and habitational risks “continue to be challenging to place, and insurers willing to cover the risks are typically increasing rates from high single digits to low double digits,” USI reported.

The report also shared that litigation is prompting the reassessment of approaches to per- and polyfluoroalkyl substances (PFAS) underwriting, coverage, risk management and claim handling.

“Most insurers are mandating exclusions on all renewal accounts regardless of industry or exposure to loss, but especially manufacturing, hospitality, retail and owners of real estate,” the report said. Along these lines, USI anticipates that finding PFAS coverage in the environmental insurance marketplace will be more difficult for product exposure, including supply chain/distribution risks and site-specific risks.

Source: Insurance Journal

The post Commercial Property Insurance Market Proving More Stable, Capitalized: USI appeared first on Amora Escapes.

The law, which took effect in January, bans foreigners from buying residential real estate for two years. It was designed to help Canadians access more housing by halting competition from outside the country.

But industry and legal experts say the law has inadvertently ensnared commercial property deals involving land, malls, grocery stores and office buildings that do not include any single-family housing.

That is because the law’s definition of residential property includes land that is zoned for residential use or mixed use, which covers huge swaths of commercial land across the country. As well, an entity is deemed foreign if a non-Canadian owns a minimum of 3 per cent of the entity.

“A lot of players, all of a sudden, are out of action,” said Kevin Lee, the head of the Canadian Home Builders’ Association (CHBA), which represents about 9,000 construction companies including land developers, trade contractors, homebuilders and manufacturers.

Mr. Lee estimates that hundreds of commercial real estate transactions have been scuttled so far. “These deals are falling through on a daily basis,” he said.

One residential developer, Dorsay Development Corp., has had to put part of its business on hold. For 25 years, it has been constructing condo units and townhouses in the Toronto region. Like other developers, it buys land to build new housing units. But the Canadian-based company is owned by a European investor.

Leona Savoie, Dorsay’s senior vice-president of residential, said she has had to pass on dozens of potential properties. “My investment opportunities have dried up,” said Ms. Savoie, who has analyzed all the sites she has considered and found that the vast majority are zoned for mixed use or residential.

Ms. Savoie said her inability to buy more land has created a “big roadblock” for Dorsay’s future plans.

Foreign entities are allowed to buy larger apartment buildings that have more than three dwelling units. They are also allowed to purchase commercial real estate that is zoned for mixed use and residential as long as the property is not in an area that has a core population of at least 10,000 people. However, this has caused some deals to be scaled back.

For example, a U.S. fund was trying to buy a portfolio of grocery stores across Canada. But because some of the grocery stores were located on land zoned for mixed use in the larger urban centres, the buyers had to eliminate the larger stores, said lawyers working for the fund.

“Anything in a major urban centre is getting knocked out,” said Paul Morassutti, a partner at Osler law firm and chair of its national real estate group. “It’s commercial property. They are grocery stores and will continue to be grocery stores. It has nothing to do with housing stock in Canada,” he said.

The Prohibition on the Purchase of Residential Property by Non-Canadians Act was unveiled in the federal budget last April when home prices were near their peak and buyers were still able to qualify for a large mortgage. Since then, the Bank of Canada has continually raised the cost of borrowing. The volume of home sales has dropped by at least 40 per cent and national home prices are down 19 per cent.

Mr. Lee said his lobby group has been talking to policy makers who helped craft the law, including in the ministries of finance and housing, as well as at Canada Mortgage and Housing Corp. (CMHC).

Mr. Lee said he has gotten the impression that they did not intend for the rules to curtail commercial real estate deals and development. “We do get the sense that they’re working on trying to make some adjustment,” he said.

The details of the law were unveiled late December, just days ahead of the Jan. 1 implementation.

The federal government said it was closely monitoring the implementation and impact of the law.

“We will continue to engage with stakeholders as we consider potential additional steps to ensure this measure does not have unintended impacts on communities,” said Leonard Catling, a spokesman for CMHC. The housing agency led the consultation process for the new law.

source: theglobeandmail

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The property firm is looking to transform a 8.6-acre parcel of agricultural land to the north of Windsor Drive in South Hetton into a residential development with a mix of two, three and four bedroom bungalows and houses.

Originally, the application had comprised 106 homes, however the number has been reduced.

As part of the proposal, amenity open space would be provided primarily to the north west and along the northern boundary of the scheme, with a further smaller area of open space in the south east corner.

A planning report, which will be scrutinised by County Durham Area Planning Committee (Central and East) on Tuesday 14 February, said that the plans would “bring a number of social and economic benefits directly to South Hetton and the surrounding area”.

Specifically, 84 direct jobs and 164 indirect jobs would be generated from the project, while the site is set to create spend in the region of about £6.8m – directly from building activity.

The report concluded that the scheme provides a “sustainable development opportunity that would contribute to the provision of a mix of housing size, types and affordability in the area”.

It added: “The proposals aim to deliver quality new homes to local people in addition to providing much needed new housing in this location.”

The application will go before the council with the recommendation for approval.

source: insidermedia

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But unlike the vast majority of his generation, the Columbus, Ohio-area resident actually used that information. Just 2% of people born from 1997 to 2012 participated in the buying and selling of property in 2021, according to a National Association of Realtors estimate.

Not only did Castellanos participate in the market — he made money off of it. Last year alone — while finishing his bachelor’s degree in finance at Miami University in Oxford, Ohio — he earned $152,021 through six deals, documents that Insider verified show.

“Real-estate stuff is everywhere,” he told Insider. “When you start talking about investing you’re going to talk about real estate, because that’s probably the best thing to invest in.”

Starting a business before 21

When he was 20, Castellanos and his then 18-year-old brother, Jason, maxed out a couple of credit cards to take a $6,000 course focused on how to invest, hosted by real-estate consultants at FortuneBuilders, the elder brother said.

The duo began what they called “wholesaling” houses, which involves participating in the purchase of a property without actually taking ownership, as house flippers do. In a typical wholesale deal, the wholesaler enters a sale contract with a homeowner, then assigns that contract to an investor at a higher price and pockets the difference, according to Investopedia.

The brothers completed their first wholesale deal in Ohio during the winter of 2021 and made $1,500 — money that was reinvested along with their savings into their business. They scored $52,000 when their second wholesale deal closed, Castellanos said.

He said they funded their business without any financial help from their family.

Castellanos flipped his first house in Dublin, Ohio, last year in partnership with Austin Rutherford — a 29-year-old real-estate investor who also began his career as a flipper.

He said he raked in $27,000 in profit on that property and expects to do even better this year despite the housing market slowing. He projects his annual income as CEO of Innovate Property Solutions should grow to $300,000 as he pivots from wholesaling to more fix-and-flip projects, which are more lucrative but require more capital. He now runs his business solo.

“It is about knowing multiple exit strategies,” he said. “I see people that are just wholesaling right now, and some of them are getting their butts handed to them because that’s all they can do. I’m flipping everything right now because it’s just higher-margin.”

On top of that, he said, the slowing market cuts both ways.

“What’s cool in our business is we’re on both the buy and sell ends,” he said. “So that means we get to buy things for less too.”

Gen Z is catching the real-estate bug

Gen Zers like Castellanos — once reluctant to invest or just unable to get a start — are getting amped to participate in the real-estate market in 2023, a recent survey found.

The November 2022 survey, which was conducted by the online investor marketplace New Western, included responses from 886 adults who have purchased or plan to purchase a property through the marketplace.

New Western found that among its investors, some 86% under 24 said they were going to ramp up buying efforts as soon as mortgage rates “stabilized.” That was more bullish than the responses from all investors surveyed, according to New Western, which says it has facilitated $15 billion in transactions and connected 150,000 investors in 52 markets.

Like Castellanos, these investors are largely eyeing places in the Midwest and Western US like Columbus, Ohio; Lincoln, Nebraska; and Missoula, Montana, the survey found.

To Castellanos, it’s the access to information that has made his generation so bullish. Where a young adult in the 1980s would have to go to a library to do extensive market research, that person today can get the information quicker on YouTube, he said.

Paths to profit for young, first-time home flippers

While accessing information might encourage someone to start investing in real estate, it takes a lot more than just watching videos to make a career out of it. Castellanos swore by three things when making the leap from education to investing.

The first is to take a risk, which he called a necessary step to making money. For him, it was going into debt in exchange for the real-estate course whose outcome was uncertain.

Second, he recommends that home flippers get their feet wet by wholesaling, which to him means buying a property and reselling it without doing much work on it. This requires hustle, hitting the phones to find the best deals, he said.

Third, once you’ve established a presence in the local market, it’s important to network with people who can help finance your purchases and help rehabilitate the properties. This will be crucial later if you need to finance a project or find an honest contractor, he said.

source: businessinsider

The post According to a 22-year-old home flipper who will make $300,000 this year, college students can make six figures in real estate. appeared first on Amora Escapes.

The big rise in mortgage rates during the past year has throttled the housing market, with sales of existing homes falling for 11 straight months to the lowest level in more than a decade.

The average rate on a 30-year fixed mortgage rose to 6.12% on Thursday from 6.09% last week, according to mortgage buyer Freddie Mac. A year ago, the average rate was 3.69%.

The 15-year fixed-rate mortgage averaged 5.25%, up from last week when it averaged 5.14%. A year ago at this time, the 15-year FRM averaged 2.93%.

Mortgage buyer Freddie Mac reported Thursday that the average on the benchmark 30-year rate inched up to 6.12% this week from 6.09% last week. The average rate a year ago was 3.69%.

The average long-term rate reached a two-decade high of 7.08% in the fall as the Federal Reserve continued to raise its key lending rate in a bid to cool the economy and bring down stubborn, four-decade-high inflation.

“Following an interest rate hike from the Federal Reserve and a surprisingly strong jobs report, mortgage rates increased slightly this week,” said Sam Khater, Freddie Mac’s chief economist.

“The 30-year fixed-rate continues to hover close to six percent, and interested homebuyers are easing their way back to the market just in time for the spring homebuying season.”

The big rise in mortgage rates during the past year has devastated the housing market, with sales of existing homes falling for 11 straight months to the lowest level in more than a decade. Higher rates can add hundreds of dollars a month in costs for homebuyers, on top of already high home prices.

The National Association of Realtors reported earlier this month that existing U.S. home sales totaled 5.03 million last year, a 17.8% decline from 2021. That is the weakest year for home sales since 2014 and the biggest annual decline since 2008, during the housing crisis of the late 2000s.

source: foxbusiness

The post Mortgage rates rise after weeks of reduction. appeared first on Amora Escapes.

Submissions are invited in 16 categories and the winners will be revealed at a black-tie ceremony taking place on Thursday, 11 May 2023 at Manchester Central.

This year features a change to the category list and an update to the Game-Changer Award. For 2023, the award is seeking entries from individuals aged 40 or younger who are shaking up the property industry.

The judges are looking for the person who is seen to be a rising star in the sector, who can demonstrate that they are pushing boundaries and exploring new ways of working in order to turn ideas into reality.

Entries can come from any part of the property sector – including agents, developers, consultants, architects and more.

source: insidermedia

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Report by a global commercial real estate services and investments firm – CBRE, stated that the total volume of transactions in Dubai reached 8,662 in December 2022 – a growth of 63 per cent from the previous year. This was supported by a 92.5 per cent increase in off-plan sales and a 35.4per cent jump in secondary sales.

Dubai’s residential market saw a number of records being broken over the course of 2022. Residential transactions volumes beat the 2009 high by almost 10,000 transactions. Residential rental growth also reached historic levels, with apartment and villa rents increasing by 27.1 per cent and 24.9per cent, in 2022, respectively.

The report pointed out that average property prices rose by 9.5per cent in the year to December 2022, while average apartment prices rose by 9.0per cent. Average villa prices increased by 12.8 per cent over the same period. As of December 2022, Dubai’s average apartment prices reached $318 per sqft and average villa prices reached $377 per sqft.

These average rates have not yet surpassed the record highs of 2014, with the average apartment and villa prices being 21.5per cent and 4.2per cent below this peak. In the apartment segment of the market, Jumeirah has registered the highest sales rate per sqft at $632, whereas, in the villa segment of the market, Palm Jumeirah registered the highest sales rate per square foot at $1,067.

In the year to December 2022, average rents increased by 26.9per cent. Over this period, average apartment and villa rents increased by 27.1per cent and 24.9per cent, respectively. The Palm Jumeirah recorded the highest average yearly apartment and villa rents, with asking rents reaching an average of $67,644 and $277,000 per annum, respectively.

According to a survey by JLL, one of the primary factors that made Dubai’s real estate market perform strongly in recent years was the city’s robust economic growth and development, which has raised demand for residential and commercial real estate.

The government also enacted a number of programmes and rules to encourage foreign investment in the real estate industry, which has contributed to the market’s growth. The Dubai Land Department (2020) reported that the overall amount of real estate sales surpassed AED 257 billion.

In addition, Dubai’s image as a worldwide business and tourist centre, as well as the city’s advantageous tax laws and regulations have contributed to its success in the real estate market.

Nigerians have been known to invest extensively in the Dubai real estate market, and the figures speak for themselves. According to a study by the Dubai Land Department, in 2018, Nigerians placed fifth in terms of the number of investors in the Dubai real estate market, with a total of 1,092 transactions valued at AED 4.6 billion (approximately $1.25 billion) (Dubai Land Department, 2018). This illustrates that even if the number of transactions was not as large as in some other nations, the value of these transactions was still considerable.

In 2019, the Dubai Land Department announced that Nigerians were the second-largest group of foreign purchasers in Dubai’s real estate market, with 1,824 transactions worth AED 7.2 billion (approximately $1.97 billion) (Dubai Land Department, 2019). This is a considerable rise in both the number of transactions and the overall value of those transactions compared to the previous year. These data illustrate that Nigerian investment in the Dubai real estate market is not only considerable but also expanding.

Currently, apartment sales in Dubai are driving the market. Nonetheless, demand for villas and townhouses remain robust. Location, pricing, and amenities may also influence the desirability of various housing styles in the city. Most of properties are also used for multiple use and holiday services.

Real estate experts, especially estate surveyors and valuers, said Nigerians are drawn to the Dubai real estate market owing to its security and being a stable place for investment, the city’s developing status as a worldwide business and tourist centre and the comparatively cheap cost of property compared to other large cities.

The Director, School of Environmental Studies, Moshood Abiola Polytechnic, Ogun State, Dr. Samson Agbato, said: “One factor is the impression of Dubai as a secure and reliable place for investment, which is particularly tempting to Nigerian investors who may be searching for a shelter for their capital.

“ Additionally, Dubai is renowned as a worldwide commercial and tourist centre, and as such, it provides numerous options for Nigerian investors wishing to invest in a city that is not only stable but also developing.”

Agbato, an estate surveyor and valuer also traced the appeal of the Dubai real estate market to the comparatively inexpensive cost of property in Dubai compared to other major cities. “This may make it more cheap for Nigerian buyers to acquire property in Dubai, which in turn leads to better returns on investment,” he said.

He said: “Wealthy Nigerians may be drawn to Dubai real estate investments due to the city’s robust economy, stable political atmosphere, and cutting-edge infrastructure. In addition, Dubai’s prominence as a worldwide business and tourist centre may make it a desirable real estate investment location.

“The city’s tax-free status and absence of limits on foreign property ownership may potentially attract affluent Nigerians. In addition, Dubai’s real estate market is renowned for its strong returns on investment and potential for capital gain, making it an appealing location for international real estate investors.”

The Secretary, Association of Capital Market Valuers (ACMV), Ademola Adetola, said the depreciation of the naira has made high-net-worth Nigerian investors find Dubai as a safe haven.

“Nigerian investors are very significant because of the continuing depreciation in the value of the naira. Informed investors want to forestall value losses in their portfolio and capitals,” he said.

According to him, “the city’s real estate has continued to remain stable and steady, defying global markets slow down and recession trend. Factors such as the recent pandemic, rising taxes, cost of living crisis, natural disasters and the ongoing Russia-Ukraine war, amongst others have tended to push many citizens looking for safety of their families and businesses to migrate to Dubai, which has remained number one destination for high-net-worth migrants.

“Dubai is attractive because the city offers world class educational institutions, healthcare facilities, security and high levels of home ownership among its residents. The city offers one of the best value in global markets for investors, according to the UBS Bubble Index.”

Adetola said the city is less exposed to high interest rates because of the prevalence of cash buyers estimated at more than 70 per cent of purchases (according to Better Homes data) and the city has continued to benefit from higher oil prices, which is currently key driver of global inflation.

Besides, the international nature of the market, he said, making values and prices of properties to rise in the city, yielding a 6.5per cent average rental returns in contrast with situations of meltdown in most other parts of the world.

The Principal Partner, Emeka Okoronkwo & Associates, Emeka Okoronkwo, stated that investments, especially economic are mostly attracted by established and reliable structure. “That is what determines its ability to yield expected returns. The Dubai concept was well thought out, all the funnels that will continue to generate traffic to support and yield expected returns in their real estate sector are functional.

“They have created a world tourism excitement centre with a supportive airline and visa regime and a time-share property ownership structure. A large amount of those investments are from Nigerians, as they retain value over time. It yields adequate returns and offers them a lifestyle they can access in a less difficult way compared to Europe or America,” he added.

source: guardian

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He adds that the new owner might “sub-divide and redevelop the freehold plot into three detached homes” subject to approvals. Since the site is elevated, the new development would be able to enjoy views of the surrounding landed estate.

“Landed private homes continue to be among the most coveted real estate properties in Singapore due to their scarcity, exclusivity and prestige. Freehold properties are also seen to be a good store of value,” says Lim. “Given the steady demand for such homes, we expect landed home prices to remain resilient this year.”

source: edgeprop

The post Braddell Heights freehold bungalow sold for $19 million appeared first on Amora Escapes.

This is according to FNB’s senior economist for commercial property, John Loos.

Speaking to RSG Geldsake this week, Loos said that South Africa’s property sector has experienced low house-price growth or commercial valuations that did not keep up with inflation and, in real terms, this resulted in a long slowdown.

He said only once the correction ends would it be a good time to buy property.

“In terms of investment in the commercial property sector in South Africa over the past five years, we have been on the weaker side when compared to elsewhere,” said Loos.

“When it comes to residential, for example, FNB home-price growth never went much above 4%, but the US sometimes swung into double digits during the period of lockdowns.”

He said that South Africa had faced long-term economic stagnation, and since 2012, there has been a broad slowdown. And despite significant anomalies such as the pandemic, the country is still experiencing stagnation.

Loos said that significant economic policy changes are required for the property sector to be turned around in the years to come.

“Policy will change; the private sector will be allowed to have a larger participation in many sectors, such as electricity, and then we could perhaps see the best part of the decade ahead perform significantly better economically, and property can turn around,” Loos added.

Recent data from property research firm Lightstone supports Loos’ assessment.

Lighstone said that residential property would continue to be shaped by local and international challenges; however, a stagnating domestic economy will be the toughest challenge.

The group said that the economy’s stagnation would see prices grow at a rate lower than inflation. Out of all three predictive forecasts, from baseline to positive, further interest rate hikes are expected – ranging from 50 basis points to 200 and GDP growth no higher than 1.1% in the most conducive scenarios.

Further rate hikes would hit home, making it harder to pay off monthly bond repayments.

When looking into the property market during a high inflationary period, Grant Smee from Only Realty Property Group said that it is best to look to buy at 70% – 80% of your affordability – thus ensuring a buffer for potential increases in rates, costs of ownership, taxes and levies.

source: businesstech

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Real estate developers anticipate a contraction in home sales and a brake on rising prices over the next three months, but are confident in the capacity of the residential market, according to the Portuguese Investment Property Survey, conducted by Confidencial Imobiliário and the Portuguese Association of Real Estate Promoters and Investors (APPII).

“Despite anticipating a contraction in housing sales and a brake on price rises for the next three months, real estate developers remain quite confident in the capacity of the residential market”.

According to the latest survey, “the number of developers with new projects in the pipeline increased to 74%, a share similar to that of respondents who say they are actively looking for land for new developments. In any case, this is a record level in terms of investment intentions”.

However, in the context of loss of purchasing power on the part of Portuguese families, respondents reveal the “lack of demand as the last obstacle to their activity”.

“With a pressure index of just 26% (on a scale of 0 to 100%), since mid-2021 this is no longer a concern for these agents”.

Even so, there is the prospect that the market will slow down in the short term, “with expectations regarding the evolution of sales in the 1st quarter of 2023 to be positioned at -57 points”.

“It is the third consecutive quarter in which this indicator is in negative territory, but it is the first time, since the pandemic, that simultaneously generates expectations of a brake on price growth, with an indicator at -2 points. That is, the percentage of promoters that point to a drop in prices exceeds by 2% those that point to a rise”.

Source: theportugalnews

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