Every week, The Real Deal rounds up the biggest real estate news from around the globe.
The falling pound, which hit its lowest level in two years, could make property in the U.K. more attractive to foreign buyers. The currency has shed about 2 percent of its value since Prime Minister Theresa May announced her resignation, and now, currency markets anticipate the Bank of England will lower interest rates to boost the sluggish British economy. Boris Johnson, the front-runner in the race to replace her, may support a no-deal Brexit, a move that could also see ripple effects in the economy and beyond.
A London flat once owned by Artemis Onassis, sister of billionaire Aristotle Onassis, hit the market for the first time in nearly 30 years, according to Mansion Global. The asking price is £25 million, or $31.2 million, for the five-bedroom property on Grosvenor Square in the upscale Mayfair area of London. Wetherell is the listing broker for the property, which hit the market last month. It is believed that Onassis owned the flat in the 1960s and ‘70s. [Mansion Global]
While Brexit hangs over the British housing market, rents in the United Kingdom are rising at their fastest pace in two years, PropertyWire reported, citing data from private banking firm Kent Reliance. In London, rents are at their highest since 2015. The value of the private rented sector in the UK rose by £6 billion, or $7.5 billion, in the last 12 months as rental inventory growth slowed and home prices fell. [Property Wire]
Two leading commercial banks in Hong Kong reduced their valuation of pre-owned homes in several areas by as much as 3.6 percent. That could leave some homeowners underwater, with mortgage loan balances that exceed their property value, according to the South China Morning Post. HSBC and Bank of China reduced used-home valuations in New Territories and Kowloon after massive street protests over a controversial extradition measure erupted there last month. JLL on Tuesday published a forecast that the median home price in Hong Kong will decline by 5 percent in the second half. Knight Frank issued a similar forecast in May. This comes a greater slowdown in Chinese firms investing overseas. The pullback by Chinese investors in the U.S. and European markets followed restrictions imposed by the Chinese government. [SCMP]
Chinese millionaires — once one of the largest foreign investment groups in U.S. real estate through residential and commercial purchases and the EB-5 cash-for-visa program — are disappearing. The number of Chinese millionaires fell 5 percent to 1.2 million last year and the value of their financial assets declined by $500 billion, Paris-based consulting firm Capgemini SE reported. The report is a sign that the slowest economic growth in 25 years is pinching the wealthiest segments of Chinese society. That financial setback for Chinese millionaires was a major factor in a $2 trillion drop in personal asset value last year among the richest people in the world. [WSJ]
Trust companies in China’s shadow-banking industry that finance apartment, factory and highway construction are seeing more than 280 billion yuan —$40.7 billion — at risk of default, the Wall Street Journal reported, citing Moody’s. Though that accounts for only a fraction of the sector’s total assets, it’s a 90 percent increase from a year ago. Clients are facing difficulties refinancing because of a restriction on nonbank lenders. Nonbank lenders in the U.S., meanwhile, are boosting their mortgage lending, using credit lines from some of the country’s biggest financial institutions. [WSJ]
British billionaire James Dyson bought the highest-priced apartment in Singapore, where his company plans to manufacture electric cars, Reuters reported. He is among the more than 2,500 billionaires worldwide as of last year, including more than 700 in the U.S. and 100 in New York City. Dyson reportedly paid S$73.8 million, or $54.2 million, for the three-story, five-bedroom penthouse with a 600-bottle wine room atop the tallest building in Singapore. Dyson, the 72-year-old inventor of the bagless vacuum cleaner, has attained permanent resident status in Singapore, according to media reports. A Brexit supporter, Dyson in January announced a relocation plan that would move the headquarters of his company from Britain to Singapore. [Reuters]
The parliament of Portugal passed a new law that provides citizens a legal right to housing. The progressive action has no equivalent in the U.S. For the Democratic presidential candidates’ debates last month, housing policies varied dramatically, but no one was pushing for a similar concept. Under the Basic Housing Law, the Portuguese government serves as “the guarantor of the right to housing.” The law requires the government to present its inaugural national housing policy to the parliament next year and to include special protections for the old, the young, people with disabilities, and families with young children. The new law is a legislative response to a lack of affordable housing in Lisbon, the capital, and in other parts of the country. [CityLab]
Traffic congestion and rising rents are creating new opportunities in large Latin American cities to build tiny, centrally located apartments as small as 10 square meters – about the size of a vehicle parking space. So-called mico-apartments are also gaining popularity in the U.S., though its version of micro is substantially larger. In Chicago, developer Cedar Street Companies advertises studios measuring less than 300 square feet each. In Brazil, architects are designing micro-apartment buildings with expansive common areas for socializing. Tenants “sleep in their apartments, but the rest of the building is part of their house, too,” The Brazilian project is legally required to have units that measure at least 11 square meters. Similar projects are under way in middle-income and upscale neighborhoods in Buenos Aires. [BBC]