LONDON
London has seen a strong start to the year and we expect this to continue through 2011. Central London will continue to lead the pack in terms of growth, due to its close relationship with the financial services sector and high global demand. As overseas investors now account for 48% of all prime central London property purchases, London remains the primary overseas property investment market. While the volume of buyers remains consistent in the market, a lack of supply and mortgage financing could mean a lower number of transactions over the forthcoming months. Rents are at an all-time high; the combination of a severe lack of stock and very high demand fuelled 16% price growth last year and is likely to persist this year. The UK base rate is at a record low of 0.5%; however in the coming months this position may change. The prospect of higher borrowing costs could affect demand but this should be limited as any increase is likely to be minimal.

JERSEY CITY
Jersey City is a dynamic commercial centre located just seven minutes from Wall Street. Capital values are 50% below peak prices achieved in January 2007, offering investors the opportunity to enter the market at a low price point. The advantage Jersey City has over Manhattan is strong yields as its average property price is just one fifth of Manhattan’s and its property taxes are significantly lower, making the area an interesting investment. Jersey City also benefits from having among the best transport infrastructure in the United States. The PATH train runs 24/7, making the commute from Jersey City to Wall Street only seven minutes. Therefore rental demand is strong in the area, especially from people working in Manhattan and looking to benefit from Jersey’s larger property sizes and lower monthly rents. The improving job market means demand will rise as tenants seek to upgrade their homes. Capital values are likely to appreciate over the course of the year as supply is outweighed by current demand. REITs have also shown their confidence in the Jersey City market; CB Richard Ellis Realty Trust, a non traded REIT, bought Jersey City’s Colgate Center in a deal valuing the twin office buildings at $310 million.

KUALA LUMPUR, MALAYSIA
Following 7.2% economic growth in 2010, the residential market saw optimism reflected in higher prices in Q1 this year. The government is continuing to implement the Economic Stimulus Package throughout 2011; which will only encourage the economy to grow further; this will have a positive impact on the property market. The proposed billion ringgit Mass Rapid Transit (MRT) project will be a catalyst for growth in many areas running alongside the proposed lines as well many suburbs of Kuala Lumpur. Kuala Lumpur continues to be one of IP Global’s top picks as its property market is expected to remain strong throughout 2011. We estimate 7-10% growth of capital values in Kuala Lumpur on the back of strong economic growth and ongoing high transaction volume from 2010.

TURKEY, ISTANBUL
Turkey has the fastest-growing economy in Europe, a trend that is likely to continue in the near future. Factors such as a small budget deficit, a stable banking system and a capable government have all contributed to making Turkey an attractive investment opportunity. The volume of sales to foreigners rose by 40% in 2010, a figure that can be reflected in the recent growth in the construction sector; construction grew by 18% in 2010 and is forecasted to increase by 10% this year. Given Istanbul’s renewed confidence, high transaction volumes, and economic stability, we believe it has a largely untapped market that holds great growth potential. The city won European City of Culture 2010, which will spur a huge amount of investment into the city in the coming months.

AUSTRALIA
Following extensive property damage from extreme weather late last year, Australia’s residential market had a weak first quarter prompting questions whether this could be a signal of a weaker year ahead. Many parts of the country have been struggling to recover since the flood disaster in 2010; for example, sales in Queensland fell by 13.3% in February this year. Sales for multi-home dwelling developments fell by 7.6% last month, while detached houses saw a 1.5% decrease in values. Tighter lending conditions with interest rates on hold with a bias to increase, and a lack of government action towards housing policy suggest Australia’s residential market will have a difficult year.

DUBAI
Recent data suggests Dubai is not yet close to the bottom of its market depression after property prices fell 65% in 2010. The market could fall up to 30% further over the next two years as new supply is expected to come on the market. There will be 42,000 new property units completed come 2013, increasing supply by 12%, leading the market to inevitably devalue and result in disequilibrium.