London Houses for Rent

Secondary financial centres are feeling a chill too. Here is a snapshot from four different markets.

Dubai
The business hub of the Gulf region is seeing a slowdown in its construction boom as lenders rein in financing. Estate agents who deal in the upper end of the property market are now worried about shrinking investment as banks make it harder to get mortgages and wealthy Europeans and Asians curb their appetites for property purchases.

“It’s not surprising to see individuals cutting back on real estate investment. We can probably expect that to continue until stock markets settle,” says Jan Dabrowa of Dubai Properties Group.

Prices on both sales and rentals in the emirate have remained steady until now. But if the financial crisis worsens in the west they are widely expected to start falling.

Moscow
In the Russian capital, wealthy oligarchs have long propped up the high-end real estate market. But agents are now getting nervous. The Russian stock market has plummeted since June and in August the rouble suffered its worst monthly decline for more than nine years.

Would-be billionaires are too busy covering their professional concerns to consider property purchases. And yet, even as developers cancel projects, the supply of new housing units continues to grow, by 2.1 per cent in September to about 27,400 listings, with many more new high-end condos still set to open.

Natia Ratishvili, an estate agent at Knight Frank in Moscow with nearly a dozen properties priced above $4m on her books, says enquiries have fallen considerably in the past few weeks.

“One buyer agreed to put an offer in on an $8.6m apartment and then pulled out as the stock market started falling,” she says. “He really panicked and changed his mind at the last second and we’re beginning to see more and more of this behaviour.”

Singapore
The malaise in this city-state (pictured right) has spread from the lower and middle end of the market to high-rise condominiums and white-glove communities in exclusive districts, say brokers. Prices on properties valued at $3m or more – the luxury segment – have been reduced by 1020 per cent in just the past few weeks, according to data compiled by the Singapore Association of Estate Agents.

“The financial sector and the jobs that come with it are critical parts of the property market,” says Leong Wai Ho, an economist with Barclays Capital. “With the current economic climate, residential property prices could fall by up to 30 per cent over the next two years.”

Zurich
In the old-money Swiss city, headquarters for UBS, one of the European banks hit hardest by the credit crunch, there is also increasing gloom.

Estate agent Adrian Bratschi, who works in Küsnacht, a suburb popular with finance executives, says nearly half a dozen clients have pulled listings off the market over the past two weeks. “Some [people] are a little afraid, even if the crisis doesn’t directly affect them,” he says.

Article written by Troy McMullen

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