Japan's Property Market Set for a Boost from Echo Boomers

The property market in Japan is set to be boosted by so-called echo boomers, who are the children of baby boomers, many of whom are taking out their very first mortgages. It's the ideal time to do so as mortgage rates are nearly at a three-year low, and it is estimated around 15% of the population, or 19.1 million people are aged between 35 to 39, or 40 to 44. When these two groups are combined they give a population size that is double the post-war baby boom generation.

The boost to the economy can't come too soon, as the housing market accounts for around 15% of Japan's GDP, and the country is still struggling to recover from last year's earthquake. Unemployment is rising, as some companies are posting worse than expected results. Japanese buyers have some of the lowest financing costs in the world, as the Bank of Japan has held rates at near zero for the past 17 years.

Japan's housing starts rose 2.6% last year to reach 834,117 units and this has boosted mortgage sales for the first time since 2007. Mortgage sales increased 44% to reach ¥2.61 trillion last year, after the government introduced fixed rate mortgages.

New housing starts reached their third highest level in Japanese history in 1987 when baby boomers first became old enough to buy their homes. Homebuyers aged between 35 and their mid-40s represent a 44% share of the market, and the Japanese really are a nation of homeowners, as around 86% own their own home.

New Zealand Government Introduces New Bill to Ban Foreign Companies from Buying Rural Land

The New Zealand government is looking at introducing a new bill into Parliament which would prevent foreign companies from buying up rural land, and is due to controversy over Chinese companies trying to purchase lucrative dairy farms on the North Island.

The Chinese company, Shanghai Pengxin had put in a bid to purchase 16 dairy farms in Crafar on the North Island, and this bid had already received approval from the government before being overturned in the High Court. The bid was overturned as the High Court felt any potential benefits must be measured against an alternative buyer.

Labour leader David Shearer wants the law to be changed so governments reject any foreign bids to purchase New Zealand farms unless the bid would result in more exports, and more new jobs being formed than from a New Zealand bid.

Such a law would mean most bids to buy New Zealand land would be turned down, and only those implementing new technologies or introducing new products would be allowed. Although the government already has the power to turn down sales of farms to overseas buyers the Labour leader doesn't think it is being properly implemented, and that most sales result in profits flowing out of the country.

Selling farms to overseas buyers is also likely to raise the price out of reach of native farmers which would be very detrimental to the country.

At the moment any decision by the Overseas Investment Office to sell property to foreigners has to be approved by two government ministers who are able to decide which factors are relevant to the sale. If the new bill is made law it will be much stricter.

New Report Finds Nearly One Quarter of US Homes Are in Negative Equity

A new report from CoreLogic says that 22.8%, or 11.1 million homes in the US were in negative equity by the end of the fourth quarter last year. This is an increase on the third quarter when 22.1%, or 10.7 million homes were in negative equity. Another 2.5 million homeowners had less than 5% equity during the fourth quarter, which is known as near negative equity.

This means the total percentage of homes in negative or near negative equity was 27.8% during the fourth quarter, up from 27.1% in the third quarter of 2011. The total debt for these properties in negative or near negative equity rose from $2.7 trillion in the third quarter to reach $2.8 trillion by the end of the fourth quarter.

The report found that Nevada had the highest percentage of homeowners in negative equity, with 61% of all mortgage properties falling into this category. The second worst state was Arizona with 48% of properties in negative equity, followed by Florida with 44%, Michigan with 35%, and Georgia with 33%.

When combined these five states have an average negative equity percentage of 44.3%, while the combined average of the remaining states is just 15.3%. The majority of homes in negative equity are at the lower end of the market and are valued at less than $200,000. Although these figures are affected by seasonal declines, it's expected this situation will take quite some time to improve. If the economic recovery falters it could mean an increase in the number of foreclosures.

Property Prices in the East End Have Increased by £800 a Month since July 2005

In July 2005 London was awarded the Olympic Games, and now with just five months ago Lloyds TSB has revealed that house prices in the area around the main site have increased by around 30% since London's successful bid.

The average home cost £268,884 last November which is an increase of £62,739 since July 2005, equating to a very nice average monthly rise of £815. In comparison homes in England and Wales have risen by 25% during the same period, which equates to a monthly increase of £611.

Prices in eight out of the 14 postal districts closest to the Olympic Park have increased by at least 20% since July 2005, with Dalston and Homerton seeing the fastest price growth as each have recorded average increases of around 55% for that time period. Shoreditch came a close second with properties increasing by an average of 47% while in comparison Stratford which is the closest to Olympic construction activity has seen prices increased by just 13%, to reach an average of £227,893.

Prices in London have increased by an average of 5.4% during the last 12 months, and just two of the postal districts closest to the Olympic sites have exceeded this increase. Prices in Dalston increased by 10.3%, while prices in Clapton rose by 7.1%, but prices in Bethnal Green fell by an average of 5.2%. In spite of the massive increases seen over the last few years the typical house price in postal areas closest to the Olympic sites is still 22% below the London average of £342,551.

The most affordable homes can be found in Plaistow where the average house costs £188,760, which is 45% below the average London price. In contrast homes in Dalston cost £359,436, and it is the most expensive site closest to the Olympics.