The Landed Newsletter No. 35, September 2018

Welcome!

In Landed Newsletter No. 35, restrictions on foreign buyers in Malaysia and New Zealand, market-cooling measures in China and South Korea, more market data in Canada, higher mortgage rates in Hong Kong and much more.

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The Landed Newsletter highlights news and resources that you can use to make better real estate decisions, whether you are buying, renting or investing. With a focus on Asia and the Pacific Rim, The Landed Newsletter covers trends, legal and environmental developments and technology.

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Market News

Canada

In a landmark decision, the Supreme Court of Canada will not hear an appeal from the Toronto Real Estate Board, which wants to keep sales data private. The decision is expected to make more market data available to consumers throughout Canada.

The Canadian media is beginning to report on people who bought at the top of the market and now have negative equity, like this couple who are waiting for the completion of a home that continues to fall in value.

A proposal for a luxury highrise condominium in Vancouver was scrapped, in a sign that the city's property market is cooling. The project is being developed by the Mainland-based Brilliant Circle Group.

Sidewalk Labs released previously-secret details of its development agreement with the city of Toronto and unveiled designs for the project, which is supposed to turn a barren piece of waterfront land into a smart city.

China

Shenzhen introduced further market cooling measures, including restrictions on homeowners selling their property within three years of the purchase date and restrictions on loans to recently divorced people.

The central government forced developers in two cities in Hainan to cap and lower property prices. Sanya and Haikou saw month-on-month price increases of 19% and 16.5%, respectively, in July.

Two construction companies in Zhejiang Province are under investigation after they were found to be using concrete made from radioactive granite to build homes.

Hong Kong

For the first time in a decade, mortgage rates in Hong Kong rose. Four major lenders raised rates for new mortgages by 10 basis points and more increases are expected as the U.S. Federal Reserve continues to normalize rates.

All land in Hong Kong, except the land under the Anglican Cathedral in Central, is leased to users by the Hong Kong government. In August, a remarkable story emerged about how in 1999 the U.S. government arranged a 999-year lease for the site of its consulate in Central for HK$44 million (US$5.6 million). The story was broken by shareholder activist David Webb.

After the Foreign Correspondents' Club hosted a speech advocating independence for Hong Kong, the territory's former chief executive, Leung Chun-ying, called for the lease on the Club's premises to be made public. The FCC leases a heritage building from the Hong Kong government, and Leung's comments were seen as an attack on freedom of speech. It is optional for leases to be entered into Hong Kong's Land Registry and made public. (Disclosure: I am a member of the FCC.)

Indonesia

A series of earthquakes rocked Lombok, killing 555 people. Most of the fatalities were on the northern part of the island.

Japan

After long delays because of severe soil pollution at its new site, Tokyo's iconic Tsukiji fish market will open at its new home in Toyosu in October.

Mainland Chinese immigrants to Japan are settling in suburban danchi (public housing estates) including one in Kawaguchi, where they represent more than half the population.

South Korea

The government announced new measures to cool Seoul's overheating property market, including tighter loan regulations.

Malaysia

Prime minister Mahatir announced that foreigners would not be granted residence permits to live in the Forest City project, which is being built by Mainland-based Country Garden Holdings. Located on reclaimed land near Singapore, the embattled project has been marketed to Chinese buyers. Forest City was expected to house some 700,000 people and it is unclear if foreigners will be able to buy units in the development.

New Zealand

New Zealand's parliament passed a law banning nonresident foreigners from buying existing homes. People from Australia and Singapore are exempt from the law.

Singapore

Many of Singapore's homes are reaching the half-way point in their 99-year leases. That's causing anxiety among homeowners, who see the value of their dwelling declining.

Trends and Ideas

Aboriginal land claims

Native Lands is a website that lets you zoom in on maps of North and South America, Australia and New Zealand to see which indigenous groups occupied and my have claims to land in these areas.

Artificial Intelligence

Tel Aviv–based Skyline AI has raised US$18 million from leading venture capital firms to finance the development of a machine learning platform that Skyline says will help institutions make better real estate investments. Skyline has a proprietary dataset of 130 sources, some of which go back 50 years.

Home prices

The Economist's quarterly home price survey shows that Hong Kong remains the most overvalued market, at 94% over rents. Singapore and Tokyo are under-valued by 3% and 8%, respectively.

Manufactured housing

Katerra, the U.S. startup that attracted nearly a billion dollars in funding, is struggling with production delays and quality control issues.

Research

U.S. real estate company Trulia has released an app that provides detailed information—including photos, statistics and editorial materials—about individual neighborhoods, to help people decide where to live.

Security

Researchers have proposed a way to attack internet-enabled appliances, like water heaters and air-conditioners, and use them to overload and compromise the electrical grid. A separate group of researchers has discovered critical vulnerabilities in software used to manage and measure traffic, floodwaters and radiation levels that could be used to create panic attacks to paralyze cities.

South Africa

The South African government withdrew a bill enabling the expropriation of farmland. The controversial bill was intended to correct racial imbalances in land ownership.

Taxes

The Economist looks at the advantages of at the advantages of the a land-value tax.

Landed News

Christopher Dillon and James Ross at RTHK studios in Hong Kong

I was interviewed by James Ross on RTHK Radio 3's "The Morning Brew" on August 1. We coverered a lot—including the Hong Kong, China and Japan markets—as well as some pointers for making smart real estate decisions. You can stream the interview here.

Landed Japan is now part of the official collection of Japan's National Diet Library.

Limited tickets are available for my September 3 luncheon presentation for the Swiss Chamber of Commerce in Hong Kong.

Tokyo-based blogger and executive recruiter Mark Pink published a review of Landed Japan. The review covers the book's first edition, but will be useful for anyone looking for a local perspective on the Tokyo property market.

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Landed Newsletter No. 35 was published on August 31, 2018.