The FIABCI-USA Fall Business Conference “Connecting Continents” is coming up quickly.  The 2010 gathering of  local, national and international professionals is to be held in Seattle, WA, September 23-26, at the Edgewater Hotel located right on the water.  Last years conference was a great success and was held in my hometown, Denver, CO.

Why should you invest your time and money to attend the upcoming national meeting?  From my experience, in additional to receiving referral business, I have gained many new friends and expanded my opportunities well beyond my dreams.  Here are some additional reasons why you should consider joining us in Seattle:

1. To expand your business network and make connections around the world
2. To learn new ideas and best practices from speakers and colleagues
3. To set yourself apart from your competition
4. To take advantage of the membership benefit and make a marketing presentation
5. To show your clients and prospective clients how much broader your reach and knowledge are because of your FIABCI-USA involvement
6. To share your expertise, listings/services, challenges, and successes
7. To learn about Asian markets, international market risks and opportunities, foreign investment in Seattle, and to gain practical tips you can apply to your business right away
8. To make friends for life who will help you when you need it most
9. To enjoy camaraderie in our special, internationally-focused group that is small enough so you can get to know most people yet large enough so you’ll be sure of meeting new colleagues
10. Because you are invited and will be warmly welcomed!

FIABCI-USA is a chapter member of FIABCI, the International Real Estate Federation which is a non-political entity whose objective is to help its members add an international dimension to their businesses. With representation by chapters in 48 countries, with five official languages: English, French, German, Japanese, and Spanish, the professional organization represents all real estate disciplines for all properties including brokerages, property management, valuation/appraisers, property development and consulting, lawyers, insurers, architects, and urban planners.

Register by August 31st to save the most money.  Open the attachment or click here for everything you need: http://www.fiabci-usa.com/fallmeeting2010.html.

See you in September – in Seattle!

The Real Estate Jobs and Investment Act (H.R. 5901), which easily passed through the House of Representatives on July 30 of this year, will effectively make U.S. real estate trusts a more attractive investment for foreign investors. How? Simply put, the new act will double the amount that a foreign citizen can invest in a Real Estate Investment Trust (REIT) before getting hit by the costly capital gains tax.

A REIT is a specific tax designation provided to corporations that are investing in real estate. The designation helps to reduce or even eliminate the company’s corporate income taxes. In return for this perk, the REITs must distribute 90% of their income, all of which is taxable, among investors. As such, REITs were designed to have a structure for investing in real estate that is similar to the way mutual funds are used to invest in stocks. REITs may be publicly or privately held, with public REITs being listed on the public stock exchange in the same was common stock is shared.

As it stands right now, only those foreign investors who own five percent or less of a REIT are exempt from being taxed. Obviously, this cap has long stood as a bit of a deterrent for those investors who might be interested in investing more than 5%, as making a larger investment will result in a loss of money in the form of taxes.

“Under current U.S. tax law, foreign investors generally do not pay capital gains taxes when they sell stock in a U.S. corporation,” states the executive summary of the notes for the Real Estate Jobs and Investment Act. “Foreign investors with a stake in [REITs]…are taxed more heavily.”

The new bill, which was originally introduced by Rep. Joseph Crowley (D-NY), hopes to bring more equality to how taxes are charged against foreign investors. It passed in the House by a wide margin of 402-11, but it still needs to be approved by the Senate before it will go before the President for his final approval.

The primary goal of this webinar was to help determine how the Federation would go about assisting worldwide real estate markets with overcoming the devastating effects of the recession while also developing ways to prevent such a financial disaster from occurring again.

This webinar was somewhat of a follow up to an initiative that took place in June in the Ukraine, at which a number of real estate representatives met with government officials in order to determine ways to reform the real estate market on a national level. At this meeting, representatives decided to adhere to the principles that had been developed by the FIABCI in collaboration with the United Nations. A party consisting of members of the private sector as well as high-level members of the Ukraine government was developed after this meeting with the goal of developing practical reformation matters.

At the FIABCI webinar, which largely focused on the Ukraine initiative, a number of conclusions were reached. First, it was determined that the FIABCI, along with the United Nations, would take on a leadership role in terms of promotion essential regulations, global standards, economic stability, sustainable development, efficient markets and best practice. It was also agreed that maintaining an open dialogue between local and national governments was mutually beneficial. While FIABCI members will work toward improving business conditions while also gaining recognition in the industry, government bodies would benefit from the market experience and professional expertise the members have to offer.

It was also determined that the process could be expanded through the various FIABCI national chapters located around the world and that progress reports would be delivered to the members in December 2010 at the FIABCI Business Meetings in Brussels as well as in May 2011 at the FIABCI World Congress in Cyprus. Furthermore, it was determined that FIABCI-Ukraine as well as officials from the United Nations will provide assistance to the other FIABCI Chapters that are interested in establishing a similar dialogue with their government officials.

“Today’s event was a first for FIABCI with members from many of our Chapters working together towards making the international marketplace more efficient, transparent and stable,” said Enrico Campagnoli, who is the World President of the FIABCI. “The process is directly relevant to the creation of business opportunities. Meeting regularly with government at the highest level while comparing experiences with FIABCI colleagues will inevitably lead to an improved network and more transactions for those involved. At the same time, we will be making an important contribution to the long term economic health of the communities we serve.”

• The strength of the U.S. dollar
• The overall value and level of desirability of real estate in the United States
• The apparent emergence of an economic recovery

“While all real estate in the U.S. is local, the same is not true for property owners,” said Vicki Cox Golder, who is the President of the NAR as well as the owner of Vicki L. Cox Real Estate in Tucson, Arizona, in a REALTOR®Mag article. “The. U.S. continues to be a top destination for international buyers from all over the world. Foreign buyers understand the value of owning a home in this country and can rely on REALTORS® to help guide them through the complex process of buying property in the U.S. With expertise, knowledge and experience, REALTORS® have a global perspective.”

The survey analyses investor interest from April 1, 2009 through March 31, 2010, during which time foreign investors purchased an estimated $66 billion worth of residential property in the United States, representing 7% of the residential market. Those included in the “foreign investors” category include those who remain residents outside of the United States as well as recent immigrants and temporary visa holders. Furthermore, 28% of REALTORS® report having worked with at least one international client over the past year, representing a significant increase from the 23% reporting to do the same in the June report. Furthermore, the report estimates that 18% of REALTORS® completed at least one sale with a foreign buyer, compared to 12% last year.

“Several factors have contributed to an increase in international buyer interest in the U.S.,” continued Golder. “A larger majority of REALTORS® report the changes in value of the U.S. dollar have had a strong impact on the international real estate business. In addition, perceptions abroad about trends in the U.S. real estate market have led many international clients to believe purchasing a home in the U.S. is more affordable than in their country and holds more value.”

Although international buyers during the period analyzed came from 53 different countries, Canada, the U.K., Mexico and China/Hong Kong were the top four investors. In fact, 23% of foreign investors came from Canada, which has been the largest foreign investor over the past three years. Mexican investors have been on the rise, however, having replaced the U.K. as the second largest group of buyers in 2010 and holding 10% of the market. While buyers from the U.K. dropped from representing 10.5% to 9% of the market, its investors still held a strong showing. Investors from China/Hong Kong, on the other hand, represented 8% of the foreign investment market.

According to the report, there were two factors that were particularly important to international buyers who were interested in purchasing property in the United States. One factor was the proximity of the property to their home country, while the other was the convenience of air transportation. In general, Canadians, South Americans and Europeans were interested in Florida, while Europeans showed interest in the East Coast. Asian buyers were most interested in the West Coast, while Mexican buyers were primarily interested in the Southwest. While international buyers expressed interest in a total of 39 different states in 2010, the majority of interest was expressed in Arizona, California, Florida and Texas. In fact, 53% of foreign purchases took place in these states, with California and Florida being the top two destinations.

While the median price paid by foreign buyers dropped from $247,100 to $219,400, these figures are still much higher than the overall median price within the market. In fact, foreign buyers tended to purchase at the higher end of the market, with 16% of purchases being properties priced at $500,000 or more. Furthermore, while 66% of foreign investors did purchase single-family detached homes, 23% purchased condos compared to 7% of domestic buyers. Similarly, only 44% of international buyers purchased their homes with a mortgage, compared to 92% of American buyers. REALTORS® reports that the majority of foreign buyers choose to pay with cash due to the difficulties associated with establishing international credit in the states. This is illustrated by the fact that 34% of potential foreign buyers were unable to complete their purchases because they were unable to obtain the financing they needed in the United States.

Peru, Panama and Brazil lead the next wave of residential growth in Latin America. Factors such as rapid GDP growth, good yields, relatively low taxes, reasonably priced real estate, and reasonable round-trip costs put Panama on Global Property Guides’ list of recommended locations to buy property, despite its history of corrupt government. Even countries like Chile and Colombia provide better odds for appreciation than more established markets, the report concludes.

Overall, the report sees stronger markets around the world. Nineteen out of the 36 countries tracked posted gains in the first quarter of 2010, led by Hong Kong, Singapore and cities in Australia. In most countries experiencing declines, the pace is slowing. Notable exceptions are Ireland, Bulgaria and Thailand.

Although Asia’s valuations are skyrocketing, GPG considers the region as over-valued. In Europe, property markets have not sufficiently adjusted from their 15-year rise. The United States offers opportunities, but deals might be limited to the areas hardest hit by the financial crisis, such as Florida, Las Vegas and California.

The National Association of Estate Agents (NAEA) has campaigned for HIPs to be scrapped, arguing they have failed to benefit home buyers and actively discouraged sellers. New Housing Minister Grant Shapps has committed to a consultation on their removal. “This is great news for the housing market and for house buyers, few of whom have paid much attention to these pointless packs. It is also good news for sellers, who will no longer need to shell out hundreds of pounds for a piece of pointless regulation that benefits no one,” said Peter Bolton King, chief executive of the NAEA.

Also in support of ending the packs, Nicholas Leeming, a director of the online estate agents Zoopla, said, “The abolition of HIPs is a positive move for the housing market. Sellers see them as an annoyance, buyers don’t ask to see them and solicitors often refuse to rely on the information they contain.” PropertyWire.com further reports.

The annual rate of increase of asking prices decreased from 6 percent to 4.3 percent, suggesting that the real estate market is cooling after months of price increases. In comparison, demand in 2009 far surpassed supply, causing buyers to snap up available properties and prices to rise.

“Sellers are starting to reduce their pricing expectations to court the fewer buyers who are able to proceed, though the number of buyers who can purchase is too low to bring volume back to the housing market,’”said Miles Shipside, Rightmove’s commercial director.

Lenders continue to demand large deposits and high credit worthiness. “There aren’t enough ready and able buyers to soak up a surge in fresh stock,” Shipside added.

Property advertised on Rightmove’s web site reportedly accounts for 90% of properties for sale in Britain. Over the last month the company has been recording in excess of 30,000 new listings a week, the greatest since the week starting June 28, 2009.

“Canada’s housing market has gone from full gallop to stately canter and is poised to slow to a leisurely trot in the months ahead,” said Bank of Montreal deputy chief economist Douglas Porter. He added that higher rates, tighter mortgage rules and the HST will rein in activity.

Housing prices in April rose 12.2 percent compared to April 2009. However, that is the mildest gain in eight months. Home sales were up 20.3 per cent in April. That trend also seems to be slowing, Porter says, especially when compared to last year’s sales gain of more than 70 percent.

The Canadian housing market is cooling the report says. Due to the rebound of the labor market, the decline will be moderate, economists say.

Ajay Jain, who launched the website, is a 29-year-old real estate professional who once worked in land acquisitions for SmartCentres Inc., one of Canada’s largest shopping-center developers. He said his goal is not to lower commissions. A seller might choose a person with the most experience over the one with the lowest commission, he said. “The general concept is, if agents compete, the homeowner is going to win,” he said.

The business plan calls for the real estate agent to pay an average of $30 to make a proposal to a homeowner. To participate on the site, a Realtor needs to be a member of CREA with access to the MLS. The company will require that all licenses be verified by the agent’s brokerage.

Phil Soper, chief executive of Royal LePage Real Estate Services Ltd., said referral websites like Jain’s already exist in the United States. An example of which includes HomeGain.com, based in Emeryville, California, this 11-year-old company is a provider of online marketing programs that connect real estate agents and brokers with homebuyers and sellers. In Canada, consumers looking to compare proposals from agents must do so on their own.

Scotia Capital economist Derek Holt predicted a rush to purchase to occur before new mortgage rules, the July 1st introduction of the harmonized sales tax in Ontario and British Columbia, and second-half rate hikes kick in. “That should continue to give a bid to prices in the spring market,” he said.

Douglas Porter, deputy chief economist at BMO Capital Markets, said signs show that the market will begin to simmer down later this year, but only after another burst of activity in the spring. CREA expects rising inventories to help dampen price gains.

In response to the surge in housing prices, Finance Minister Jim Flaherty moved to make it more difficult to get a mortgage.  Borrowers must now meet standards for a five-year fixed-rate mortgage, even if the buyer wants a variable rate mortgage.

“The resale market is becoming more balanced in a number of provinces,” said CREA president Dale Ripplinger. “A more balanced market is likely to result in smaller price increases going forward.” The average house price in January ranged from $155,783 in New Brunswick to $491,571 British Columbia.