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  #201  
Old 19.01.2012, 17:28
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Re: Housing bubble about to explode in the Arc Lemanique

see the pdf published by UBS (UBS real estate focus 2012)

http://www.ubs.com/global/en/wealth_...ate_focus.html

Specifically the graph on page 10. According to UBS we are not in a bubble but in a boom approaching Risk/Bubble but clearly above Balance
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  #202  
Old 19.01.2012, 17:53
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Re: Housing bubble about to explode in the Arc Lemanique

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see the pdf published by UBS (UBS real estate focus 2012)

http://www.ubs.com/global/en/wealth_...ate_focus.html

Specifically the graph on page 10. According to UBS we are not in a bubble but in a boom approaching Risk/Bubble but clearly above Balance
The plot represents the swiss average. But the Geneva lake region is considered by UBS as already in "bubble"... together with Zuerich). Unfortunately that is where I'm living...
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  #203  
Old 19.01.2012, 18:12
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Re: Housing bubble about to explode in the Arc Lemanique

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I'm looking at the numbers now, one of the things I'm also trying to figure out is if to wait or not. I am planning to pay more than the 1% minimum principle plus interest to build equity.
Have you considered putting down a large enough deposit so that you are not paying the second hypotek, which is a much higher rate? (IIRC, 33% down frees you from a second hypo).

If you want to build equity, have you considered how you structure your tranches? Splitting into a mix of short and longer term tranches give you the ability to pay a tranch off when it comes due, or rolling it over. You are obliged to pay off the full interest even if you pre-pay the loan, so if early payment is a goal then splitting and paying off a shorter term tranche (and thus not incuring that extra interest) might make more sense, depending on your individual situation.
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  #204  
Old 23.01.2012, 11:24
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Re: Housing bubble about to explode in the Arc Lemanique

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Eight reasons against considering real estate a safe investment - a very interesting article in today's Neue Zuercher Zeitung:

http://www.nzz.ch/nachrichten/wirtsc....14398893.html
The same article in french, by the AGEFI magazine:

http://www.agefi.com/2012-01-19/Le-l...e---311137.php
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  #205  
Old 24.01.2012, 23:39
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Re: Housing bubble about to explode in the Arc Lemanique

And now the OECD warning about the swiss housing bubble:
OECD warnt die Schweiz vor Immobilienblase

http://www.tagesanzeiger.ch/wirtscha...story/30996075
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  #206  
Old 25.01.2012, 12:04
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Re: Housing bubble about to explode in the Arc Lemanique

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And now the OECD warning about the swiss housing bubble:
OECD warnt die Schweiz vor Immobilienblase

http://www.tagesanzeiger.ch/wirtscha...story/30996075
Here are the comments from the source.
http://www.oecd.org/document/53/0,37..._1_1_1,00.html
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  #207  
Old 25.01.2012, 12:20
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Re: Housing bubble about to explode in the Arc Lemanique

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Here are the comments from the source.
http://www.oecd.org/document/53/0,37..._1_1_1,00.html
And here is the interpretation by the swiss conferedation:

http://www.news.admin.ch/dokumentati...r&msg-id=43130

Selon l'OCDE, le bas niveau des taux a induit un boom hypothécaire et une hausse des prix de l'immobilier. Certains marchés immobiliers régionaux montrent des signes de surchauffe. Compte tenu de l'endettement brut élevé des ménages, les risques de formation d'une bulle des prix des logements pourraient être exacerbés pour les petites banques axées sur le marché intérieur.

or in German

Die niedrigen Zinsen hätten zu einem Hypothekenboom und steigenden Immobilienpreisen geführt. Überhitzungserscheinungen in einigen regionalen Immobilienmärkten seien erkennbar. Auf Grund der hohen Bruttoverschuldung der Haushalte könnten sich die Risiken bei einer drohenden Immobilienpreisblase für kleinere, binnenmarktorientierte Banken erhöhen.


The complete report can be downloaded here:

http://www.news.admin.ch/NSBSubscrib...ents/25523.pdf (french)

http://www.news.admin.ch/NSBSubscrib...ents/25522.pdf (deutsch)
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  #208  
Old 26.01.2012, 08:18
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Schuld I start a new thread "how safe is PostFinance"? I believed they're not a regular bank, but they're also doing mortgages...
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  #209  
Old 26.01.2012, 10:17
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Re: Housing bubble about to explode in the Arc Lemanique

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Schuld I start a new thread "how safe is PostFinance"? I believed they're not a regular bank, but they're also doing mortgages...
Their mortgages are offered by PostFinance but come from a German bank (I forget which), so I assume they simply take a small cut for originating the deal and pass on all the risk.
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  #210  
Old 28.01.2012, 18:19
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Re: Housing bubble about to explode in the Arc Lemanique

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Their mortgages are offered by PostFinance but come from a German bank (I forget which), so I assume they simply take a small cut for originating the deal and pass on all the risk.
And their placements "e-deposit" etc? Are these "outsourced" as well?
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  #211  
Old 28.01.2012, 21:46
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Re: Housing bubble about to explode in the Arc Lemanique

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Anyway, it's not me who is predicting a burst, it's just a bunch of people around a small bank named UBS or something like that.
You seriously want to take notice of UBS, they went bust did they not?

Like a lot of other banks they could not even manage their own business
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  #212  
Old 28.01.2012, 23:51
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Re: Housing bubble about to explode in the Arc Lemanique

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You seriously want to take notice of UBS, they went bust did they not?

Like a lot of other banks they could not even manage their own business
Agreed for UBS ... but it's not just them warning about a bubble... almost everybody does nowadays see this coming ahead rather sooner than later

... except for those selling or about to sell their own property, that is
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  #213  
Old 29.01.2012, 00:28
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Re: Housing bubble about to explode in the Arc Lemanique

YEP!
This is not America.........

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If the value of the house decreases, then the bank has the right to ask you to increase your contribution to the mortgage so that the risk is transfered to you...
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  #214  
Old 29.01.2012, 17:20
gva
 
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Re: Housing bubble about to explode in the Arc Lemanique

A crystal clear article (in french) why real estate prices in Switzerland are hitting the ceiling:

http://www.objectifeco.com/economie/...se-depuis-1850
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  #215  
Old 30.01.2012, 01:01
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Re: Housing bubble about to explode in the Arc Lemanique

I can only speak from anecdotal evidence, but my wife has been very active in the last 5 months looking at about 40 properties in Terra Sainte. We are looking at town homes and villas and of the 10 we liked we feel the prices are way to high. 1.6M for a 1970s townhome of 150m2 right on the highway? No thanks. 2.5M for a brand new townhome in Chavannes-des-Bois with 650m2 land? No thank you.

The nice thing, many of those are not selling, realtors are calling her every few days to see if we are still interested. These properties are NOT moving. We actually made an offer on one for 300k below the asking price and were laughed away. Guess what, it still sits there 4 months later....empty.

I can tell you that people are disillusional what they think they can get. They see the market is great and just throw crazy numbers out there. The fact that all these articles come up of an impeding bubble makes a lot of people hesitate. And the seller that rejected our offer will eventually regret that move. Having bought in Florida in 2007 and needed to sell in 2009 when I moved to GVA, I see a lot of parallels. Of course the underlying demographics are better here, but the prices are even more out of whack compared to Florida if you take housing cost as part of income. And knowing that the Swiss banks will be less forgiving than the US banks (or government) and they can literally ask you to finance the risk gap even if you are paying your monthly dues to them is disaster to happen.

We decided to keep renting, even though we could save 30% of the rent by locking in a mortgage for 10 years. Given that we would need about 3-4 years to recoup our buyer costs by paying less rent the risk is too high at the moment. We reckon we don't loose a lot by waiting.

Last edited by acf69; 30.01.2012 at 01:02. Reason: clarification
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  #216  
Old 30.01.2012, 10:17
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Re: Housing bubble about to explode in the Arc Lemanique

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We decided to keep renting, even though we could save 30% of the rent by locking in a mortgage for 10 years. Given that we would need about 3-4 years to recoup our buyer costs by paying less rent the risk is too high at the moment. We reckon we don't loose a lot by waiting.
Be aware that the bank will ask you to increase your deposit if they think the value of the property, that can easily exceed the 30% savings your talking about. In any case if capital values fall so will rental costs. You are also taxed on the rent that you don't pay, if you own a house!
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Old 30.01.2012, 11:08
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Re: Housing bubble about to explode in the Arc Lemanique

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I can only speak from anecdotal evidence, but my wife has been very active in the last 5 months looking at about 40 properties in Terra Sainte. We are looking at town homes and villas and of the 10 we liked we feel the prices are way to high. 1.6M for a 1970s townhome of 150m2 right on the highway? No thanks. 2.5M for a brand new townhome in Chavannes-des-Bois with 650m2 land? No thank you.

The nice thing, many of those are not selling, realtors are calling her every few days to see if we are still interested. These properties are NOT moving. We actually made an offer on one for 300k below the asking price and were laughed away. Guess what, it still sits there 4 months later....empty.

I can tell you that people are disillusional what they think they can get. They see the market is great and just throw crazy numbers out there. The fact that all these articles come up of an impeding bubble makes a lot of people hesitate. And the seller that rejected our offer will eventually regret that move. Having bought in Florida in 2007 and needed to sell in 2009 when I moved to GVA, I see a lot of parallels. Of course the underlying demographics are better here, but the prices are even more out of whack compared to Florida if you take housing cost as part of income. And knowing that the Swiss banks will be less forgiving than the US banks (or government) and they can literally ask you to finance the risk gap even if you are paying your monthly dues to them is disaster to happen.

We decided to keep renting, even though we could save 30% of the rent by locking in a mortgage for 10 years. Given that we would need about 3-4 years to recoup our buyer costs by paying less rent the risk is too high at the moment. We reckon we don't loose a lot by waiting.

Indeed. Just looking at some houses advertised in my neighborhood in www.cgi.ch:

- 3 maisons jumelles in Chavannes de Bogis. One of them I know well on less than 100m from the A1 highway.All of them around 1.5M CHF.
- Another house in Founex for over 2M CHF, the photographer didn't even care to avoid including into the picture the 400kV high tension transmission lines crossing the property :-)

All of them on sale since 6 months or more.
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  #218  
Old 30.01.2012, 11:09
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Re: Housing bubble about to explode in the Arc Lemanique

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A crystal clear article (in french) why real estate prices in Switzerland are hitting the ceiling:

http://www.objectifeco.com/economie/...se-depuis-1850
Thanks for this article, very interesting..

it doesn't need a genius to understand that there will be a price correction when currently only 2.5% of the households can afford to buy property for 1M CHF or more, but 30-40% in CH are actually property owners...
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  #219  
Old 30.01.2012, 11:25
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Re: Housing bubble about to explode in the Arc Lemanique

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Thanks for this article, very interesting..

it doesn't need a genius to understand that there will be a price correction when currently only 2.5% of the households can afford to buy property for 1M CHF or more, but 30-40% in CH are actually property owners...
... and don't count on sustained immigration to hold up this problem.

Immigration to Geneva has been significantly lower in 2011 than in 2010, according to the Office Cantonal de Statistique:

"Le solde migratoire a nettement diminué en 2011 (+ 1 167) par rapport à 2010 (+ 4 546) du fait de la baisse de l'immigration occasionnée par une conjoncture incertaine"

http://www.ge.ch/statistique/tel/com...cp_2012_02.pdf

And 2012 won't be better than 2011, certainly...
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  #220  
Old 31.01.2012, 13:00
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Re: Housing bubble about to explode in the Arc Lemanique

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And their placements "e-deposit" etc? Are these "outsourced" as well?
No.

[Filler - message too short]
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