The European
Vol. 1, Issue no. 13
March 6 , 2007
Paris, France Not your average "hot spot" 
| And you thought Paris was all urban chic? Watch out this week as the annual farming fair hits town-a huge event that brings the countryside to the city, covering fresh produce, the latest hi-tech equipment, and the furry or feathered stars of the farm.
www.salon-agriculture.com
Photo courtesy of istockphotos.com |
Now that March has arrived, we can look forward to the early equivalent of April showers. With much of southern Europe short of water, the expected giboulées de mars (March showers) will surely be welcomed by all but the tourists.
Although a shortage of snow has been reported on the lower slopes in the Alps, the Matterhorn is usually a safe bet for great shots of the white powder, and, this week, Steenie Harvey shares her grave concerns about venturing upward without due care. Though Poland doesn't seem to be suffering from the effects of global warming yet, its property market is certainly hotting up-read the latest report in this issue of The European. If you prefer warmer climes, you may be interested to learn about the much maligned cuisine of the sunny island of Malta…or how to go about funding a project on your property in Spain. It's all here in Issue No. 13. Bests, Leigh Fergus
Editor, The European
Not your average "hot spot" by Brian O'Brien Looking for a credible property investment in Europe? Poland may have what you want. Since joining the European Union in 2004, Poland's economy has performed well, buoyed by considerable foreign direct investment (the third highest in Europe) and a booming local property market. This may be the right time to consider your own purchase of a home in northern Europe. 
| The beautiful city of Krakow is one of Poland's property hot spots.
Photo courtesy of Krakow Investments |
Why now?
What's fuelling the current property boom in Poland? Three main drivers: a growing middle class, a housing deficit, and the potential for long-term growth. The growing number of multinational companies choosing to locate in Poland has resulted in an increase in high-level jobs for the local population, which has, in turn, created a Polish middle-class with a hunger for property ownership. Demand has also been helped by the improved availability of financing for local buyers. In 2004, only 14% of Polish people had a mortgage, but this figure has increased-mortgage approvals doubled from 2005 to 2006. This is one of the key differences with other so-called hot spots: the Polish property market is primarily locally driven, and, if you invest in Poland, you'll invariably be competing with local purchasers. This also provides you with a clear exit strategy of selling back to local buyers. Housing deficit
Poland currently has the largest housing deficit in Europe. The Housing Initiative for Eastern Europe estimates that two million new homes are needed and existing homes require immediate modernization. In fact, approximately 64% of the entire housing stock requires substantial repairs and around 700,000 of these should be replaced in the next five to 10 years. This accounts for the high level of demand for new-build accommodation. The strong demand and the urgent need to rehabilitate much of the existing stock offer you good prospects. Property samples in Krakow: Two-bedroom, 645-square-foot apartment with 215-square-foot terrace, views of Wistula river, entry phone, 10 minutes' walk from downtown: 137,000 euro ($185,000). Three minutes' walk to the main square, a three-bedroom, 1,000-square-foot apartment with high ceilings: 202,000 euro ($267,000). |
Potential for long-term growth
The relatively limited supply of land and the lengthy procedures for getting building permission will mean that supply will struggle to keep up with Polish demand and thus steadily rising prices are predicted. The Polish economy has arguably the best potential for long-term growth, with strong, sustainable price growth and relatively low interest rates (in January 2007, the rate for borrowing in euro was 5.60%). This-and the existence of a booming middle class keen to invest-makes Poland a highly attractive proposition if you want to get a property foothold in Europe.
[Editor's note: Brian O'Brien runs Krakow Investment, website: www.krakowinvestments.com, and is happy to answer any questions you may have. E-mail him at info@krakowinvestments.com or call (+353) 21-494-3934]
Secrets of the Maltese grannies by Alf B. Meier 
| An abundance of fresh fish can be found in the undiscovered cuisine of Malta.
Photo courtesy of the Malta Tourism Authority / www.visitmalta.com |
If you think that the island nation of Malta has no cuisine of its own, and that the locals lazily copy the menus of their European neighbors, prepare to be enlightened. This false impression came about because the Maltese traditionally do not dine outside their homes and many restaurants don't bother to serve local dishes (believing that the vast majority of tourists fear sampling anything other than what they'd see back home). Traced to the Phoenicians
To discover the secrets of Maltese cuisine for yourself, leave behind the tourist paths and look for old buildings with worn tiles and geranium-filled walls. Ignore signs touting dishes cooked "like mom's"-watch for spots where the food served is "like grandma's." The older generation are the guardians of Malta's culinary traditions and are responsible for the mouth-watering smells that waft through the island's little villages. Recommended local restaurant The Medina Restaurant inside the walled city of Mdina, the island's medieval capital, is a Norman residence with arches. A pair of fireplaces keeps diners warm in winter: otherwise, you eat outdoors under the oleander in the courtyard, in the shadow of a stone fountain. The wide selection on the menu ranges from roasted quail to cured swordfish and oatmeal-crusted lamb. |
The oldest island dish, traced to the Phoenicians, is called Ross-fil Forn and consists of rice, meat, and eggs. The addition of tomatoes was made at a later date.
Crisp salads and succulent vegetables are a given, as well as goat and sheep products such as fresh, half-dried, or peppered cheeses, and you'll discover a rich variety of fish dishes. Snails are not cooked French-style (where the gourmet picks them one-by-one out of their shells), but are part of a hearty stew that comes with a garlicky green sauce of fresh herbs and warmed loaves of bread.
The pleasures of pastizzi
| Sweet or savory, these flaky pastry pockets are sure to tempt you.
Photo courtesy of the Malta Tourism Authority / www.visitmalta.com |
Dessert often features fresh fruit, which is widely available. In fact, the Maltese are so proud of the quality of their fruits (the cactus figs are reputed to be the best in the world) that officials or high-ranking visitors are greeted with fruit baskets.
Other desserts include imqarets, pastries from the island's Arabic heritage, filled with dates, baked in the best quality oil and eaten warm. If they're not available, ask for honey donuts or almond cakes. If there's a festivity when you visit, make sure to order kannoly sweets, served only during special holiday seasons. Pastizzi (see photo) are mini flaky pastry pockets. These are filled with ricotta cheese, but they can also be stuffed with vegetables such as spinach or mashed peas.
Best time to visit Malta?
Visit during Carnival time (in February) or during the Jazz Festival, which runs from July 20-22.
The Swiss Alps-a Fatal Attraction? by Steenie Harvey Off to the Swiss Alps? A great place to overnight in Zermatt is the Matterhornblick Hotel-there's a splendid Blick (view) of the Matterhorn from its windows. You wake to the sound of church bells as the hotel is only a step away from the village church. 
| However beautiful these peaks may seem, they can be treacherous to climb: Be sure to take an Alpine guide with you to avoid ending up in the local cemetery.
Photo courtesy of istockphotos.com |
"I chose to climb"
Whether you intend doing anything involving pickaxes and crampons or not, the village churchyard deserves a visit. It's known as "the climbers' cemetery" and reading the tomb inscriptions is a sobering experience. Over the years, dozens of luckless mountaineers have lost their lives to the Matterhorn and its neighboring peaks."Let me go climb these virgin snows
Leave the dark stain of man behind
Let me adventure and heaven knows
Grateful shall be my quiet mind." Those words are on a memorial to Jonathan Conville, an Englishman who fell from the Matterhorn's north face in December 1979. Behind it lies the grave of Hubert Janitz, a bank cashier from Klagenfurt, Austria, who died on the Monte Rosa glacier in October 1881. Further along is a memorial to a New Yorker named Donald Stephen Williams who perished on the Breithorn in July 1975. It carries only a simple message: "I chose to climb." There are usually between 90 and 120 serious accidents in the Alps around Zermatt each year. The folly of some people beggars belief. Back in 1979, a British man was determined that his 8-year-old son would be the first child to conquer the mountain. Their bodies were never recovered. How the numerous people hobbling around Zermatt on crutches got their injuries is hard to know, but the advice is not to climb the Matterhorn without a guide from the Alpine Center. A Heidi-house chalet hotel
The Matterhornblick (Kirchestrasse, Zermatt), is a Heidi-house chalet hotel with sauna, steam-bath, and solarium. Nightly room rates include breakfast, and there's a computer in the breakfast room where guests can avail of free Internet access. This summer, the rate for double rooms is between $125 and $145; for single rooms, $63 to $92. Tel. +41 (0)27 967-2017; e-mail: info@matterhornblick.ch; website: www.matterhornblick.ch
The hows and whys of equity release by Lisa Hartwell What is equity release and why should I consider it?
Equity release is a term commonly used to indicate the release of capital in some shape or form. If you own a property that is unencumbered (i.e. without mortgage), or even if you have a mortgage on it, this capital is the equity you have in the property. You can release some of this capital to make improvements to the property or to use at your own leisure for a personal project. As an example, if you are living in Spain and need more than 15,000 euro ($20,000), it makes financial sense to release equity in your property, rather than take out a personal loan. The interest rate is likely to be half that charged on a personal loan, plus you don't need to go through a notary and the accompanying expenses: normal loans of 15,000 euro and upward must, by law, be overseen by a notary in Spain. How do I decide which product is for me?
Various products are available on the market today-as an example, the chart below shows Orange Finance's current range-and choosing one that best suits you depends very much on how much capital you want to release from your property. If you need 40% or less of your capital, you don't have to prove income today, as there are banks willing to release this amount as a normal mortgage, or, in some cases, terms of up to five years, interest-only.
Releasing equity can also be used as an income spinner. For example, if you release 120,000 euro ($160,000) over five years and let Orange Finance invest it for you using guaranteed tangible assets, this returns 20,400 euro ($27,000) after the interest-only mortgage payments have been made. Up to 75% of the value of the property can be released, but, to do this, you must show proof of your income. If 65% of the property is enough for you, a term of 35 years is available, whatever your age*, as is an interest-only period of 10 years.
The offset mortgage
This is a different form of equity release where the bank will advance up to 80% of the value of your property. Part of this capital can be for your personal use, while the remainder is invested on your behalf. The mortgage cost for these products is normally offset against the income you receive, hence its name. Some of these products have high set-up fees (be wary of anything charging more than 4%), as well as yearly charges and administration fees for the investment vehicle, all of which will take years to recover. Returns in the region of 15% are often quoted-while this is achievable, extreme caution is advised when looking into these offers. Be sure to get all figures on any of the recommended products before committing: they can turn out to be costly and the returns promised may not be realized as you planned. *In Europe, unlike the U.S., life insurance is generally required when you take out a mortgage, therefore age is often an issue. Interest Rate | Loan | Term | Interest only
| Set up | Maximum age | Redemption Fee | E + 1% | 60%
| 20 | No
| 1,25% | 70
| 1% | E + 1,7%* | 60% | 30 | indefinite | 1,5% | none | 0%-1% | E + 0.75% | 50% | 15-25 | No | 1,35% | 73 | 0%-1% | IRPH + **0,7% | 40% | 35 | 15 years | 1,5% | 75 | 1% | IRPH + 0,7% | 60% | 30 | 10 years | 1,75% | 75 | 1% | 1%-2%*** | 65% | 35 | 10 | 1% | none | £250 | 1,8% / month | 50% | bridging | indefinite | 2% | none | 0% | * First six months 5,5%. The term is 30 years, however this may be extended upon maturity
** Interest only is available for 1-15 years, This is a non status / self cert mortgage
***This mortgage is available in Euro, Sterling, Swiss Frank, Japanese Yen and US Dollars. The percentage quoted is the differential added on the base rate. This is available in Costa del Sol, Costa Blanca, Portuguese Algarve & French Cote d'Azur. E = Euribor rate
IRPH = a base rate used by many banks in Spain, set every quarter. |
[Editor's note: Lisa Hartwell works for Orange Finance, website: www.orangefinance.eu.com and is happy to answer any questions you may have. E-mail her at: lisa.hartwell@orangefinance.eu.com. Orange Finance has special arrangements with financial institutions that are not available directly to the general public.] IL
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