Your midweek property news update
An imminent Brexit deal, the vaccine scramble and property’s place in the economic recovery
3 minutes to read
Will they, won't they and what next?
The pound rose yesterday on reports that Britain and the EU could reach a Brexit deal as early as next week. If this process does end up being a re-run of the final months of 2019 (with much higher economic stakes), then the pound will get stronger and the currency discount for overseas property buyers in the UK will erode.
As the UK unemployment rate ticks up, led by large cities, policy makers are turning their attention to the recovery. Boris Johnson will today unveil a ten-point plan for a “green industrial revolution” that includes installing 600,000 heat pumps a year by 2028 as part of plans to make homes, schools and hospitals greener.
Meanwhile, Bank of England Governor Andrew Bailey used a speech yesterday to signal that he favours loosening rules on investments to boost the recovery and that sweeping changes in the way we live and work brought on by the pandemic may be the solution to the UK's productivity problem.
Housing's place in the economic recovery
As the Chancellor Rishi Sunak introduced the Stamp Duty Holiday back in July, he hailed the housing market as a driver of job creation and economic growth.
Quite how much growth each housing transaction creates has been up for debate, until now. New analysis by Knight Frank and the Home Builders Federation reveals that, for every housing transaction that takes place, the economy benefits by around £9,559. Scaling that figure up means that for every 100,000 housing transactions, there is a net impact of just shy of £1 billion.
More than 11,500 jobs are supported either directly or indirectly by these transactions, writes Oliver Knight. You can see how this all breaks down in the report.
The global scramble for vaccines
Euphoria in markets that Moderna's vaccine had shown more than 94.5% efficacy in clinical trials started to wear yesterday, with global markets dipping on a darkening economic outlook.
The euro zone is on track for its first double-dip recession in nearly a decade, according to a Reuters poll of economists. Those polled expect the economy will now shrink 7.4% this year, less than the -8.0% predicted in the October, with 2021 growth at 5%, the weakest expectation since a poll taken in May.
The NYT has a write up of what it will take to get the vaccines to market at scale, which includes a suggestion the companies will have enough to vaccinate 22.5 million Americans by January. The global scramble for vaccines is straining supplies of everything from stainless steel tanks to the custom-made plastic bags that line them.
Rental resilience
We've talked in recent weeks about the resilience of purpose-built rental property that tends to be underpinned by long-term demographic shifts.
New analysis suggests institutional investment into the UK senior living market will top £1.5 billion by the end of 2020, underpinned by rising demand and a lack of supply.
In the next five years, we expect to see a race to scale and brand building from some of the early movers to create management platforms with operational efficiencies, according to Lauren Harwood, who conducted the research. Accordingly, we expect the number of specialist seniors housing units across the UK to grow by approximately 10% over this time.
In other news...
In a new agents' diary, Chris Druce heads north.
Plus, the 15-minute city is urban planning's new utopia, the Capital of Sprawl gets a radically car-free neighborhood, college dorms go beyond students as occupancy dwindles, the digital nomads did not prepare for this, Pfizer reaches safety milestone for Covid vaccine, investors snap up centuries-old shophouses in Singapore, UK green bonds offer belated boost to London’s ESG ambitions, ESG falls down the investment agenda, and finally, foreign investors pile back into booming China.