Your morning market update from Knight Frank Research - Wednesday 1st April
Good morning,
2 minutes to read
Economic headlines
Markets were muted overnight by Donald Trump’s warning of a "painful" two weeks ahead for the US as Covid-19 cases rise.
US futures - effectively bets on the market's trajectory - declined slightly, while Japanese markets pared losses and Australia outperformed.
The mixed picture from the financial markets to a large degree mirrors the evolving pandemic.
Though new Covid-19 cases in the US continue to rise, Italy now appears to have turned a corner and cases China are falling once again, after a small resurgence.
The pound is holding at $1.24 for the moment – with the markets seemingly taking a positive view on efforts to contain the pandemic in the UK.
Housing market implications
Amid widespread reports of over-stretched call centres and difficulties obtaining valuations, mortgage lenders are responding to these difficulties by overhauling their product lines at an unprecedented rate. The number of product changes made by banks in the last week was 43% higher than in the previous week, with substantial changes to maximum loan sizes or loan-to-value ratios, reports Knight Frank Finance.
Lenders are taking different approaches depending on their circumstances, with some pulling back from the market and others showing an increased appetite to do business in an effort to secure new clients.
This morning Oliver Knight has published his latest analysis of the UK build-to-rent market, which looks at lessons from the last recession which point to potential outcomes from the current crisis.
Oliver’s research points to the rental market's strong ties to demographic trends rather than economic cycles, and is a topic we will be returning to in the next few days.
Over the past week we've monitored the increasing use of new technology in the UK property market amid movement restrictions and social distancing.
To take this story a step further Kate Everett-Allen has been looking at the numbers from China and reveals a startling picture, with annual growth of 60% in the number of virtual property viewings in the most recent data.
The research team will continue to update you as the current situation develops.
If you have any questions, please contact me, or the team.