Knight Frank Daily Update Monday 8th June

Good morning,

Need to know

US hiring rebounded in May, suggesting the economy is picking up faster than anticipated. The jobless rate fell to 13.3%, from the 14.7% recorded in April - Economists had forecast a jump to 19.8%. This result helped push global shares higher overnight.

In the UK, ministers are working to ease planning restrictions, where necessary, to enable pubs and restaurants to reopen on June 22nd. 

A report in yesterday's Sunday Times indicated that the Prime Minister had signed off new measures to open up the economy at a meeting with the Chancellor on Friday night. Announcements this week could include further details on weddings, hairdressers, driving instructors and "travel corridors" overseas. 

These changes come at a time when there is “a huge amount” of pent-up demand amongst consumers for shopping in physical stores as the coronavirus lockdown is eased, according to an industry report.

Denmark has lifted its limit on public gatherings from 10 to 50 people, and New Zealand’s government will lift all restrictions except stringent border controls after health officials declared that there were no longer any known, active cases .

The property market

This morning we update our outlook for the UK residential market, covering transactions, prices, lettings, residential development and the finance and mortgage markets.

A rise in May’s construction PMI from its previous low level is reflective of a pick-up we're seeing in residential development activity, suggesting that April probably marked the low point.

Construction is likely to be a focal point for the Prime Minister during the coming recovery, and ministers have assembled a committee to consider substantive changes to planning rules, according to a report in yesterday's Sunday Times. 

Measures under consideration include allowing businesses to change the use of properties “with complete flexibility” in an attempt to help the high street, a new fast-track system for developers of high-quality, well-designed buildings, and a move to a zonal planning system where key decisions will be taken from local councils and handed to development corporations.

Stephen Springham has the latest from the high street. Quarterly rent day on 24 June is looming large and could prove another major pinch point for the retail sector.

Andrew Shirley's update on rural property reveals a 50% hike in English farmland viewings last week compared with the same period in 2019. That said, supply remains sparse – the amount of land advertised last week was down over 60% year on year - so potential buyers still have little to choose from.

If you have any questions, please contact me, or the team.