RESIDENTIAL SALES

Global Residential Outlook - 27 November 2020

Key takeaway The resilience of prime prices in the world’s top cities as reported in our new Prime Global Forecast is attributable to several factors which together explain why 2020 is not 2008, as far as luxury residential markets are concerned. Fiscal stimulus on a significant scale along with pandemic-fuelled pent up demand has seen average annual prime price growth increase from 1.2% in June to 1.6% in September.
Written By:
Kate Everett-Allen, Knight Frank
3 minutes to read
Categories: Property Sector Residential Sales service Sales Topic Covid-19 World Regions Global

Need to Know:

  • New daily cases are now falling across much of Europe. France is to ease its lockdown from Saturday although French ski resorts will remain closed until the end of the year. Germany is one exception with daily cases still rising which may see lockdown measures extended until 20 December. In England, a revised tiered system will come into force once lockdown ends on 2 December.
  • From 15 December arrivals into the UK can reduce their quarantine from 14 to 5 days by purchasing a test offering some hope to a beleaguered travel industry.
  • Five global airlines will introduce a digital health pass enabling passengers to certify they are Covid-free before travelling. United Airlines, Lufthansa, Virgin Atlantic, Swiss International Air Lines and JetBlue will begin rolling out the Common Pass in December. In time, it will also be used to provide proof of vaccination.
  • In Brexit news, the UK and Canada signed a rollover trade deal last weekend and Paris has been named as Goldman Sachs’ new trading hub and a dual listing location for Segro.
  • Hong Kong and Japan have agreed to resume business travel by the end of November, whilst the planned travel corridor between Hong Kong and Singapore however has been postponed due to rising case numbers in Hong Kong. Australia is opening its Queensland/NSW border from 1 December.
  • In the US, Joe Biden has confirmed he will not order a US national lockdown.

Residential Digest

Europe

  • Spain: New-build prices registered a 0.6% increase in the year to July 2020, whilst existing homes registered a 1.75% decline over the same period according to the new Spain New-Build Snapshot Report. European buyers continue to account for around 42% of Spain’s overseas buyers with Germany, Romania and France key sources of demand.
  • Portugal: Golden visa investment declined 52% year-on-year in October taking total investment to €28.6 million, according to Foreigners and Borders Service (SEF).

Asia Pacific

  • New Zealand’s central bank will reimpose mortgage lending restrictions from March 2021 amid concerns historically low interest rates are fuelling price inflation. The Reserve Bank of New Zealand has been asked by the government to consider house price “instability” when setting monetary policy.

  • China’s currency has recorded its best six months against the dollar on record boosting Chinese buying power in the US as well as in those markets pegged to the US Dollar such as Dubai and several Caribbean markets.

  • Knight Frank’s new Asia Pacific Outlook Report sets out the direction of travel for prime residential markets across the region with the improvement in sales volumes evident between March and October 2020. Cities across Mainland China, India and New Zealand are currently registering the strongest levels of activity.


US and Canada

  • Manhattan saw 25 sales contracts signed above US$4 million last week, highest weekly figure since March and three more sales than the previous week
  • US house price indices reach highest level in 15 years. At 9.1%, the annual rise on the Federal Housing Finance Agency (FHFA) index is the highest since 2005 but analysts expect the pandemic-fuelled surge in demand to moderate and activity to slow in Q4 2020.

For further information on any of the datasets or research reports highlighted please contact Kate Everett-Allen