Monday property news update - 23 August
New million pound markets, economic growth wobbles and pressure to solve the green homes problem
3 minutes to read
Million pound markets
As the stamp duty holiday winds down and the impact of Covid fades, it is possible to study lasting changes to the UK's property market. Tom Bill this morning looks at the creation of new £1 million markets and finds the list is dominated by London and the south east, but has a distinctly suburban flavour.
More than half the list is outside the core London postal districts. It is topped by Whetstone (N20) and Farnham (GU10), followed by Kingston Upon Thames (KT2) and Hartfield (TN7). Outside the capital, new £1 million markets include North and West Oxford (OX2), Tunbridge Wells (TN3) and Reading (RG8).
The data underlines the degree to which demand for space and greenery following successive lockdowns has been the deciding factor in many purchases - see the full piece for more.
The stamp duty effect
A Resolution Foundation think tank study published over the weekend weighs the various drivers of house price growth during the past year. As expected, the dramatic increase in the aggregate savings rate, radical changes to housing preferences and falling mortgage rates are all part of the picture.
The stamp duty holiday, on the other hand, did not meaningfully contribute to house growth, the study finds. Indeed, prices have grown by more in local authorities in which the average buyer experienced negligible, if any, savings as a result of a transaction tax holiday, compared with areas where far higher savings were achieved.
Growth questions
The world's central bankers will meet (virtually) this week in Jackson Hole, Wyoming, at an annual event usually scrutinised for clues as to how monetary policy is likely to shift over the coming weeks.
The event comes at an interesting moment - various economic indicators have started missing expectations, raising the question as to whether the world's economic growth spurt is waning amid the spread of the Delta variant. Recent US indicators have missed the mark by the greatest degree since the onset of the pandemic, according to an economic surprise index collated by Citigroup and quoted in the FT.
Citi’s measurements of how economic reports in G10 countries have fared compared with estimates also fell into negative territory. That follows UK data released Friday showing retail sales unexpectedly fell 2.5% in July compared to a month earlier.
The green homes problem
Fourteen executives from major companies and organisations including British Gas, Eon, Nationwide and The Federation of Master Builders have urged the government to "urgently" develop a strategy to slash emissions from the UK's stock of existing homes - link to the FT piece.
Claire Tracey, chief strategy and sustainability officer at Nationwide, called on the government to “create a national retrofitting strategy that ensures the UK’s Paris Agreement commitments can be met. Anything less and we risk not only missing our climate targets, but also missing an opportunity to achieve higher-quality housing, lower energy bills, and new green jobs for the whole of the UK.”
The government is in the unenviable position of needing to make policy decisions dictating billions of pounds worth of long-term investment while there remains key questions as to the appropriate tech to support. We covered the issue in detail in just twenty minutes during this weekend's edition of Intelligence Talks - for those looking to get up to speed quickly, I highly recommend it.
In other news...
In a new Rural Market Update, Andrew Shirley weighs up two consultations on proposals for the Oxford/Cambridge development arc (covering Oxfordshire, Buckinghamshire, Northamptonshire, Bedfordshire and Cambridgeshire).
Plus, Faisal Durrani unpicks the mixed performance across Saudi Arabia’s various real estate market asset classes.
Elsewhere - an agreement between the Scottish National Party and the Green Party published over the weekend committed to implementing "an effective national system of rent controls." - see here for the write up in Landlord Today, and finally, why MIPIM will be quieter this year.
Photo by Robert Anderson on Unsplash