Friday property news update
Ski market outlook, housing sentiment, capital gains and Biden’s plans
3 minutes to read
The property market outlook
The RICS survey of UK estate agents suggests new buyer enquiries, new instructions, transaction volumes and house prices all continued to rise through October. The net balance of +68% reporting rising house prices is the strongest reading since 1999, according to Reuters, as agents report growth across every region of the UK.
Expectations that sales volumes will continue to rise over the next three months ticked up to +17%, though the twelve month outlook grew more downbeat. A net balance of -27% of respondents anticipate sales will begin to weaken over that timeframe.
Chris Druce this morning has all the key data points that give a full picture of what's happening in the property market in our November update.
Mountain escapism
Covid-19 and the resulting lockdowns have significantly disrupted global real estate markets. The ski market has been no exception.
Knight Frank's 2021 Ski Property Report, out now, unpicks the big issues in Alpine real estate markets, including whether we will see a redistribution of value from urban to resort locations, the effect of resorts missing out on their lucrative Easter season and of course the next hot spots for growth.
So far, the average price of a four-bedroom chalet has remained resilient in the face of the pandemic, writes Kate Everett-Allen. Our index of properties across 19 resorts in the French and Swiss Alps climbed 1.2% in 2020, led by Saint-Martin-de-Belleville, down slightly from the 1.4% growth we saw last year.
Capital gains
The Chancellor Rishi Sunak is considering proposals to reform Capital Gains Tax that include aligning rates with higher income tax levels and lowering the threshold for paying the tax, as well as making it payable when inherited items are sold, and abolishing tax breaks for investors.
Tax experts are critical of the proposals across many of today's papers. Here tax and accountancy specialist Blick Rothenberg on what it calls "a dangerous set of proposals that are a far cry from simplification."
The company suggests a flat rate of CGT of 28% would be more sensible, but that any rate increase should not come into effect until after 5 April 2022, when the economy is likely to be on a steadier footing.
Joe Biden and what lies ahead
After Joe Biden's narrow win in Arizona was confirmed overnight, Flora Harley weighs up his prospects of passing sweeping reforms in the months ahead.
Biden has pledged to undo many of the taxation changes of Trump’s presidency affecting both individuals and companies. They include; raising the corporate tax rate to 28%, from 21%; increasing taxes on those earning more than $400,000 a year; putting the top individual income rate back to 39.6%, and asking for those making more than $1 million to pay the same rate on investment income as they do on their wages.
Meanwhile Stephen Wong considers the implications for Asia-Pacific real estate markets. Any improvement in US economic performance is likely to spill over into the global economy and US capital outflows, particularly into the APAC region, may increase.
In other news...
More travel corridors, flats vs houses, France holds fast on lockdown, Brexit talks hit make-your-mind-up time, a third of the world’s air routes have been lost, Vistry upgrades forecast, UK economy left playing catch-up with rest of the world, and finally, retail footfall lowest since the spring.