Monday property news update
Stamping out stamp duty, jabs in June and what next for the City of London
3 minutes to read
Rolling out the vaccines
The number of people testing positive for Covid-19 in the UK dropped to a three-week low on Saturday, a tentative milestone signalling the latest surge in infections may be turning a corner.
While there remain concerns - daily fatalities are only just dipping from record numbers and according to the NHS a new patient is still being admitted to hospital every 30 seconds - the vaccination data emerging looks increasingly positive. The Times reports the government is confident of hitting its target of vaccinating all 14.6 million vulnerable people in England by mid-February and all adults could receive jabs by the end of June.
Vaccinations of care home residents are on track to be completed by the end of the month and the government, which continues to signal its intention to begin a phased easing of lockdown in March, will begin offering vaccinations to the over-70s from today. Meanwhile Israel, which has led the world when it comes to the pace of vaccinations, offers an early example of the impact a successful roll-out is likely to have on inward investment.
The outlook for the City of London
We talked on Friday about increasing speculation over the future of the City of London, in light of the fact there was no concrete agreement on financial services in last year's Brexit deal. To get a better handle on what's now at stake, Tom Bill speaks to Huw Jones, the long-serving European regulations correspondent at Reuters.
The financial services sector is worth £130 billion to the UK economy, of which EU business represents around £30 billion. Of that £30 billion, about £10 billion, which includes investment advisory activity, is what is now at stake in the equivalence talks with the EU, relating to about 8% of total trading activity, according to Mr Jones.
For the longer-term outlook, there are more suggestions in today's papers that the PM is considering positioning London as a low tax, low regulation business hub - effectively Europe's Singapore - however as far as the banks are concerned, as little change as possible remains the best scenario. We can also expect the government to lay the groundwork for London as a hub for fintech and green finance, Mr Jones adds.
Property tax
It is common for the government to trail budget announcements well in advance in order to test the water, and we're seeing that already ahead of the upcoming March budget.
According to a report in yesterday's Sunday Times, the chancellor is considering an extension of stamp duty cuts beyond the end of March deadline. The paper also reports that, though it wouldn't be included in this budget, officials are modelling the impact of an abolition of council tax and stamp duty to be replaced with a national property tax.
The tax would be levied on the existing value of homes and could, according to the report, remove the barrier to families trading up to a bigger home and elderly people in large houses downsizing.
China's economic milestone
The Chinese economy grew 6.5% in the fourth quarter of 2020, outpacing its pre-pandemic growth trajectory. The data caps a remarkable turnaround after the pandemic halted four decades of growth.
Huge state stimulus has fuelled growth in the industrial sector while boosting investment in infrastructure and real estate. Economists expect China’s GDP will expand 8.2% this year, continuing to outpace global peers.
This has implications for real estate markets across the region, and Justin Eng has new research on navigating the post-pandemic recovery across Asia, covering housing, office and industrial markets.
In other news...
The over-50s are booking holidays, coronavirus sparks exodus of foreign-born people from UK, and finally, plans for a 30-year fixed mortgage.