Friday property news update -17 September
New York rising, the government's planning mess and London fashion week rolls into town
4 minutes to read
New York
On Monday New York City's 300,000 strong municipal workforce returned to work five days a week. No remote work. No hybrid option.
It is one of numerous ways New York City has become a test case in the tentative return of urban life. Corporates are taking a softer touch approach than Mayor Bill de Blasio. The Delta variant has caused many to delay their office reoccupation plans, though as Boston Properties CEO Owen Thomas said last month, that question is now 'when' and not 'if' workers return.
A recovery in Manhattan's property market is well underway. Back in June we covered various signals suggesting those that had left the city during the pandemic did so temporarily. The number of residential sales in Manhattan rose 152% in the second quarter of 2021 compared to a year earlier, according to Douglas Elliman.
There's more to all this than meets the eye, so for this weeks Intelligence Talks I join Anna Ward and Dan Tubb, senior director of sales at the Towers of the Waldorf Astoria Residences, to discuss the future of Manhattan, the surburban housing boom and what it all means for housing markets globally. Listen here, or wherever you get your podcasts.
Fashion week
We'll have more on the recovery of 150 city housing markets later this month when we publish our Global Residential Cities Index. Fashion Week rolls into London today, so Chris Druce checks in on the fashion capitals.
New York leads, with growth of 16.8% in the year to June, followed by London (6.3%), Paris (4.6%) in Paris and Milan (2.6%). To cap off a busy week for house prices, the ONS on Wednesday said UK house pries pared annual gains to 8%, down from 13% a in June. Here's Tom Bill on that:
“Like a bad Hollywood blockbuster, the UK housing market looks like it will have a predictable finale this year after an explosive start. The key question is by how much supply picks up as autumn approaches. We expect seasonality and needs-driven buyers to play an important role in driving supply higher, which should start to curb house price growth.
"The monthly decline in July was the largest since 1992 and the second steepest since 1968 and we therefore expect annual growth to end the year in single digits.”
Planning
Last Saturday's Times broke the news that the latest hotly debated reforms to the planning system would be watered down. The writing has been on the wall for weeks, see this episode of Intelligence Talks from last month for more details.
As with all the chopping and changing of housing policy in recent years, developers are buying land or making construction-related decisions based on an anticipated policy environment and market conditions months or years in the future. Though efforts to clean up the planning system's various flaws are welcome, more than anything developers want some clarity and consistency.
As Redrow chief executive Matthew Pratt tells the FT: "We would just like to have some certainty going forward and for things to be a bit more predictable. If you want to drive an industry to grow, you can’t switch it on and off.”
Education
Momentum fuelling a return to offices is building, though there remains some way to go. So if you aren't sure how many times a week you'll be boarding a London-bound train from Surrey, what does that mean for students flying to the other side of the world to study?
It's an important question for property markets, particularly those in prime locations. Education is now the primary driver of 4% of residential purchases by ultra-high-net-worth individuals globally (those with US$30 million in wealth or more), according to The Wealth Report 2021. For a sense of what that means, that equated to £2.3 billion of purchases across London alone last year.
Flora Harley speaks to experts to see what the future holds. The data, so far, looks positive. UCAS applications to UK universities rose by 22,500 this year, with a 17.1% increase from non-EU residents.
In other news...
John Lewis looks to flats and financial services for its post-retail future, global debt is soaring, Thailand's ten-year visas for the wealthy, two in five British businesses are struggling to find workers, the US economic outlook darkens on Delta, man loses $27 billion in China's crackdown on internet giants, and finally, is it time for the Bank of England to start tightening monetary policy?
Photo by ben o'bro on Unsplash