Midweek property news update
Property market surge puts chains under pressure
3 minutes to read
Mortgage approvals hit a 13-year high
Mortgage approvals for house purchase soared 28% last month to their highest level since October 2007.
The pandemic has completely upended what is usually one of the quietest months of the year for the property market and the cheap cost of debt is driving a significant amount of activity, according to Hina Bhudia of Knight Frank Finance.
Most of the activity Bhudia has seen is at sub 75% loan-to-value and the lenders all want a bigger slice of that market. The surge in transactions at that level also means turnaround times between submitting an application and getting approval varies hugely from lender to lender.
Activity puts chains under pressure
Delays are becoming a theme and suggest various parts of the property buying process remain under strain due to the scale of activity that has taken place while many businesses are still working with skeleton staff and grappling with the effects of the pandemic.
In a new diary of an agent, Chris Druce heads to north west London and Sevenoaks. Here, Chris finds the stamp duty holiday has helped generate the activity that property chains rely on, however, conveyancing delays are placing chains under pressure.
All this points to an increased need to initiate proceedings earlier, whether that be to buy or refinance a home.
Deal or no deal
The Times reports that the EU has dropped its demand that it must reach a broad agreement on all the outstanding areas of dispute with the UK before drafting a final agreement, fuelling hopes of a Brexit deal.
Though positive, this is likely one of several swings in coming weeks that will impact both the FTSE and sterling. A government official quoted in the piece urged caution in expecting an imminent breakthrough, warning that “we are still pretty far apart on the difficult things”.
Meanwhile, MPs yesterday voted to approve legislation that gives ministers the power to break its divorce deal with the EU.
China's recovery
The recovery is gathering pace in China. Two closely-watched surveys revealed factory activity is accelerating, driven by overseas demand for China-made products.
Luxury spending is also on the rise. Prada has said the group’s China sales jumped 60% in June and 66% in July, while LVMH said that in some weeks since March when the country came out of lockdown, Louis Vuitton and Dior have seen China sales more than double.
A reminder that Hermès handbags topped our Luxury Investment Index (KFLII) with 13% annual growth.
Tracking the vaccines
The chief executive of GlaxoSmithKline, the world’s largest maker of vaccines, said she was optimistic the industry will be able to make an immunisation against Covid-19 widely available next year.
Meanwhile, results from an early safety study of Moderna's vaccine candidate in older adults showed that it produced antibodies at levels similar to those seen in younger adults.
Moderna is already testing the higher dose in a large Phase III trial.
In other news...
Britain’s over-50s rethink plans as virus takes toll on retirement; cities are too resilient to be killed by Covid; Spain to unveil new national rules for imposing coronavirus controls; charity boss leads review into property valuations; Google commits to office life with expansion of London estate; Australian housing’s resilience buoyed by cheap and easy credit.