Knight Frank Daily Update Tuesday 14th July
The return of high LTV lending, what really happened on "Super Saturday", and spend a year working in Barbados
3 minutes to read
Good morning,
Need to know
The British Retail Consortium said retail sales values rose by 3.4% in annual terms in June, the first year-on-year increase since lockdown began. That compares to an annual fall of 20% in April.
Data from Barclaycard also showed signs of improvement. Consumer spending fell 14.5% in annual terms in June - the smallest decline since lockdown began.
Shoppers in England will have to wear masks in shops and supermarkets from July 24 in order to cut the spread of the virus.
The World Health Organization continues to report more than 200,000 daily cases as many countries get to grips with varying levels of restrictions to contain outbreaks.
Hong Kong tightened restrictions following a new resurgence, while Queensland imposed a quarantine on anyone entering the Australian state from hotspots in neighbouring New South Wales.
The resurgence in the virus helped push oil prices down 2% yesterday on concerns new lockdowns will weaken demand during the recovery.
Finally, early data from YouGov suggests employees across 12 nations including Canada, Australia, the US and Europe aren't yet convinced by working from home.
The property market
Last month we talked about a two tier mortgage market emerging as lenders withdrew from higher LTV lending ahead of the wind up of government support schemes in the autumn.
In a significant boon for first time buyers, Nationwide said yesterday it will reintroduce lending at 90% LTV.
Nationwide chief executive Joe Garner told the FT he was swayed by a 3 per cent reduction in house prices since high-LTV products were withdrawn, buoyant demand from both buyers and sellers reported by mortgage brokers as the lockdown is eased, and the elimination of stamp duty on the price of a home up to £500,000.
Simon Gammon, Managing Partner at Knight Frank Finance tells the Guardian anybody looking for a 90% mortgage will find the process more complex than previously, because lenders are asking a whole raft of new questions and there are new ways of underwriting the loans, though the move could pave the way for a more evenly distributed recovery.
In a new agent's diary, Chris Druce probes why deals in the new homes market are completing more quickly compared to before the lockdown, and takes stock of shifting tastes in Edinburgh, as buyers reassess their current living arrangements.
The volume of capital targeting real estate investments globally is rising, with private equity funds sitting on more than $338bn of unspent money for this purpose, up from $236bn in 2015, writes Oliver Knight.
Increasingly income-producing residential property, including multifamily residential blocks and student housing, is becoming a key focus for investors. Detailed new research published today reveals the pace of growth, and has new analysis of the demographic trends underpinning it.
In his new weekly retail note Stephen Springham reveals what really happened on "Super Saturday", and discusses what we can learn from the closure of eight John Lewis stores.
Finally, Kate Everett-Allen has the latest on the shifting post-Covid-19 visa landscape, as the Barbados government moots a 12-month Welcome Stamp to allow visitors the option to work remotely from Barbados for a year at a time.
Any questions, please contact me, or the team.