Monday property news update - 1st February 2021
D-day for stamp duty, negative rates and lessons learned from lockdowns
3 minutes to read
D-day for the SDLT
As MPs prepare for today's debate on a petition to extend the SDLT holiday by six months, a review of January's data by Tom Bill suggests momentum in the market remains above seasonal norms, with exchanges up 57% on the five year average and registrations of new prospective buyers up by nearly a fifth.
Unique visits to Knight Frank’s stamp duty calculator online page rose 118% between December and January, underlining the extent to which the SDLT holiday is impacting sentiment.
Tom also speaks to Sean Randall, a partner at Blick Rothenberg and chair of the Stamp Taxes Practitioners Group, to get a better feel for whether today's debate is likely to sway thinking inside the Treasury, and looks at how employment and infection rates are likely to guide decision-making. Data published yesterday shows infections, fatalities and hospital admissions all falling.
Negative rates, continued
It is going to be a busy week for the Bank of England. December's mortgage market data is due for publication in a few hours and on Thursday the latest interest rate decision will be published alongside 160 detailed responses to a consultation on whether the base rate should be cut to negative in an attempt to boost the economy.
The report on negative rates is likely to generate plenty of debate rather than any real world consequences. Tallies of economists at both the FT and Bloomberg suggest the impending recovery means that ship has probably sailed. You can read a reminder from Knight Frank Finance as to why a negative base rate would have little impact on mortgage rates here.
Elsewhere, the Bank is likely to downgrade its November forecast for Q1 growth in light of the prevailing lockdown, though economists expect it to hold back on providing any extra stimulus, again citing the likelihood of a recovery in the second half of the year.
Building beautiful
Saturday's Times carries an interview with housing secretary Robert Jenrick (news piece here) in which he outlines government proposals to give local communities the power to set design standards for new developments.
The next step is likely to be the publication of a draft national design code that provides a checklist of design principles that councils should consider for new developments, spanning "street character, building type, façade and requirements that address wellbeing and environmental impact." Each local council would then be expected to draw up their own individual design codes in consultation with local residents.
Meanwhile, the paper also reports that an amendment making it illegal for developers to pass on remediation costs for the removal of cladding to leaseholders now has 34 conservative signatures, nearing the 44 signatures needed to defeat the government’s working majority.
Lessons learned
Consumer confidence rose 0.3 points to 102.9 in January, according to an index compiled by YouGov and the Centre for Economics and Business Research. Any reading above 100 signals growth.
The data adds to a growing body of evidence that suggests the economy is proving more resilient when compared to the first lockdown - something we touched on Friday.
It appears lessons learned from previous lockdowns are now cushioning the economic blow across major economies and fourth quarter output across Germany, Spain and France all surprised on the upside.
In other news...
Andrew Shirley on post-Brexit farming, Philippa Goldstein on the outlook for the hotel sector and Tom Bill the team answer the most pressing questions on the property market.
We would still like to hear from you about what you are looking for from a home, if this has changed and what impact the current situation is having on your plans for the next 12 months. Survey here.
Plus, the Reuben brothers defy the crisis by checking into €100m Venice hotel, the Scottish government axes Help to Buy, Aviva will use its ‘ultimate sanction’ to force action on global warming, converting shops to homes ‘could destroy town centres’, Covid vaccine offered to all care homes in England, Apple to make WeWork TV series, and finally, is it time to offer rent-free shops to save the high street?