In most countries, a new blockade policy has been in place for more than a month, in parallel with the policies and support measures from the Government and the landlord, the phenomenon of breaking rental contracts has not been recorded widely.
The countries where some of the tenants and small companies that have terminated their contracts early are China, Italy, Portugal, and Switzerland.
“Government intervention is a strong hallmark of this crisis. Support packages or interventions from the government such as property tax reduction or temporary prohibition of outward activities, are recorded in 59% of the countries participating in the survey”, Savills said.
According to this unit, the retail sector benefited the most, with some support packages recorded in 75% of countries. For example, the percentage of business in the UK is suspended for every business in the fiscal year 2020-2021. In Singapore, restaurants, shops, hotels, and tourist destinations will not pay real estate taxes in 2020.
The epidemic does not affect the capital value
The survey has shown that the trading volume is currently decreasing but not sharply decreasing. In the first half of April, 44% of countries recorded no change in transaction volume. For the office market, nearly half of the countries reported no changes in trading volumes since the end of March 2020, when 73% of the countries had average or sharp decrease.
The retail and hospitality sector continued to witness a sharp decline in the types of transactions, with 73% and 68% respectively recording a decrease, the effect of the national closure and the restriction of travel. The survey also indicated that the disease did not affect the capital value with 63% of countries saying their capital value did not change despite the small volume of transactions.
The logistics and health sectors remain good prices, with 87% and 95% of the countries having capital values unchanged and increasing, respectively. Both sectors will continue to have high demand in the near future. More than two-thirds of the countries surveyed did not report a change in capital values in the office and housing sectors.
In the housing sector, when a policy of closure to contain the disease severely affected transactions with buyers, 73% of countries recorded an unchanged capital value, compared to 53% in a survey.