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Rising housing inflation: Barcelona plans to shut all holiday apartments

Rising housing inflation: Barcelona plans to shut all holiday apartments

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Rising housing inflation: Barcelona plans to shut all holiday apartments

Barcelona, a top Spanish holiday destination, announced on Friday that it will bar apartment rentals to tourists by 2028, an unexpectedly drastic move as it seeks to rein in soaring housing costs and make the city liveable for residents.

The city’s leftist mayor, Jaume Collboni, said that by November 2028, Barcelona will scrap the licences of the 10,101 apartments currently approved as short-term rentals.

“We are confronting what we believe is Barcelona’s largest problem,” Collboni told a city government event.

Read more: The rich to push India home prices higher, affordable housing supply to lag demand

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The boom in short-term rentals in Barcelona, Spain’s most visited city by foreign tourists, means some residents cannot afford an apartment after rents rose 68 per cent in the past 10 years and the cost of buying a house rose by 38pc, Collboni said. Access to housing has become a driver of inequality, particularly for young people, he added.

National governments relish the economic benefits of tourism – Spain ranks among the top-three most visited countries in the world – but with local residents priced out in some places, gentrification and owner preference for lucrative tourist rentals are increasingly a hot topic across Europe.

Read more: Affordable housing to stay out of reach in major economies: Reuters poll

Local governments have announced restrictions on short-term rentals in places such as Spain’s Canary Islands, Lisbon and Berlin in the past decade.

Spain’s Socialist housing minister, Isabel Rodriguez, said she supported Barcelona’s decision. “It’s about making all the necessary efforts to guarantee access to affordable housing,” she posted on X.

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Vacation rentals platform Airbnb, which hosts a significant number of Barcelona listings, did not immediately respond to a request for comment.

“Collboni is making a mistake that will lead to (higher) poverty and unemployment,” Barcelona’s tourist apartments association APARTUR said in a statement, adding the ban would trigger a rise in illegal tourist apartments.

Read more: How to provide affordable housing? By imposing up to 20pc property flipping tax

Hotels stand to benefit from the move. The opening of new hotels in the city’s most popular areas was banned by a far-left party governing Barcelona between 2015 and 2023, but Collboni has signalled he could relax the restriction.

Barcelona’s hotel association declined to comment on Friday’s announcement.

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“Those 10,000 apartments will be used by the city’s residents or will go on the market for rent or sale,” Collboni said of the measure.

Barcelona’s local government said in a statement it would maintain its “strong” inspection regime to detect potential illegal tourist apartments once the ban comes into force.

No new tourist apartments have been allowed in the city in recent years. The local government has ordered the shutting of 9,700 illegal tourist apartments since 2016 and close to 3,500 apartments have been recovered to be used as primary housing for local residents, it said. 

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Oil market likely to be in surplus next year, Morgan Stanley says

Oil market likely to be in surplus next year, Morgan Stanley says

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Oil market likely to be in surplus next year, Morgan Stanley says

The crude oil market is currently tight but next year will likely be in surplus, with Brent prices declining into the mid-to-high $70s range, Morgan Stanley said.

The tightness will hold for most of the third quarter, the bank said in a note dated on Friday, but equilibrium will return by the fourth quarter, “when seasonal demand tailwinds abate and both OPEC and non-OPEC supply return to growth.”

Three sources told Reuters last week that OPEC+ is unlikely to recommend changing the group’s output policy at a mini-ministerial meeting next month, leaving in place a plan to start unwinding one layer of oil output cuts from October.

Morgan Stanley said it expects OPEC and non-OPEC supply to grow by about 2.5 million barrels per day (bpd) in 2025, well ahead of demand growth.

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Refinery runs are set to reach a peak in August this year, and unlikely to return to that level until July 2025, it said.

Morgan Stanley left its forecast for Brent crude prices for the third quarter of 2024 unchanged at $86 per barrel. Earlier this month, Goldman Sachs also maintained its projection for the quarter at an average Brent price of $86 a barrel.

Brent crude prices on Monday were up 0.54% at $83.08 a barrel by 0535 GMT, and US West Texas Intermediate crude futures were up 0.54% at $80.56. 

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Asia stocks skid as China trims rates; Biden steps aside

Asia stocks skid as China trims rates; Biden steps aside

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Asia stocks skid as China trims rates; Biden steps aside

Asian shares slid anew on Monday, getting little lift from a surprise rate cut by China’s central bank, while Wall Street futures firmed in the wake of President Joe Biden’s decision to bow out of the election race.

The People’s Bank of China cut short-term rates by 10 basis points, which pulled down long-term borrowing costs and bond yields. The move follows Beijing’s release of a policy document on Sunday outlining its ambitions for the economy.

Investors seemed underwhelmed with the move, in part as it only emphasised how weak the economy was, and Chinese blue chips slipped 0.9% along with the yuan.

“Basically all the fundamental factors point to the fact that China needs a lower rate environment, especially the real rate is really high…in this kind of disinflationary environment,” said Gary Ng, Asia-Pacific senior economist at Natixis in Hong Kong.

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“I think the general trend is that it’s pretty much in line with the fact that the economy is not that great, and it seems that there’s a bit of urgency from the authorities to stimulate it now.”

MSCI’s broadest index of Asia-Pacific shares outside Japan lost another 0.7%, having shed 3% last week.

Japan’s Nikkei dropped 1.2% and South Korea’s benchmark index fell 1.3%. Taiwan was having another tough session with a loss of 2.3% amid concerns about US restrictions on chip sales.

Investors seemed much better prepared for news President Biden would drop out of the election race and endorse Vice President Kamala Harris for the Democratic ticket.

Online betting site PredictIT showed pricing for a victory by Donald Trump had fallen 4 cents to 60 cents, while Harris climbed 12 cents to 39 cents. California governor Gavin Newsom, another possible Democratic challenger, trailed at 4 cents.

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Markets took the news in their stride, with S&P 500 stock futures nudging up 0.1%, while Nasdaq futures added 0.2%. Futures for 10-year Treasuries rose 2 ticks, while 10-year bond yields dipped 2 basis point to 4.22%.

EUROSTOXX 50 futures added 0.5%, while FTSE futures firmed 0.4%.

“As Trump’s polling results have lifted, markets have favoured positions that anticipate more trade barriers and possibly higher inflation,” ANZ analysts said.

“Some polls have Harris performing better than Biden against Trump, and the Democrats will be hoping the next polls feature a Harris-driven bump.”

EYE ON EARNINGS

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A packed week of corporate earnings will see Tesla and Google-parent Alphabet kick off the season for the “Magnificent Seven” megacap group of stocks.

Others reporting include General Electric, General Motors, Ford and Lockheed Martin.

The tech sector is projected to increase year-over-year earnings by 17%, while profit for the communication services sector is seen rising about 22%.

Such gains would outpace the 11% estimated rise for the S&P 500 overall, according to LSEG IBES.

Europe’s biggest banks also report this week, with eyes on whether the gains from higher interest rates have run out of steam and if recent political drama is weighing on sentiment.

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A busy week for economic news will culminate with the Federal Reserve’s favoured inflation measure out on Friday. The core personal consumption expenditures index is seen rising 0.1% in June, pulling the annual pace down a tick to 2.5%.

Markets are wagering heavily that a benign outcome will firm the case for a September rate cut, which futures are pricing as a 97% chance.

Also due are figures for advance gross domestic product that are forecast to show growth picking up to an annualised 1.9% in the second quarter, from 1.4% in the first.

The closely watched Atlanta Fed GDPNow indicator points to growth of 2.7%, suggesting some risk to the upside.

The Bank of Canada meets on Wednesday and is considered almost certain to cut its rates by a quarter point to 4.5%.

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In currency markets, the dollar gave back just a little of last week’s safe haven gains as the euro edged up 0.1% to $1.0886. The dollar was a fraction softer on the Japanese yen at 157.27.

In commodity markets, gold held at $2,406 an ounce and short of last week’s record high of $2,483.60.

Oil prices inched higher, with scant sign of progress on a ceasefire deal in Gaza as Israeli forces battled Palestinian fighters in the southern city of Rafah on Sunday.

Brent gained 44 cents to $83.07 a barrel, while US crude rose 41 cents to $80.54 per barrel.

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FinMin Aurangzeb set to visit China to reschedule $15 loans

FinMin Aurangzeb set to visit China to reschedule $15 loans

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FinMin Aurangzeb set to visit China to reschedule $15 loans

 In order to reschedul energy loans worth $15 billion, Finance Minister Muhammad Aurangzeb is all set to visit China for three days tomorrow.

The minister will discuss the loan rescheduling with the Chinese authorities. The minister will also discuss China’s energy circular debts worth Rs500 billion.

Read more: Finance Minister Aurangzeb leads delegation to US for IMF talks on new bailout package

The minister will also discuss Panda Bonds during the visit to get the $30 million bonds in China.

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