Weekly Market Insight

Latest Economic & Market Update 26th January 2021

26th January 2021

Good afternoon, it is January 26th 2021 and here is your economic and market update from BlackBee.

  • Build to rent more affordable and viable than build to sell – Society of Chartered Surveyors (SCSI)
  • Online retail traders lift GameStop and BlackBerry shares

SCSI report “Real Cost of Apartment Delivery” outlines the costs facing apartment construction in Ireland. A 2-bed low rise suburban apartment can cost €315,000 to build and up to €480,000 for a 2-bed medium rise urban apartment. These figures are excluding VAT. Such high costs are passed on to potential purchasers and often proving unappealing or unaffordable. If home buyers are accepting of this cost reflected in the purchase price, a mortgage is still required. The report derives that the build to rent model is more affordable and viable to apartment residents, however adding that build to rent is sensitive to market conditions and largely only viable in urban centres where there is high rental demand. (Source: SCSI)

Amateur online traders continue to add to the equity market rally, as seen by yesterday’s trading in GameStop and BlackBerry shares.  At present there is a large cohort of retail traders with high savings amounts, little avenues to spend due to lockdowns and access to low commission costs via online platforms. The two companies are often discussed on online message board Reddit. GameStop yesterday soared 120% yesterday before closing the day 18% lower. BlackBerry closed the day 28% higher. Institutional investors are aware that stocks are overvalued but are unsure how long this low interest rate and high savings rate fuelled bubble will last. (Source: FT)

Best & Worst Performers of Large Cap US Stocks on Monday
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Global Market Update
(as at close of markets 25/01/2021)