US mortgage rates hit 6 per cent this week, the highest level in 14 years, adding to fears about the housing market. But Americans live in a socialist paradise. Homeowners are shielded from rising interest rates by 30-year government-backed fixed deals. When rates fall, the mortgage can be refinanced, locking in cheaper payments. When rates rise, no pain is passed on.

Most of the world lacks this insulation. Refinancing at a higher rate is an increasingly grim prospect for individuals and companies alike.

Fitch has warned that borrowers in the UK, Spain and Australia are especially exposed, with between 42 per cent and 93 per cent of mortgages tracking central bank rates or with short-term fixed deals set to expire.

This sounds like bad news for the banks. But the consensus is the opposite: margins will improve as lenders jack up rates for borrowers while passing on crumbs to depositors.

China’s local government financing vehicles are rushing to buy vast quantities of land with borrowed funds, bailing out cities and provinces struggling for cash after an exodus of debt-stricken private sector developers.

The spending spree has been unleashed in the run-up to President Xi Jinping’s expected appointment to an unprecedented third term next month and highlights efforts to boost the pandemic-hit economy, which grew just 0.4 per cent year on year in the second quarter.

Local governments have traditionally relied on LGFVs to support growth by spearheading infrastructure investment. Now, the financing vehicles are being called upon to prop up the real estate sector, which accounts for about one-third of total economic output.

According to official data, land acquisitions by LGFVs rose to Rmb400bn ($57bn) in the first half of the year, up more than 70 per cent compared with the same period in 2021. This is despite overall land

High inflation is cooling the UK’s housing market and bringing an end to the frenzied period of property-buying which played out during the pandemic, according to housebuilder Redrow.

“We had two years of an extraordinarily strong market. It’s fair to say it’s now normalised,” said Matthew Pratt, chief executive of the FTSE 250 group.

Redrow reported underlying pre-tax profit of £410mn for the year to July 3, up almost a third on the £314mn recorded in the previous year as revenues rose 10 per cent to £2.14bn. However, statutory pre-tax profit fell as the company set aside £164mn to cover historic fire safety issues.

The jump in underlying profits was driven by high housing demand. Transactions surged during the pandemic as buyers looked for larger homes or properties further from their offices and those who had been able to save during lockdowns invested in houses.

That has been a particular

Rising rents and utility bills are boosting interest in smaller, cheaper rental properties at the expense of larger, more expensive houses in the UK, according to research from the property portal Zoopla.

The data, published on Tuesday, showed that 35.4 per cent of inquiries to estate agents about properties in July and August this year were about two-bedroom flats, up from 29.8 per cent in 2020.

In the same two months, the proportion of inquiries about three-bedroom houses was 12.1 per cent, down from 15.9 per cent in 2020.

The figures come amid growing criticism of the state of the housing sector, with soaring rents leaving more tenants at risk of eviction because of the cost of living crisis.

Richard Donnell, Zoopla’s executive director of research, said rents had “surged ahead” over the past year, although there were signs that the pace of growth was peaking.

“Renters are responding and

Hong Kong’s property developers are having to construct more flexible leasing offers to attract businesses, as the city faces more than 246 football fields of excess supply of office space by 2025.

With Covid-19 isolation policies tipping Hong Kong’s economy into recession, companies and banks such as Société Générale and Deutsche Bank have downsized in the territory over the past two years. Pandemic measures have also caused an exodus of foreign and local residents and paused the return of mainland Chinese groups, which had been expected to take up space.

“The leasing market, if [it’s] not at the bottom, it’s reaching the bottom, and will remain for some time. There’s a lot of space to absorb and digest,” said Paul Yien, executive director of office leasing advisory at JLL in Hong Kong. “There is a lot of new supply . . . which means rental will be under pressure.”

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Hong Kong’s property developers are having to construct more flexible leasing offers to attract businesses, as the city faces more than 246 football fields of excess supply of office space by 2025.

With Covid-19 isolation policies tipping Hong Kong’s economy into recession, companies and banks such as Société Générale and Deutsche Bank have downsized in the territory over the past two years. Pandemic measures have also caused an exodus of foreign and local residents and paused the return of mainland Chinese groups, which had been expected to take up space.

“The leasing market, if [it’s] not at the bottom, it’s reaching the bottom, and will remain for some time. There’s a lot of space to absorb and digest,” said Paul Yien, executive director of office leasing advisory at JLL in Hong Kong. “There is a lot of new supply . . . which means rental will be under pressure.”

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