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Editorial Comment
Small is beautiful – or maybe not!
It seems impossible – 3,000+ new homes, 33 more high blocks of apartments and all projected to come on stream on The Rock within three years! Half will be in the private sector and almost two thirds of those in small 1-bed or studio flats.
With constant concern that the Spanish border with Gibraltar will be, at best, an irritant for the 12-13,000 workers who make the journey daily to the Rock, it is no wonder that the British territory is anxious to supply “affordable” accommodation so that the trip becomes unnecessary. The surprise for many, however, is that developers, encouraged by Gibraltar’s government, believe so many want to swap homes in southern Spain’s open spaces for the relatively restricted, tightly-packed Rock.
Yet, if the quick take-up of small units priced from £125,000 is any indication, there is very strong demand. The worry for some is that speculators or local investors are buying those units primarily with the idea of off-loading them when the buildings are near complete. Not only will there have then been an anticipated 10% minimum price uplift, but also some uncertainty as to whether small units will actually attract so many ‘real’ buyers – people who want to live in them.
The government is looking after its own by building another 1,400 or more of 50-50 shared ownership, mostly 3-4 bedroom family apartments, by 2021, but only those non-Gibraltarians with 10 years residency will be eligible to buy the “affordable” properties that involve a personal investment half that of the open market studios now being built. Those people already crossing the border, or anyone attracted to relocate and work in the jurisdiction’s fast-developing, new DLT (Distributed Ledger
Technology) start-up sector, or the expanding finance centre and eGaming firms, will only be able to find similar larger properties in the private sector costing at least three times more.
No wonder Housing Minister, Samantha Sacramento, says her homes are sold at “very good prices”!
There is a more general expectation now that Spain, the UK and Gibraltar will come to an agreement over border fluidity and joint use of the airport in tandem with Brexit arrangements, although it is by no means certain. In that event, the need to live in Gibraltar becomes less pressing for non-Spanish frontier workers and then simply a matter of location preference – and individual affordability.
Indeed, there have been positive discussions with some Gibraltar insurers with a continuing need for ‘passporting’ arrangements within the EU post-2020, to consider conducting some of their work just over the border in La Linea. They could, for example, retain back-office staff in Gibraltar and key executives cross the border for part of the day to deal with EU business in a Campo office. This would make it unnecessary for separate offices to be established and staff recruited in less accessible places, such as Luxembourg or Malta.
Gibraltar already has a Memorandum of Understanding with La Linea, where unemployment is high, to jointly explore and promote business development either side of the frontier.
For some Gibraltar financial service firms, there may be new meaning to having ‘a foot in both camps’!
Ray Spencer
Published by Gibraltar International Publications Ltd. 21 Bell Lane PMB 104, PO Box 561 Gibraltar, GX11 1AA
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4 Gibraltar International www.gibraltarinternational.com
Contents
News p6
Guarantees protect UK market access post Brexit
FinTech p8
2018 – the year of ICO governance
Law p10
Revolutionary changes coincide with caution over ‘disruptive’ technology
May/June/July 2018
Volume 24/Number 2
FinTech p14
Widespread endorsement for world pioneering token regulation
Property p18
3,000 home property boom targets local families and cross-border workforce
Tax p26
UK property ‘levelling the playing field’
Business round up p29