Buyer-seller mismatch will keep investment slow

Asia-Pacific property will endure a slow, uneven recovery. Elevated risk-free rates and soft regional growth will restrain capital appreciation, leaving income as the primary engine of returns. We forecast Australia to lead with 6% p.a. all-property total returns in 2025-29, with Korea and Singapore close behind. Japan will still produce respectable returns despite modest interest rate rises, but Hong Kong will diverge sharply with negative total returns on the back of structural economic headwinds. Across sectors, apartments are the only sector to deliver capital growth and therefore sees the strongest total returns.