Skip to main content

Strong rental rises, but jump in yields weighs on values

While quarterly rental rises surprised on the upside in Q2, property yields also rose sooner than expected. This meant all-property capital values barely grew on the quarter and slowed to around 5% y/y, from almost 7% y/y in Q1. Given Q2 is likely to have been the peak in economic activity in the region, we expect rental gains will wane. With little sign that investor sentiment will improve and with interest rates set to rise further, a sharp slowdown in capital value growth by year-end is on the cards.

Become a client to read more

This is premium content that requires an active Capital Economics subscription to view.

Already have an account?

You may already have access to this premium content as part of a paid subscription.

Sign in to read the content in full or get details of how you can access it

Register for free

Sign up for a free account to gain:

  • Unlock additional content
  • Register for Capital Economics events
  • Receive email updates and economist-curated newsletters
  • Request a free trial of our services

Get access