Aberdeen Property Investors expects UK property to outperform in the next five years, followed by the Nordic region and the eurozone. Prospects for Central Europe remain weakest, due to sharp economic contraction and the withdrawal of capital by foreign investors, according to the company's latest European Property Snapshot.
Aberdeen Property Investors expects UK property to outperform in the next five years, followed by the Nordic region and the eurozone. Prospects for Central Europe remain weakest, due to sharp economic contraction and the withdrawal of capital by foreign investors, according to the company's latest European Property Snapshot.
Another key finding is that the pace of decline in capital values across Europe is beginning to slow. 'We still expect another weak 12 months for property market returns, driven by sharp falls in rental levels and further falls in capital values, before the market fully recovers.'
Aberdeen expects capital values in the eurozone will continue to fall, but at a slower pace while the UK is now stabilising. 'The UK has already re-priced significantly, with capital values having fallen by 45% since summer 2007,' the report said.
John Danes, head of UK Research and Investment Strategy, noted: 'The pace of capital decline for European property has slowed over the past quarter. We project that capital values will stabilise in most markets by mid-2010, and healthy total returns will be delivered thereafter, aided by a strong income return.'
