IPD reports 15-year low for UK property returns

According to the latest UK Monthly Index from the Investment Property Databank (IPD), the country's commercial property delivered no monthly return in August for the first time in almost 15 years. While the year-to-date total remains at 4.6%, the income return of 0.4% was cancelled out last month by a fall in capital growth of 0.4%.

Returns on industrial property returns were negative for the first time since August 1995. In this sector the total return was -0.2%, with capital growth at -0.5% and income return at 0.6%. With total returns of -0.2%, the lowest level since September 1992, retail property continued its recent decline. The office sector was alone in outperforming, but even here the total return of 0.4% represented a significant fall from the figure of 0.7% for July. The IPD reports that all-property total returns stand at 9.9% year on year overall, the lowest since September 2002.