Lower government bond yields improved the relative valuation of commercial property markets for the third consecutive quarter. Less than one fifth of markets look overvalued, with more than half of industrial markets fairly valued. Since the end of Q3, bond yields have risen, which will weigh on property valuations in Q4. However, in the longer term, our expectation that government bond yields will stay low means that European property is likely to remain at, or close to, fair value.
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