Sharp falls in property yields and an improvement in rental growth pushed CEE all-property values in Q4 up almost 5% q/q, the strongest quarterly growth rate since 2007. This was largely driven by the strength of industrial, but office values also increased strongly. Property values are likely to rise further in 2022, but at a slower pace. Decelerating economic growth, large supply pipelines and structural changes will limit rental growth. And further rises in interest rates and bond yields means that the turning point for property yields is getting closer. That said, the downside risk to Moscow property has greatly increased with the invasion of Ukraine.
Note: Russia-Ukraine Drop-In (today at 09:00 EST/14:00 GMT): We’re holding an online briefing on the crisis and its economic and market impact today at 14:00 GMT. Register here.
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