Our forecast is that all-property total returns will decline from 15% in 2010 to around 8.5% this year, before easing down to between 6% and 7% in both 2012 and 2013. This subdued outlook reflects our view that, while the property market is not starting from a point that is obviously too cheap or expensive, the weak economic backdrop will limit the scope for rental value growth. At the sector level, reflecting the recent surge in the development pipeline, we think there is now a very real risk that Central London office rents and prices will begin to fall in 2013.
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:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services