The property markets across the board are still in hibernation mode, according to the latest Rode’s Report on the State of the Property Market.
Some cause for optimism for shopping-centre landlords has been the recovery in retail sales volumes over the past few months.
The effect of the economic downturn on market rentals has now become strikingly evident.
Overall, the growth in market rentals for office space is still weak. According to the latest Rode’s Report on the SA Property Market, this is especially evident in Cape Town (6%) and Johannesburg (4%) decentralized, where rentals were, on average, lower than what they were a year ago. But, this comes as no surprise in light of the faster northward march of prime-office vacancies in these two decentralized regions.
The effects of softer economic activity on the demand for industrial space to rent, and consequently market rentals, are becoming strikingly evident.
In spite of the technical emergence of the economy out of the recession, the latest Rode’s Report on the Property Market (quarter 2009:4) reveals that rental markets in particular continue to feel the pinch of weak economic conditions across the commercial, industrial and residential arenas.
While property’s PR machine may have started talking about green shoots appearing, the facts reveal that the brakes − in terms of the growth in market rentals − are being applied more firmly now. This is according to data revealed in the latest Rode’s Report on the SA Property Market.
Industrial rental growth in all of the major industrial conurbations is fizzling out, with growth in stand values following suit.
Even as the income streams of listed property funds are still showing fairly robust growth, softer direct-property fundamentals will most likely hinder future distribution.
Speakers at this year’s popular annual Rode Property events countrywide had stern predictions for both residential and non-residential markets, with participants debating whether or not the ‘green shoots’ starting to appear in various sectors of the market are revealing any real indication of an upswing from rock bottom.