While all property returns suffered a 9.1% decline in 2022 as yields rose substantially in the second half of the year, we expect the current period of repricing to come to an end towards the middle of this year.
Given strong fundamentals of investment and occupier markets across several sectors, we forecast total returns to increase this year by 5.3%.
Highlights in our latest REIF include:
- Total returns growth will average 8.6% pa over the next five years
- Further outward shift in yields in H1, but stabilisation in H2
- The property yield/gilt spread will widen to +300 bps by 2025
Read more in our Q1 2023 UK Real Estate Investment Forecasts report.
