Property recovery: Stratified and Pockmarked

I can’t believe I’m about to say it…. But today I’m writing about niche recoveries in the property market, not the ‘whole’ market but rather that of giving an example of where we are seeing opportunity from an investment perspective. It is lonely territory because I have been so totally bearish on property for so long that a hint of bullishness is uncomfortable for me at this stage!

Recovery isn’t a destination, its part of a larger cycle, for every boom there is a bust, and for that reason we have spoken in the past about what recovery ‘might look like’ rather than ‘when’ it will occur.

The hallmarks of what a residential property recovery might look like are, in our opinion: property price stability in a range that is closer to traditional multiples of the average wage of the prospective buyer, a return of some inflation, rent price stabilisation (ideally tracking inflation) with yields at or above 6 to 7% and supply/demand dynamics in balance.

We don’t have any of those …

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