Further improvements in sentiment in both the occupier and investment segments of UAE real estate market show that the tone in the property industry is continuing to gain ground, it says.
This is reversing the negative pattern that characterised the market from the back end of 2009 through till the middle of last year.
In contrast, the picture in Brazil is rather more downbeat, particularly in the occupier market where the headline sentiment indicator dropped to –39 from –28. It has now been in negative territory for three successive quarters, reflecting softer numbers on both tenant demand and rent expectations as well as higher figures for inducements.
However, the Brazilian investment market is continuing to display a greater degree of resilience. RICS data suggests that property investors are for the time being willing to take a longer term view of the prospects for the economy.
The results for Asia show promise, with Japan leading the way on the investment side while also delivering a strong result for the occupier market helped by the dramatic policy initiatives being introduced by Prime Minister, Shinzo Abe.
RICS says that the fear that the survey picked in for the first quarter of the year surrounding the widening of the stamp duty net in Hong Kong to the commercial sector appear to have eased somewhat.
Headline numbers for China remain generally firm despite a slight loss of momentum in the economy and growing concerns over the rapid increase in credit with the investment indicator more positive than the occupier measure.
The real estate picture in India holds broadly flat, reflecting a degree of caution in the sector as the central bank grapples with the challenge presented by a subdued economy and volatility in the currency.
In Europe headline indicators generally remain weak for both the occupier and investment markets reflecting the ongoing recession in the region. Germany, Europe’s largest economy, continues to be an exception in terms of the growth outlook and sentiment within real estate. It remains increasingly attractive to investors with the RICS Investment Sentiment Index climbing from 18 to 22.
Results for the United States are encouraging, the report says, with further evidence of rising investor appetite and stronger tenant demand driving both rents and capital value expectations in an upward direction despite some mixed economic data. Meanwhile, the numbers for Canada remain generally firm.
Finally, in Australia the occupier index remains in negative territory and to a greater extent than in the first quarter of 2013 as the economy continues to disappoint while the investment index is slightly positive but less than was previously the case.
‘The latest numbers demonstrate that the recovery story is continuing to gain traction in both the UAE and Japan and that real estate markets across much of Asia and in the US remain generally positive,’ said Simon Rubinsohn, RICS chief economist.
‘The turmoil that was evident particularly in financial markets in the emerging world as Ben Bernanke raised the prospect of scaling back on his quantitative easing programme has as yet had little impact on physical property,’ he pointed out.
‘However as US monetary policy gradually moves onto a slightly more restrictive trajectory, there is a risk that the less benign financial conditions will have an impact on some of the more vulnerable markets,’ he added.