Aberdeen Asset Management this week said that the UK would lead the property market into a recovery phase in 2010.
Alessandro Bronda, head of property investment strategy at Aberdeen, said at the fund manager’s investment outlook presentation on Tuesday that yields would continue to move out in 2009 before stabilising in 2010.
“Yields will begin stabilising when the banks have been properly recapitalised,” he said. “We think the UK will be the first market to recover, and that some investors will move out of alternative asset classes such as hedge funds and into property and infrastructure.”
Despite the fact that it feels as though the UK will be the first to recover, Aberdeen said Asia should be the focus for global property investors because it would exhibit the strongest macroeconomic growth.
The company predicted that, in the five years to the end of 2013, Asia would provide the best returns, averaging just more than 9% a year. It said the UK would provide the second best returns, at just less than 6% a year, with Central Europe in last place with less than 4% a year.
Aberdeen head of global strategy and asset allocation Mike Turner said the company was advising clients to favour equities over property and fixed income investments, because that market was looking cheapest compared with long-term averages.
