Sentiment rises further in Q4, with NAB’s Commercial Property Index reaching a 2-year high (but still negative overall). Improvement driven mainly by office and retail, although both segments still under-performing. Sentiment edged up in all states bar Qld and SA/NT. NSW most optimistic state and set to remain so in next 1-2 years, but biggest improvement to occur in Qld. Industrial property to out-perform in next 1-2 years, with recovery in retail gathering steam. Capital and rental expectations generally lower in all markets (bar retail), but confidence among developers improving as financing conditions ease. Stock availability now the biggest challenge for property firms with concerns over financial/economic volatility and interest rates also up sharply.
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific's leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
