UK – Property is continuing to outperform other asset classes, according to a report by Baring, Houston & Saunders.
In the year to May, property returned 2.9% against –4.6% for the All share and –0.1% for gilts.
Property is also expected to become even more attractive given the volatility in the equity markets at the moment, despite a recent softening of yields.
Though the report does point out that this year will see the low point of the current cycle with total returns between 6-8%, property forecasts are still well ahead of those for equities and bonds.
However, last year also showed a performance gap across sectors that was practically impossible to make up with superior stock selection.
Furthermore, according to the report, which examined the Investment Property Databank’s (IPD) results as a performance guide, those that got it right, “did well”, but those that got it wrong “were sunk”.