Retail sentiment dips but offices on the up
Sentiment in the commercial property market edged lower in the second quarter, with different views emerging on the health of the surging office market and the more challenged retail property sector.
Retail property sentiment hit its lowest point since late 2014, down 11 points to +6, according to the NAB Commercial Property Index for the three months to June 30.
“Retail is the least confident segment and this is in keeping with our outlook for household consumption given headwinds from elevated household debt and a continuation of subdued wages growth,” NAB group chief economist Alan Oster says.
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Survey participants also tempered their expectations for retail rent growth, while office rents are set to grow fastest.
Office market sentiment remained positive, adding four points to +39, as survey participant expect office rents to grow faster than rents for other types of space.
Overall sentiment slipped four points to +23, still well above the long-term average of +1.
By state, confidence improved in the resources states of Queensland and WA. Sentiment improved most in Victoria and slipped in NSW from a high base.
Those surveyed say it is harder to access debt than at any time since late 2011.
The survey covered about 260 participants including developers, fund managers, landlords and real estate agents.
This article originally appeared on www.theaustralian.com.au/property.
