4 March 2009
Catella Spring 2009 Property Market Trends is now available
In the eye of the storm
• Yield requirements continue to rise. Helsinki's Prime office yield rose from 5.1 % to 5.5 %. Clearly the yields of riskier objects have risen more while their values have decreased.
• In the Helsinki Metropolitan Area the office vacancy rate has changed direction and started to climb. The rise of the vacancy rate in office premises was led mainly by the surge of new construction. We forecast that the vacancy rate will continue to rise in 2009, when the effects on the problematic real economy are seen in the user market. The vacancy rate in retail and warehouses are also on the rise in the HMA, but they remain at a low level.
• Demand on the investment market has dropped noticeably. The lack of demand has also lowered the price level. The transaction volume in 2008 was € 3.7 billion, which is approx. 40 % lower than the volume in 2007.
• Banks have a strong influence on real estate development in the current market situation. Financing is difficult to obtain at the moment and the higher loan margins are negating the interest rate advantage.
• The real estate markets in the growth center were still in relatively good shape in the second half of 2008. The office vacancy rate in many growth centers fell. It is however typical that the office market react to change slower than the HMA market.
The spring Property Market Trends is available for download by clicking the link to the right. The review is available in Finnish and in English.