Going into the final quarter, sentiment in Asian real estate markets declined significantly as investors came to grips with the extent of the problems in the U.S. and European economies.
Transaction volumes across most of the region fell steadily during the year, with prices beginning to fall in some markets. This happened despite the fact that economies across most of Asia have been buoyant, if not overheated. Once again, therefore, Asia’s real estate markets are hostage to events elsewhere in the world.
Emerging Trends in Real Estate ® Asia Pacific is a trends and forecast publication now in its sixth edition, and is one of the most highly regarded and widely read forecast reports in the real estate industry. The report, undertaken jointly by PwC and the Urban Land Institute, provides an outlook on real estate investment and development trends, real estate finance and capital markets, property sectors, metropolitan areas, and other real estate issues throughout the Asia Pacific region. Emerging Trends in Real Estate ®Asia Pacific 2012 reflects the views of over 360 individuals who completed surveys or were interviewed as a part of the research process for this report.
Asian interviewees are rightly concerned about the impact in local markets of what is happening in Europe and the US. The short-term volatility creates opportunities - softening prices provide a chance to buy assets at attractive yields in markets with very strong long term growth potential. From a European perspective, Asia will also be an increasingly important source of capital. The rise of the Asian Sovereign Wealth Funds is highlighted in the report and has already had a major impact in Europe and in particular in London.