Property seen maintaining its lead on JSE
Analysts say double-digit returns are again possible for real estate stocks in 2017, but potential pitfalls remain
The party may not be over for South African listed property, with prominent fund managers expecting the sector to remain resilient and even deliver double-digit total returns this year. Listed property achieved a 10.2% total return in 2016, strongly outperforming the JSE all share index’s 2.6%. It was, however, beaten by the 14% total return delivered by bonds. The head of listed property funds at Stanlib, Keillen Ndlovu, said he and his team expected the sector to achieve a total return of 8.1% in a base scenario this year, 14% in a bull scenario and 2.7% in a bear scenario. Meago Asset Managers director Jay Padayatchi agreed that listed property should perform well this year but warned of potential hurdles. "I believe that this year will undoubtedly be another volatile year, given global macroeconomic risks. Further, SA faces a significant amount of event-driven risk including potential Cabinet reshuffles, the ANC elective conference and potential ratings downgrades looming large ...
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