Is quantitative easing creating asset price bubbles? Some economic soothsayers seem to think so. Cheap credit has pushed up prices in global commodity markets, the gold market and worldwide stock markets. But has QE affected international property? Are we also facing a global real estate bubble?
The 2008 debt crises heralded an era of all-time low interest rates for many North Atlantic countries. Others such as China, Japan and Singapore, have seen low rates for savers for some time.
It is little surprise then that residential property investments which yield gross income returns in excess of 5% (with expectations of longer-term rental and/or capital growth) have become an increasingly interesting proposition – not only to individual buy-to-let investors but also to funds and institutions seeking inflation-related income.
Source : Savills