From a report released by MSCI Inc, an investment research company, the statistics made available to the public, shows that returns from the property sector in Botswana dropped.
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According to the report, the property sector, posted a return of 11.5% in 2014, a far cry from 21.5% in 2013.
Also capital growth declined to 2.0% a sharp decline from 10.2% recorded the previous year.
According to Stan Garrun, Head of South African Real Estate, MSCI, “Our figures show that the falls in total return are being seen across the board, with all of the main sectors experiencing a similar drop in the region of 1000 bps.”
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The report also shows that the top performing sector is the industrial real estate sector, that posted a return of 16.8% with a capital growth and income return of 5.9% and 10.3% respectively.
Garrun added that 'Landlords are seeing a rise in passing rents, particularly within the Retail and Residential sectors, which is in line with inflation. Capital value growth declined in all property sectors though still positive at 2.0% on aggregate. This slower growth reverses the bullish view of the year before, perhaps reflecting a more cautious attitude among valuers after a run of particularly strong returns for the three years ending December 2013. The data for 2014 shows that the market is normalising.'
He also said 'Despite a fall in total returns across the board, it appears that the factors that support the property sector (low vacancy rates and rental yield) remain strong.'
