RICS commercial property monitor results Q3 2024: Are global real estate markets in early recovery?

The Commercial Property Sentiment Index for Q3 2024 tentatively points to global real estate markets moving towards a more positive trajectory. However, the latest survey results indicate considerable variation in the outlook for the next 12 months regarding different regions, countries and sectors.

Showing the least negative overall reading in two years, the survey highlights early signs of the positive impact on real estate markets from interest rate cuts in many of the world’s major economies.

Regional and country-level data shows considerable variation in sentiment however, with an upbeat trend recorded in the Middle East and Africa. At the aggregated level, sentiment remains the least positive in APAC. However, country-level sentiment highlights substantial divergence between strong confidence across India and weak conditions in Hong Kong and China.

With concerns over inflation moderating and interest rates coming down, respondents also report a slight improvement in credit conditions, paving the way for an increase in investment enquiries. This suggests that an uplift in buyer activity could continue to gain ground in the coming months.

Despite this more positive, albeit regionally varied, trend in overall sentiment, real estate professionals remain cautious, with instances of distressed sales still expected to rise in the coming 12 months. Overall sentiment indicates secondary office and retail are the most vulnerable, while there is optimism around data centres and aged care facilities.

RICS’ Global Commercial Property Monitor is a quarterly guide to the trends in the commercial property investment and occupier markets. The report is published alongside other RICS surveys covering the housing market, residential lettings, commercial property, construction activity and the facilities management market.

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