Despite some risks, the economic environment in Asia Pacific remains mostly healthy through 2017. China and India are both achieving real GDP growth of 6-7% y-o-y, and investment demand has been firm in most major Asian centres. Hong Kong’s economy has been improving due to strong domestic demand and Australia remains an appealing destination for global investors.
In 2017, the continued weight of investment capital should further depress yields across Asia Pacific despite likely upward pressure on interest rates in various markets from now on. A potential risk for the Asian property markets lies in the US. While the near-term prospect of continued growth, rising interest rates and US dollar strength could well be positive for the region’s exporting nations, should threatened trade tariffs materialise, they may become a significant potential danger. However, we are optimistic about the region’s prospects and, bar a few exceptions, believe that 2017 will be another positive year for the Asia Pacific property market.