It will not be all doom and gloom in the property sector through 2008, according to funds manager, Maxim Asset Management.
Maxim Asset Management managing director Winston Sammut said that the main concerns impacting on markets related to financing issues, which, “in the fact of the sub-prime contagion, will likely result in rising interest costs”.
He said the likelihood of a recession in the US was also a concern and that investors would have to get used to more volatile markets, particularly during the first half of this year as well as re-adjusting tolerance to risk.
However, Sammut believes that the Australian economy is likely to fare better than most of the other major economies because of the impact of the resources boom.
He said domestic property assets, particularly commercial/office assets should benefit in terms of higher rental income streams being achieved or at the very least remaining stable.
“This is particularly the case in the Perth and Brisbane markets where the availability of additional new space is still a fair way out,” Sammut said.
He said that the listed property sector had now fallen close to 20 per cent since the end of October, 2007, and was considered to offer a number of attractive investment opportunities, but that picking the right stocks to invest in would be of paramount importance.
