Deep Dive: Property markets in this recession are not like 2008

Property acting more like a bond

Eve Maddock-Jones
clock • 5 min read

Fears of recession are increasing in most major economies, with the US already in a technical one, and when the property sector is thrown into the mix flashbacks to 2008 occur. But going into this recession, experts told Investment Week that property is in a very different state than it was pre-GFC - in a good way.

Philip Matthews, the manager of the Wise Multi-Asset Income fund, went so far as to say: "We believe any comparisons to the performance of the sector in 2007/8 are misplaced." He explained heading into 2008 the sector had been bolstered by five years of significant growth in asset value, while shares sat at a premium to those inflated levels. Running parallel to this, gearing within the sector reached "eye-watering levels that provided no downside protection", with some property portfolios yielding the same amount as a UK government bond. Bank of England predicts recession as it en...

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