Michael Kingcott
Head of Property Investment Strategy and Research, AMP Capital

All four major banks increased interest rates during October, citing their reason for the rate hike due to increased pressure from the Australian Prudential Regulation Authority (APRA) for financial institutions to adhere to the 10% cap on property investor lending growth. Given that we are set to be operating in a low-growth environment for the foreseeable future, investors should ensure that any downside risk is eliminated or mitigated.

The Australian commercial real estate market is benefiting greatly from the current low interest rate environment, with strong investment demand from both Australian and international investors. Leasing and consumer spending are improving in Sydney and Melbourne – where the largest concentration of property resides – but momentum is slower in the mining states as the commodities boom recedes.

An overview of our outlook for the sector is below:

Michael Kingcott, Head of Property Investment Strategy and Research, AMP Capital

Michael is the Manager of the Property Investment Strategy and Research Team, responsible for leading a team of property investment analysts who monitor and forecast the domestic and international property markets.

Important note: While every care has been taken in the preparation of this article, AMP Capital Investors Limited (ABN 59 001 777 591, AFSL 232497) and AMP Capital Funds Management Limited (ABN 15 159 557 721, AFSL 426455) makes no representations or warranties as to the accuracy or completeness of any statement in it including, without limitation, any forecasts. Past performance is not a reliable indicator of future performance. This article has been prepared for the purpose of providing general information, without taking account of any particular investor’s objectives, financial situation or needs. An investor should, before making any investment decisions, consider the appropriateness of the information in this article, and seek professional advice, having regard to the investor’s objectives, financial situation and needs. This article is solely for the use of the party to whom it is provided.