Real Estate Outlook – APAC, Edition September 2022

APAC economic growth outpaced other regions in 2Q22. Inflation is rising but still modest and central banks’ reaction is not as aggressive as their western peers. Cap rates stayed firm but could rise in the next 1-2 quarters. We still see bright spots in the region that offer good investment opportunities.

Wai-Fai Kok, Head of Real Estate Research & Strategy – Asia Pacific

In 2Q22, APAC (excluding Japan) was the fastest growing region in the world. GDP grew 4.7% YoY versus 1.7% in the US and 3.9% in Europe. Notwithstanding, APAC is generally not overheating. The region’s average inflation rate of 4.5% is the highest it’s been in more than a decade, but still way below the high-single digits being experienced in western countries. This is a function of the region’s more measured re-opening approach and supply chain proximity to China, which is still largely trapped in the COVID-19 era. The pace of monetary tightening differs across the region.