European property returns appear to be flattening out

After exceptionally strong returns in 2005, the European property market is showing signs of plateauing, according to Aberdeen Property Investors. Jon Lekander, head of investment strategy at Aberdeen, said last year was an "exceptional time" in terms of property returns, with a strong contribution from positive yield shift. However, he said yields were being driven down by strong investor demand and the decreasing cost of financing. He added: "We predict that unleveraged European property returns in 2005 were 12.6%, which would equate to an increase of 220 basis points on 2004. "Ire...