The reason, says eco-nomist Dirk de Vynck, lies in the decreasing income yields of listed property, which are pushing up the capital value of listed property.

Property unit trusts (PUTs) property outperformed nearly all key SA investment classes in the past five years, with average total returns of 18%. Property stocks listed on the JSE Securities Exchange are showing income yields of about 12%.

"PUT income yields have trended down at the same rate as bond yields. As with bonds, lower yields are good for listed property. Whe-ther this will continue depends on the rand and resultant inflationary view. A strong rand means lower inflation expectations, resulting in lower bond yields and lower PUT yields. Lower PUT yields trans-late into higher capital values, which is good news for listed property prices," says De Vynck. - The Star