Catalyst Securities, which compiles monthly reports on the listed property sector, said on Thursday these returns had been driven by high levels of income distribution growth, which in turn were fuelled by significant savings on debt funding costs.

Catalyst MD Andre Stadler said they were also fuelled by improved property market fundamentals in the form of reduced vacancies and rental increases.

Total returns include unit price appreciation and income distributions.

Stadler said that over the past four years the listed property sector had delivered total returns of about 30% a year, making it one of the top performers on the JSE. Last year the sector delivered a total return of 41,26%.

In its latest report on the listed property sector, Catalyst said listed property loan stock Redefine Income Fund was the top performer in terms of total returns for October. Redefine recorded a total return of 13,63%.

Listed property loan stock Metboard Properties was the next best performer with a total return of 10% for the month.

Stadler said the listed property loan stock sector performed better than listed property unit trusts on total returns for the year to date.

The property loan stock sector recorded a total return of 42,29% for the year to date, whereas the property unit trust sector had delivered a total return of 29,96%.

Stadler said that this difference in total returns highlighted "the impact that savings on debt funding costs, brought about by interest-rate cuts, are having on the higher geared property loan stock funds".