The conflict appears likely to add to already troublesome global inflationary pressures, notably energy prices, said John Loos, property strategist at FNB Commercial Property Finance.
“For the residential rental market, the recovery can continue should the war impact be mild at worst, but this market’s tenant population cannot handle too big an economic impact before tenant rental payment performance starts to suffer again.
“While industrial property may weather an economic storm of moderate proportions, the fragile retail and office sectors, challenged by increasing online retail and greater remote working respectively, could quite easily see renewed weakness that could return them to rising vacancy rates and further downward pressure on rentalsm.”
Apart from higher inflation eating into consumer incomes that are already under pressure from a weak economy, rising interest rates lift the cost of servicing debt, further eating into incomes. The war could potentially add to these pressures that have already been mounting, he said.