The Danish Property Federation Market Statistics – Vacancy, July 2017
The Danish Property Federation Market Statistics
July 2017
WEB REPORT VACANCY
Results • Lowest economic vacancy in seven years • Annual decrease in vacancy of 1 percentage point • Other commercial has an economic vacancy of 7.7 percent • 3.6 percent in economic vacancy for residential The investment property market confirms economic growth
This is positive for the Danish companies and especially the investment property market where the demand for rentals is increasing. Hence the economic vacancy in July 2017 decreases to 8.3 percent in total, while the spatial vacancy decreases to 9.1 percent. This is the lowest level for economic vacancy since 2010 and approx. 1 percentage point lower than July 2016.
Following a six months positive development, the Danish economy is still looking reasonable. As in theh past years, Danish economy continuous forward in a steady pace. The international economy also shows progress. The International Monetary Fund (IMF) expect the global growth to be 3.5 percent in 2017 and 3.6 percent in 2018.
Significant improvement in economic vacancy
Based on the positive international state of the market and increasing international demand, the Danish Economic Councils expect that employment will increase by 30.000 in 2017. Furthermore, The Councils expect an increase in real wages and together with a historic savings surplus this gives way for an optimistic view on future private consumption and investments. The rest of 2017 and the coming years can provide stable economic growth based on domestic demand as well as export. The Economic Councils expect the average annual growth in Denmark to be 2.1 percent until 2025.
Since April 2017, the economic vacancy has decreased by 0.5 percentage points implying quarterly decreases since April 2016. We see the latest quarterly decrease within all sectors of commercial properties. Office has the highest vacancy among the commercial sectors, but decreases in July with 0.6 percentage points to 11.2 percent following a steady period from January to April 2017. Retail also has a decrease of 0.6 percentage point since April 2016. The decrease in vacancy is the result of the following three circumstances: Firstly, the relation between new hired rentals and new
Table 1. Vacancy rates in July 2017 Economic vacancy rate Vacancy (percent) Office Retail Industry
11.2
Quarterly change (percentage points) -0.6
Spatial vacancy rate
Annual change (percentage points) -1.2
Vacancy (percent)
Quarterly change (percentage points)
13.0
-0.3
Annual change (percentage points) -1.1
7.0
-0.6
-1.4
6.7
-0.6
-1.3
10.6
-1.5
-1.7
10.6
-0.7
-1.8
0.9
3.2
0.1
0.6
8.0
1.6
9.1
-0.2
Residential
3.6
0.3
Other commercial
7.7
-0.6
Total
8.3
-0.5
-0.9
-0.9
Source: The Danish Property Federation. Rem.: The Vacancy rates for all sectors also include actual annual rent and space for other commercial and secondary spaces. Published by
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