Currently, certain key markets are experiencing very high entry prices compared to the revenues generated by certain assets. It is important therefore to identify sectors with a limited offering and which could see strong growth in rents, while the risks take their toll on the economic climate.
In this context, an analysis grid should be created in order to identify the markets where prices remain affordable and/or able to benefit from a favourable evolution to the rental market. Drawing inspiration from the finance sector, Praemia REIM Research and Strategy has developed an original tool for its investment strategies: “factor investing”. This approach consists of taking into account 6 factors that we have adapted to the real estate world across 50 criteria.
The six factors and the criteria upheld are as follows:
- Quality (growth in employment, deliveries of Grand Paris Express stations, stock, economic indicators and user indicators);
- Growth/Momentum (prospects of total return and cost of finance);
- Volatility (data on vacancy, market concentration, the future additional stock, the speculative offering, the historic volatility of the return);
- Value (rental data and data on pricing);
- Return (data on the real estate rate of return and the risk premiums);
- Liquidity (data on the investment market).
The team
Henry-Aurélien Natter joined Praemia REIM as Research Manager in January 2018. He has the mission of developing the analyses of the Research & Strategy Department on the real estate markets, the economy and capital in France and in Europe.
Henry-Aurélien Natter began his career at Les Echos Etudes (formerly Eurostaf), then at C&W (formerly DTZ), and lastly at BNP PRE, where he acquired solid and varied experience in real estate research, strategy and finance. He is qualified with an AES degree in Business Management, a Masters Decree in management and SME management, and an International Master in commerce and marketing.
- Market review
Real Estate Convictions : Q3 2024
In October 2024, the ECB announced its third consecutive rate cut to ease its restrictive monetary policy, and we believe that a new momentum has opened up for the European real estate market. Indeed, this quarter we have seen a thaw in certain real estate indicators.
- Market review
Real estate outlook: October 2024
Over the last four years, we have been through a series of repeated crises. The unprecedented market context has reshuffled the cards between asset classes, and alternative real estate has emerged on the back of favourable fundamentals.
- Market review
Real estate convictions : 1st quarter 2024
For now, European real estate professionals have been cautious and are watching for the tipping point that could occur with the announcement of the first change in direction by the ECB.
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