South Africa has been voted the most vulnerable emerging market in the world.
Analysis by CNBC highlights Brazil, India, South Africa, Indonesia and Turkey as the five most fragile emerging markets. They share key features, notes CNBC, as the cost of employment rises, while foreign investment dips and exports reduce.
Out of the world’s emerging markets, a poll of investors carried out by The Economist pinpoints South Africa as the most vulnerable, notes a chief economist at the Old Mutual Investment Group.
A housing shortage has left South Africa’s property market facing a large demand for rental accommodation, while many investment reports have recently ranked the country as a hotspot for real estate investment. But with affordability concerns and laws that “may be regarded as being too friendly towards defaulting tenants”, the ability of the market to provide strong returns is called into question by IOL Business .
“South Africa’s listed property is significantly underweight in its exposure to residential property and Octodec and Premium Properties are currently the only listed funds with exposure to this sector of the property market,” reports IOL Business Report.
Octodec and Premium Properties are currently rumoured to be merging. If the merger does occur, predicts it will raise residential property’s investment profile.