Despite ongoing uncertainty and turmoil in 2012, prospects for the European economy in 2013 and beyond are less dark than expected. A strong recovery is certainly not for tomorrow, but the worst is now behind us.
European invested stock continued to grow in 2012, albeit at a modest 3% in Euro terms. The three core markets all grew, whilst CEE growth slowed. But, echoing macro trends, the periphery recorded another year of decline.
Deleveraging continued across Europe in 2012, with equity growth close to 5% and debt at 1%. Non-bank lending and corporate bond issuance expanded further, while traditionally dominant bank lending remained flat.
Property market sentiment remains mixed, as the macro outlook varies across Europe. Lenders are more cautious than investors in our annual survey. Highly selective lenders do expect growth in their loan books, but no better lending conditions. Investors feel buying opportunities have returned to normal and debt availability has improved.
|Section 1 – Stock and gap update||3|
|Section 2 – Market sentiment||7|
|Section 3 – Liquidity and value||11|