Global 2023 Property Development Outlook: Housing Affordability Will Pressure Development
DBRS Morningstar’s negative outlook for 2023 reflects our view that credit risk profiles of the property development companies in our portfolio are expected to deteriorate, which may result in negative rating actions. Our cautious view reflects rising borrowing costs amid deteriorating housing affordability at a macro level, which is likely to pressure industry EBITDA margin performance in 2023. Under the spectre of deteriorating housing affordability, we expect property developers to continue to execute their backlog while making appropriate adjustments to their businesses in 2023 to better position themselves for when the housing market rebounds.
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