Listed property returns strong in April but super funds heading for end-of-financial-year loss

Listed property investment returns were strong in April, but superannuation funds may deliver an end-of-financial-year loss for members, according to research firm Chant West.

Chant West is forecasting super funds financial year to date returns to fall into the red by about -0.5% as a result of the recent global sharemarket woes due to fears that Greece will default on its debts and exit the eurozone.

In its April update, Chant West notes that share markets, the main drivers of growth fund performance, were mixed in April with the Australian share market gaining 1.3% but international shares were down 1.6%.

Listed property performed strongly though with Australian REITs advancing 5.4% and global REITs up 2.8%.

“Superannuation funds were up over the first four months of the calendar year on the back of strong share markets,” explains Chant West director Warren Chant.

“However, in the first half of May we have seen world markets slide on renewed fears that Greece may need to default on its debt and exit the euro zone.

“As a result, we estimate that the median growth fund is down 3% so far in May, bringing the financial year to date return into the red at about -0.5%.

“What that means is that the likelihood of a third consecutive positive financial year return is now in serious jeopardy, with a lot hanging on the outcome when Greece goes back to the polls in June,” he says.

Last financial year super funds delivered average returns of 9.2%.

For end-of-financial-year tax tips for property investors, sign up for tomorrow’s  free webinar (May 23) at 12.30pm.