So far for 2006, global equity markets have returned (in United States dollar terms to the end of July) an average of six percent, with global bond markets giving investors only three percent. International property funds have shown over 10 percent growth for the same period. Rand weakness has helped local investors a little, with the rand depreciating nine percent against the dollar.
While negotiating the ever-present road works - as common a landmark today as the rolling green fields that flank the roads - on a recent visit to Ireland, we listened to an economic report on the radio. We had to cross a very busy intersection with no signage and no traffic officer in sight.
It was the Irish luck of the draw if you found a gap in the traffic.
This is not the Ireland I recall from earlier visits some 15 years ago, with its narrow, winding roads and crawling road speeds for the most part.
The Celtic Tiger, as Ireland has been dubbed, has grown explosively over the past decade and has drawn migrant workers from all over Europe. (For more about this phenomenon, visit the website www.esri.ie).
When I dropped off a document for someone at the social services department office in the small town of Youghal, every single person in the cramped waiting room was Polish. I know this because the official behind the counter called out for all Polish applicants present. All hands were raised except mine.
The Irish crime rate, notably drug use and (quite possibly related) violent crimes, is increasing, although it is rising off a low base. The government is at a loss as to how to fill the 50 000 jobs being created in the near future, despite the quality of higher education in Ireland.
There is lobbying within government for the relaxation of Irish immigration controls to facilitate the importation of certain skills. And, finally, there is debate about the pace at which Ireland's infrastructure - straining to facilitate growing economic activity and the resultant traffic on its roads - should be expanded.
There is a real concern that an even bigger building cost bubble is developing as too much money chases too few skills in too short a space of time.
Well, we know how that feels. I guess there really is no free lunch in economics, especially when it comes to growth.
As we listened to the debate on the car radio, I pondered the vast differences (apart from soaring building costs in both countries) between the South African economy and that of Ireland.
I wondered if we would ever face a four percent unemployment rate and the dilemma of too many jobs to fill.
But then, we too have experienced strain on our infrastructure, and a property boom. With the clear slowdown in US and South Africa residential property, and recent interest rate hikes, it is no wonder that investors have turned a little cool towards property as an investment.
If you feel a pinch from the interest rate hikes here, spare a thought for US property investors, who are paying 40 percent more on their mortgages than a year ago.
We have signs of over-speculation in certain areas of the property market here and particularly abroad ( www.condoflip.com), but the problem with many individual investors is that their assessment of this diverse asset class is dominated by their view on residential property alone.
Let's start with the local picture first. Do you recall the time when the earnings yield on the All Share Index (Alsi) was higher than the yield on long-dated bonds? It was in 2003, and it was the first time it had happened in 20 years.
The earnings yield on the Alsi is usually lower due to the potential for growth and tax implications - interest income on bonds is taxed. Investors were implying that they were not prepared to pay any more for a growth asset than for one where the government guarantees the investor a regular and steady interest payment.
That was a sign that equities were cheap if you thought interest rates weren't going to skyrocket or inflation get out of control.
Well, earlier this year the yield on listed property was lower than that of long bonds (it has been higher for most of the past decade). Unlike the situation with equities, a much larger portion of the return on listed property comes from income: both the yield at which you buy the units, and the growth in that income stream.
Capital growth is generally well below that of equities, and there are no guarantees that the income will flow in - leases can be cancelled, buildings can stand vacant. In addition, landlords may have locked in too-low increases in rentals for long periods of time, and during the inflationary times of the 1980s and early 1990s listed property did not fare so well.
In short, listed property brings risk, too, and to think that you can be satisfied with a much lower yield than a government bond was a signal listed property was expensive.
Then there were the two interest rate hikes, which sent bond rates higher, and property yields even lower. The listed property sector dropped by 20 percent in just over one month.
In the meantime, commercial rental growth and occupancies look solid. Ironically, this is due partly to the prohibitively high building costs, which can put a dampener on new supply coming to the market in the commercial sector.
You now find property shares with yields over eight percent. Compare that with the yield on residential rentals of well below five percent in some cases!
Enough about local listed property. In his column last week, David Sylvester also alluded to the re-emergence of value in the sector, especially for those looking for income (albeit taxed) as well as less hassle and administration than investing in property yourself.
I have given you a glimpse of how diverse an asset class listed property is. The picture would not be complete without some reference to the global picture.
Irish commercial property prices have grown by 13 percent per annum for nearly a decade, and the next contenders are Australia and Canada, at about four percent. (All those expats buying up office blocks and restaurants perhaps?)
There are some parts of the world where commercial property prices have declined on average for the past decade, notably Japan and Germany.
If you can find a way to include property in your offshore portfolio, a smart money manager should still be able to find investment opportunities in this non-homogeneous asset class.
Look a bit deeper when you think about property and don't restrict yourself to the local residential market. It can be a good diversifier, and pay a handsome income to boot. Just avoid "condo-flipping" for now and don't expect to pick the bottom of listed property prices just because they've gone down a lot - we're in more volatile times, so expect prices to fluctuate.
- Anet Ahern is the chief executive of Sanlam Multi Manager International