Decline in Commercial Property Could be Coming to an End
Posted on 03/08/2009
It is apparent that there is hope for the future of commercial properties in the UK. A decrease in the value of properties has been seen for about two years. However, it looks as if this is about to change. It is a good sign when one of the largest publicly traded property companies (Hammerson Plc) is hopeful about the future of commercial property sales.
The CEO for Hammerson Plc (John Richards) believes that a more steady return on rental properties is helping to stop the decline in sale values for houses. Landlords who buy-to-let are noticing less delinquent tenants and a lower incidence of tenants defaulting on their rental agreements.
John Richards believes that the housing market in the UK will continue to become more stable. This will be good news for both consumer and commercial property values. Hammerson Plc had racked up a £2.1 billion net debt during the troubling times for the commercial property market. They have slowly started chipping away at that debt as they have been able to sell properties at reasonable rates for the first time in a long time.
The upturn in commercial property values is the best news commercial property investors have heard since the summer of 2007. For nearly two years there was a drop of 44 per cent seen in the value of properties. In face a decline was noted each month. Even in May of the current year (2009), a 1.6 per cent decline was seen. However, this is much better than the large declines notes in prior months.
Properties that are in prime locations and excellent condition are starting to move on the commercial property market. There is every reason to believe that values for these properties will slowly being to increase. Companies such as Hammerson Plc, are very hopeful that they will be back to having success in the months to come.
Clear Lets, a leading property letting company in the UK can help you make sense of the current recession and how it has affected the property market. Visit us for a free property letting consultation whether you are a landlord wanting to manage your property professionally or a tenant looking for a good place to live.