16/08/2012
Content category: Commercial landlord insurance
Now could be a good time for prospective landlords to branch out into the UK commercial property sector after one industry expert claimed the sector is managing to hold up, despite economic difficulties across Europe.
According to Ed Stansfield, property economist at research consultancy firm Capital Economics, there does not seem to have been little in the way of falls in rental values outside the smaller markets in recent months, although it is too soon to tell.
The trusted expert claimed the commercial property market tends to react to developments in the wider economy, as one of the key drivers of this type of lending is employment - which responds to changes in output.
However, Mr Stansfield claimed the overall performance of the market does not mean the industry has fully recovered, with further economic troubles likely in the majority of European counties going forward.
His comments were made after Shirley Ghan from Jones Land LaSalle revealed the financial struggle has been reflected in commercial property markets, which have experienced a difficult period in the first half of 2012.
She said the latest quarterly market indicators suggest prime office rents suffered a second consecutive contraction between April and June this year, while stating that the situation may not be as bad as expected during a recession.
Echoing this sentiment, Mr Stansfied said there are still risks associated with investing in rental property - as activity is continuing to slow through the third quarter, meaning the worst cases of downward pressure on rents may not have been seen.
"There are areas where the market is going to perform better than others and that will generally be the larger more liquid markets - for property, at least - that are not directly exposed to complications from the potential of a eurozone break-up and a reversion to national currency," he added.
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