Big fall in value of business property; IN ASSOCIATION WITH Rensburg Sheppards Location.THE Royal Institution of Chartered Surveyors | The Royal Institution of Chartered Surveyors (RICS) is an independent, representative professional body which regulates property professionals and surveyors in the United Kingdom and other sovereign nations. (RICS RICS Royal Institution of Chartered Surveyors RICS Royal Institute for Chartered Surveyors RICS Right Intercostal Space (medicine) RICS Return Inventory and Classification System RICS Range Instrumentation Control System ) is predicting big falls in the value of commercial property in the UK over the next two years. In its latest report the RICS predicts the market will see a fall of at least 16% in capital values in 2009 and up to 10% in 2010. Capital values have already fallen 25% since the onset of the credit crunch Credit Crunch An economic condition whereby investment capital is difficult to obtain. Banks and investors become weary of lending funds to corporations thereby driving up the price of debt products for borrowers. in June 2007. This would mean steeper falls than in the recessions of the 1970s and early 1990s. Oliver Gilmartin, senior economist at RICS, said: "We are only halfway through the price correction in the commercial property market, with values set to fall through 2009 and 2010 as rental declines gather pace. "Transaction activity is set to rise, however, as more sellers become willing to accept lower bid prices." It says the biggest declines are likely to be in the office sector, with capital values expected to drop a further 30% to 35%, bringing peak-to-trough declines in excess of 60%. |
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