Commercial property values in the UK set to fall in 2019

Lenders in the UK real estate market have anticipated a decline in commercial property prices throughout 2019. According to the latest Real Estate Market Trend Analysis report from Link Asset Services, political risk is the dominant factor, with uncertainties associated with Brexit.

James Wright, the head of real estate finance at Link Asset Services said: “Brexit has already weighed heavily on UK real estate market, and political risk is by far lenders’ largest concern. We are seeing many taking a far more cautious approach as a result, with fewer expecting to do more business, and many falling back into their core markets and products.

“It looks like, in the next 12 months, we’ll see lenders take a ‘softly, softly’ approach until there is greater clarity around the UK’s relationship with the EU, and economic and political fears calm.”

UK lenders are also predicting a poor outlook for residential property, with 61% expecting values to fall in the market. The research collected data from 100 respondents and discovered that three-quarters of lenders expect UK commercial property values to decline more than 2.5% during 2019, with 8% of respondents expecting the value to rise.

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