Commercial Property Market in Stockport

With the country facing uncertain times ahead this year, what is the state of the Commercial Property Market in Stockport?

Over the last 3 months the Commercial Property market seemed to be stabilising and started to show signs of recovery, so was their anything in the 2011 budget which could have any effect on the Commercial Property market in the next year in Stockport.

Whilst not in the budget one of the changes which might effect the Commercial Property market is the changes in the empty properties business rates,  if you had a property with a rateable value of  £18,000 or below and your Commercial Property was empty you did not pay any rates, this has now changed from the 1^stApril 2011 to £2600.

This means that if you have a property with a rateable value above £2600 you now have to pay rates even though your property is empty, this will have a big effect on the small landlords and small property owners, who were not paying out any sums for their empty properties but now find themselves having to start paying rates every month with no income coming in for their property’s.

This will mean some desperate landlords doing very low deals to get some money in just to cover their rates, this could then have an effect on the recovery potentially driving down rental values and capital values as a result.

I asked Philip Cooke a Chartered Surveyor and Director at Roberts & Roberts who have offices in Manchester and Stockport about the changes in the empty business rates and if this would have any effect on the Commercial Property market in Stockport,

Philip told me ‘It could depress the market again I hope the market will remain stable in the next quarter, Over the last 3 months the signs in terms of activity in viewing, sales and letting’s have been more active, people seem to have said well we don’t thing it going to get any worse so now is the time to start investing in Commercial Property to move their businesses forward.’

‘We are getting a lot more viewing but we are tending to find deals are very hard to complete, whether it be delays through legal’s or purchasers finding it harder to obtain bank funding.

Interest rates don’t seem to be part of the problem as these are still at relatively low levels.

Limited lending to investors is seen to be an issue as there used to be a lot of private investors in the market who purchased a significant amount of vacant commercial property, subsequently rent them out and hold the buildings as investments. But with certain lending institutions less inclined to lend for investment purposes there are significantly less investment deals out there.

With the new empty Commercial Property rates now in operation and seen as a new hurdle for property owners, confidence and bank funding seem to be the two major issues facing the market moving forward. Businesses will not want to buy new property unless they have the confidence that their business is going to do well, and in an uncertain market this is difficult to predict with absolute certainty.

 

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