"Too soon" to expect property market recovery

5 February 2010

Although signs of a recovery in the UK property market were evident towards the end of 2009, its too soon to expect that to continue, accountancy firm BDO has said.

Key underlying factors will continue to cause turbulence in the market, property experts from BDO have said.

“Although we are seeing higher investment returns and a more stable tenant market, we still have a long way to go before we are at the number of transactions that we saw pre-recession,” says Solly Benaim, head of real estate at BDO.

“The combination of an election year, which is bringing considerable uncertainty across industry sectors, coupled with continuing fears about unemployment and consumer spending, and concerns over rising taxes later in the year all have the potential to undermine the commercial property market.”

However, Benaim said that there were some reasons for optimisim, with development activity showing signs of improvement towards the end of last year, while increased lending is available, although in more limited quantities and at higher prices.

“We believe that it will be a long, slow recovery in the market,” said Benaim.