Yields in June presented some degree of stability.However, July is painting a different picture. Prime yields are continuing to move out across the board and apart from West End and City Offices,Shopping Centres and Regional Hotels, we expect further yield softening over the next three months.
Office yields in the City have stabilised in July and even [...]

Commercial Development Activity falls at new survey record pace, led by steep decline in private sector.

In July, around 40% of commercial developers indicated a reduction in overall activity compared to one month earlier, while just 6.6% reported a rise.development.
The resultant net balance – the Total Commercial Development Activity Index – fell to -33.8%, from  -32.4% [...]

EUROPE:
In line with the global slow down, the economies of Western Europe are also decelerating. For the moment, their occupier markets remain fairly robust, with healthy take-up in retail and logistics and, to a lesser extent, offices. However, forecasts for future growth are being downgraded and surveys of economic sentiment are now at their lowest [...]

Commenting on the Halifax House Price Index, Suren Thiru, economist, said:
 ”House prices fell by 1.7% in July. Pressure on householders’ income, together with a very significant reduction in mortgage finance due to the global financial markets crisis, is constraining potential house buyers’ ability to enter the market. This is resulting in both lower prices and [...]

No-one can deny that the UK’s housing market is currently enduring a period of value correction.Throughout this bulletin, we look at how the prime markets in London and across the UK have reacted to date and consider the timings and strength of their recovery. History shows that the prime markets behave differently to mainstream property (they are [...]

Commercial development activity falls at the sharpest rate in over five years.

Over five times as many commercial developers (40%) noted a reduction in total activity as those that reported a rise (7%) in June.
The resultant net balance  –  the Total Commercial Development Activity Index – posted -32.4% in June, down from -19.7% one month earlier. [...]

Despite unexpectedly strong GDP growth during Q1 2008, European economicactivity is anticipated to slow markedly over the rest of the year.
Eurozone inflation has been rising steeply, driven by escalating food and oil prices. In an effort to control inflation, the European Central Bank raised interest rates in July.
A mood of increased caution among office occupiers [...]

Overview: Yield Shift Spreads Across Europe: One of the clearest trends in Q2 2008 was that the effect of thecredit crunch on prime yields spread more widely across Europe, in terms of both location and sector. There are now very few cities where commercial property prices have not been affected and, while initially it appeared [...]

Rental Conditions Deteriorate

All Retail recorded the first monthly fall in rents since May 2001. With the office sector also showing negative monthly rental movements, All Property year to date rental growth is just 0.2% as of July.
Further outward yield adjustments means that All Property capital values are now 20% lower since their peak in June [...]

The report provides an assessment of the consequences of the credit crunch for property finance in London and the implications for policy. It demonstrates that:

The credit crunch is having a far-reaching impact on investment, development and occupational markets.
Given the effect of the credit crunch on the wider economy is still unfolding, the result for property markets [...]