Demand for prime commercial property continues to be high where funds are readily available, Fenn Wright Consultant Mark Sargeantson FRICS told the 2009 Property Seminar held at Trinity Park, Ipswich.

Speaking in November with property experts from law firm Birketts LLP and accountants PKF (UK) Ltd, Mr Sargeantson remarked that the market is now very much divided between the ‘haves’ and the ‘have nots’.

“ The commercial investment market consists of those with funds and those without,” he said. “ This is causing a significant yield gap between prime property, which is attracting sovereign wealth funds, pension funds and insurance companies, and secondary and tertiary property where the traditional purchasers are struggling to raise capital.

Turning to the residential property market, he said: “ The recent bounce in the residential market has ended for the moment, and pre-election uncertainty will have an impact on purchasers’ confidence. Lack of house building over the past two years will almost certainly result in shortages in years to come, helping to underpin value.

“ The mad buy-to-let boom is finally over and is unlikely to return on the same scale in the foreseeable future,” he concluded.

At the end of the seminar, delegates were invited to complete a survey outlining their own views on the state of the market.

Among these, two thirds predicted market recovery would take more than two years, with the remaining third suggesting it could take four years or more. There was indecision on the question of whether prices had reached their lowest point.

On other points, two thirds felt the Government should do more to help the market, and three quarters suggested scrapping empty property rates.
Birketts partner James Dinwiddy remarked that in difficult times, property transactions run less smoothly than in boom years.

“ It is the contract, whether a lease or another form of agreement, which will govern the relationship between the parties and the remedies open to them should a difficulty arise,” he said.

“ Anyone who fears they may be heading for a dispute should review the contract as early as possible and take advice on it and the unexpected twists implied by case law or statute,” he concluded.

PKF partner Peter Harrup wound up the seminar by saying: “ The property sector has been hit hard over recent years and I only hope this is borne in mind when Government looks around for ways to increase tax revenues over the coming years.”