The government’s empty rate tax could force commercial property values even lower, it has been claimed.
According to Bridging Finance, a Manchester based financial advisor, the tax will make banks even less likely to want to lend money.
A lender forced to repossess a property will then be faced with either selling it or paying the government’s tariff on it as an empty building.
“In the current climate this is a huge disincentive for banks to lend against commercial property,” managing director Chris Baguley told Property Week
He has called for drastic changes to help a struggling commercial property market.
“The empty rates tax will exacerbate the fall in commercial property transactions and prevent banks from lending to businesses that need to use their premises as security,” he added.
Research from De Montfort University showed the value of debt secured by commercial property increased to £207.9 billion.