Freefall Unlikely to Turn to Bubble as Investors Return


Commercial property across the UK has staged a strong recovery in November, fuelling speculation that the property market crash of 2007 to 2008 might in the short-term be replaced not by a sustainable rise in values but by another bubble. Capital values for central London office space rose by 2.7 percent last month, equivalent to a yearly rate of 38 percent.

Whilst commercial property in London still remains a good investment in the long term, some critics have suggested that such sharp rises cannot be expected to continue throughout 2010, and new buyers who jumped on the bandwagon might be disappointed if they are expecting the kind of returns already seen in the sector.

However, industry chiefs such as British Land’s Chris Grigg have argued that the market is still low and a long way off such a condition – talk of a bubble ‘is more hype than reality.’

Photo: Jeff Kubina, Flikr