Hot Topic of the Month - April
COMMERCIAL PROPERTY
HOT TOPIC OR HOT POTATO
GENERAL PROPERTY POSITION
As everyone has heard repeatedly over the last 12 months or more, the problems
of the banking sector came to a head due to bad debts in the American mortgage
market.
Effectively, this was a pinprick but we all know what pins do to balloons.
Is this a message of despair? No.
The press seem to forget that properties do not disappear, the bricks, mortar
and concrete are still standing and the vast majority of the buildings are full
of people (quite scared people) working hard to earn a living. Rents are under
pressure but are not tumbling down and reviews are still showing growth. After
all, most rents are only reviewed every 5 years. As with all cycles, what goes
down will go up again.
Over priced properties of two years ago are now becoming sensibly priced investment
opportunities.
BUSINESS RATES
Over the next 6 months, there are a number of issues for the ratepayers to watch
for and decisions to be made.
For occupiers the costs of occupying are still going up. Business Rates have
increased by 5% (or more in some cases) due to the RPI increase based on September
2008 statistics. The Government have announced that up to 60% of the increase
will be deferred (if requested) and spread over 2010/11 and 2011/12 rates years.
Although welcome relief for some, it does not mean that the increase has gone
away. The details are not yet available and the necessary regulations will not
be set before Parliament until July, or so we are told.
Next year sees the start of a new Rating List, with all Non-Domestic properties
having a new Rateable Value coming into force on 1st April 2010, based on rents from 1st April 2008. The draft Rateable Values will be available in the autumn.
If you have not looked at your rates bills yet, don’t forget you have a right
of appeal, which may be back-dated to 1st April 2005. That right runs out on 31st March 2010. It is always worth reviewing, but take qualified advice.
Colin Hunter - Director of Storeys SSP
Harrogate