Investors in the commercial property market are being warned that a downturn could come sooner than expected ? leaving punters who have invested for the short-term high and dry.
The warning comes from experts at Birmingham-based property consultants Curry & Partners, who believe that current low interest rates, the threat of next year?s reduction in pension borrowing limits, and the influx of pensiondriven buy-to-let commercial landlords, is leaving market prices overly inflated.
Ian McPhillips, the firm?s commercial property partner, said: ?The crunch will come in April, when residential property can be incorporated into a self-invested personal pension scheme for the first time.
?In many instances, those that have invested in commercial property to bolster their pensions will now be turning their eye back to the residential market.
?Coupled with an influx of novice landlords, this will drive prices up for domestic property, leaving a decrease in demand for commercial buildings and an overall price weakening in this sector.
?My advice to commercial landlords is either to take advantage of the buoyant market and consider a sale now, or plan your portfolio carefully with commercial and residential investments that will reap profit over the long term.?
For those people who will have the choice of buying into the commercial or residential markets in April, Mr McPhillips believes that both sectors offer potential. ?If my predictions are correct, there will be some outstanding opportunities available in commercial property next year,? he said.