It is widely agreed that the number of properties coming to market for rent is reducing and this in turn is enabling landlords to increase rents.
Increases in rents, have been just a distant memory for most of the UK landlords but this reduction in supply will naturally lead to increases in rent. These will not only have the effect of cheering many of the sober faces around the tables of small landlord association meetings and those who manage commercial property portfolios; it will also increase rental yields. So rental yields have increased because of the reductions in property values and are now set to increase as rents improve to meet the reduced supply of rental property to market.
This could explain some of the activity by large property companies and investment funds who are rumoured to be circling commercial properties as a safer and potentially more profitable home for their funds. Will we look back at 2009 as the bottom of the commercial property price cycle? Recent times have shown no one can predict the future, and some will look back at 2009 with regret, will it be those who chose not to expand their portfolios?