Price War In The Works?

Source : TODAY, Friday, February 13, 2009

CDL offers Valentine’s Day discount for Pasir Ris project

AT A time when consumers think twice before forking out money for big-ticket items, a major property developer here is dangling outright discounts to lure buyers. And if customers do bite, the move may mark the start of a price war, say industry observers.





















Yesterday, Mainboard-listed City Developments Limited (CDL) fired the first salvo by revealing a 5-per-cent discount for selected units at Livia, a mass-market condominium in Pasir Ris.

The announcement was decibels louder than usual: Up until now, developers have largely offered discounts to walk-in customers, rather than publicly trumpeting the promotions. CDL is expected to be taking out advertisements for its special offer over the next few days.

The occasion for the promotion? Valentine’s Day tomorrow, according to CDL’s press release obtained by Today.

Cupid, however, is not going to be the clincher for customers, said Colliers International’s research and consultancy director Tay Huey Ying. It’s the “pretty attractive pricing”, she said.

Livia’s special price is about $620 per square foot (psf), said CDL, versus the average of $650psf during the phase-one launch in July last year when 340 of the 360 units released were sold. This equates to a discount of 5 per cent.

CDL “senses a renewal of market interest and improvement in buyer sentiment”, said group general manager Chia Ngiang Hong.

Although CDL said it would apply the offer to just 30 units of the 99-year leasehold project, the reality is likely to see some 60 units let go at that price, a marketing agent said, on condition of anonymity.

That is a small number compared to the 384 units still unsold. But observers say the V-Day offer may be a starting point, to test if the price is “right”. Said an industry insider: “People have been coming to showflats and just nibbling. Singaporeans want to see prices move.”

A three-bedroom unit at Livia will now cost $752,000, CDL said, versus the phase-one price of $793,000.

How long will the special offer last?

“A limited period,” CDL said.

Could this spark a price war? CDL’s competitors declined comment yesterday.

Colliers’ Ms Tay said developers were likely to resort to cutting prices — and hence eroding their profit margins — “only for projects that they’re keen to move in order to ease cash flow”.

It’s more likely that developers will roll out “a combination of competitive pricing and innovative marketing strategies”, said Ms Tay.

Demand, however, is certainly there. Crowds yesterday thronged Alexis, a freehold condominium near Queenstown MRT station, during the first day of its launch. By evening, more than half of the 293-unit project was sold, developer EC Prime told Today.

Agents there dangled a big sweetener: Discounts of as high as 28 per cent, resulting in prices between $850 and $1,150psf.

While there were interested owner-occupiers, some people were overheard asking: “What are my chances of flipping this?”

Last week, Frasers Centrepoint sold 300 units of the 712-unit Caspian project in Jurong West within the first three days for an average of $580 psf. Most of the buyers were Singaporean HDB upgraders.

CDL Cuts Prices Of Livia Units By About 5%

Source : The Straits Times, Feb 13, 2009

CITY Developments (CDL) plans to launch 30 units of its 724-unit Livia condominium project in Pasir Ris at an average of $620 per sq ft, about 5 per cent or $30 psf below the initial launch price last July.

CDL is selling 30 Livia units at an average of $620 psf, around $30 psf less than the initial launch price last July. -- PHOTO: CDL

The sale of the 30 three- to four-bedroom units starts tomorrow. Another 30 apartments may be released at the same price later.

The new pricing, announced yesterday, puts the price range of a three-bedroom unit at the 99-year leasehold condo from $752,000 to about $800,000.

This compares with last year's price of $793,000 and up for a three-bedder.

The developer will not be compensating earlier buyers for the price difference, given that the market has taken a big turn for the worse.

'This adjustment in the long run will be better for everybody,' said a CDL spokesman. The area's values will rise in future as new developments are completed, he said.

CDL's group general manager, Mr Chia Ngiang Hong, said the company had held back from selling new phases of Livia because of poor market conditions in the light of economic uncertainty.

The change of mind is due to revived interest being expressed by visitors to the development's showflat, he said.

'The company senses a renewal of market interest and improvement in buyer sentiment. More people have been visiting our showrooms, and many have made offers for units that have yet to be launched,' said Mr Chia.

The re-pricing of Livia units comes swiftly after the preview success of mass-market condo Caspian in Jurong West. Frasers Centrepoint has already sold 350 units of its 712-unit condo since last Thursday. The project was initially priced at $580 psf on average.

Livia met with a favourable response when it was released in July last year, with buyers scooping up 160 units of the first 200 apartments released in just a few days. CDL has so far released 360 units and sold 340, leaving 384 units available for sale.

Four MRT Lines In Marina Bay By 2018

Source : The Straits Times, Feb 13, 2009

BY 2018, the Marina Bay area will be served by four MRT lines - the North-South Line, Circle Line, Downtown Line and the Thomson Line.

Commuters will be able to reach an MRT station within a walking distance of no more than 400m on average.

Transport Minister Raymond Lim revealed this in response to MP and deputy chair of Government Parliamentary Committee for Transport Ong Kian Min's question on what was being done to make transport seamless in the Marina Bay area which will house the integrated resort.

Mr Lim said that the ministry was also working on making access to MRT stations in the new downtown seamless, with walkways underground, at street level and above ground.

Some could also be malls, like the link between Suntec City and City Hall MRT station.

Five Stations On Circle Line To Open In May

Source : The Straits Times, Feb 13, 2009

Transport improvements with new lines and more trains to save travel time

RESIDENTS in areas such as Lorong Chuan and Bartley Road will have an MRT station at their doorsteps a tad earlier than expected.

Circle Line Stage 3, which has five stations, will open on May 30 instead of June, Transport Minister Raymond Lim announced in Parliament during yesterday's debate on his ministry's budget.

What commuters can expect

The remaining 24 stations on the new line will open progressively from next year, helping to reduce crowding on the existing MRT lines.

When completed, the Circle Line will take about 10 to 15 per cent of commuter trips from existing lines.

'(It) will help commuters save travel time, by reducing the need to make detours into the city centre to transfer across MRT lines,' said Mr Lim.

The five stations that will open are Marymount, Bishan, Lorong Chuan, Serangoon and Bartley.

Bishan will be the interchange station for the North-South line and Serangoon, the North-East line.

Student Jerald Seow, 15, who lives near Bartley Road, was among those who jumped with joy yesterday on hearing the earlier opening date.

He now takes a 25-minute bus ride to Paya Lebar MRT station and hops on a train to get to town on weekends.

'When Bartley station opens, I can take a train to Bishan MRT instead. It will be a lot more convenient,' he said.

The Circle Line is among $40 billion worth of rail projects that will double Singapore's rail network.

Besides adding new rail lines, the Transport Ministry is also intent on reducing waiting time along existing lines, which introduced 900 extra train trips a week last year.

One major move is the purchase of 22 new trains, to be delivered in 2011.

Another is to expand Jurong East MRT station, where there is a bottleneck.

Trains arriving there from Bukit Batok now have only one platform and track to stop at before they turn around. A second train will have to wait for the first to leave before it pulls into Jurong East.

A project to add another platform and track will be completed by 2011 instead of 2012, said Mr Lim.

The changes to Jurong East station and the new trains will cost $800 million in all. They will help boost carrying capacity along the North-South and East-West lines by 15 per cent and slash the waiting time between trains to two minutes in 2011 from the current 2.1 to 4 minutes.

It is not possible to go lower than two minutes, the ministry said, as the signalling system on the North-South and East-West lines cannot support a shorter time between trains.

Yet another project that will come onstream earlier is the extension of the North-South MRT line to Marina South. It will be completed a year earlier, in 2014.

Meanwhile, trains are likely to be more crowded as public transport ridership grows, before relief arrives in 2011.

Overcrowding on trains was raised by Madam Cynthia Phua (Aljunied GRC).

Responding, Mr Lim said the crowding level is still below what is acceptable.

At their most crowded, trains here carry an average of 1,300 to 1,450 passengers, compared to the Land Transport Authority's standard of 1,600 passengers.

They are also less crowded than trains in other cities. Singapore's trains pack in four people per square metre, which is similar to those in Hong Kong but lower than London's (five people) , Tokyo's (seven) and Shanghai's (eight).

Parliament sitting continues today, the last day of the nine-day Budget debate.

Alexis At Alexandra Pulls In The Punters

Source : The Business Times, February 13, 2009

PREVIEW sales of the 293-unit Alexis at Alexandra Road started yesterday and developer Fission Group said that at least 50 per cent of the development has been sold at prices ranging from $850 per square foot (psf) to $1,100 psf.

Keen interest: A seasoned property consultant said that interest in Alexis is likely because most of the units are small and prices range from $450,000 to $650,000

The company was coy on the exact number of units sold but it may have been a tad too modest. Some buyers BT spoke with at the crowded show flat said that they were told by marketing agents that up to 85 per cent of the units had been sold by 7.30 pm.

'The prices are competitive compared with other condominiums, but its proximity to the MRT and CBD makes the Alexis a good investment,' said Steven Kwok, a potential buyer who had been quoted a price of $1,050-$1,100 psf.

Another buyer said that compared to the recently launched Caspian ($580 psf), Alexis is not cheap but he hopes to resell the property for a profit. He also said that compared to what was quoted in an invitation he had received earlier, prices quoted at the showflat were 10 per cent higher.

According to official data, three units at The Anchorage next door sold at $848-$929 psf in the fourth quarter while a unit at Queens on Stirling Road sold for $894 psf this month.

Fission Group has tied up with United Overseas Bank to offer an interest absorption scheme, which, like the now-scrapped deferred payment scheme, allows buyers to defer any payments beyond an initial downpayment until the project receives Temporary Occupation Permit (TOP).

Alexis is being built on the former Alexandra Centre which was put up for collective sale in 2007 for around $300 per square per plot ratio. It is not known how much Fission Group paid for the site.

A seasoned property consultant said that interest in Alexis is likely because most of the units are small. At between 400 sq ft for a one-bedroom unit and 650 sq ft for a two-bedder, prices range from $450,000 to $650,000.

He also said that there was 'still liquidity in the market' and investors with a two-year investment horizon would still find property attractive. 'There is no point putting money in a bank,' he added.

Over on the east coast, City Developments Ltd (CDL) will launch a new phase for its Livia condominium in Pasir Ris at an average price of $620 psf, or about $30 psf less than the launch price of the first phase. A total of 30 units in two stacks will be offered in the second phase.

Chia Ngiang Hong, group general manager of CDL said: 'The company senses a renewal of market interest and improvement in buyer sentiment. More people have been visiting our showrooms, and many have made offers for units that have yet to be launched.'

Alexis 改小推出反应热烈 公寓打折预售首日卖出85％

Source : 《联合晚报》February 13, 2009

眼见房地产市场不佳，发展商半年前决定将Alexis@Alexandra私人公寓项目85％的单位改小出售，在昨天的预购推出首日取得热烈回响，截至今午已售出80％，甚至出现投标抢单位的情况！

拥有293个单位的永久地契项目的发展商Fission Group在接受本报询问时透露，截至今午已有80％被售出，售价在每平方英尺850元到1100元之间。

市场人士认为，Alexis多数单位较小，售价介于45万到65万元是掀起抢购热潮的原因。（《商业时报》照片）

发展商说，在观察了目前的市场情况，他们决定将原本计划较大的公寓单位改小，85％以1卧房式和2卧房式单位售出，为的是让更多投资者及有意购买公寓的年轻夫妇能够负担得起。

这个项目的多数单位，面积都偏小，介于400平方尺（一卧房）到650平方尺（二卧房）之间，售价介于45万到65万元。

几名房屋经纪今早受询时说，昨天的预购会出现的人潮就快将示范单位“挤爆”，而且有些单位还出现现场投标情况。

“得标的人就好像‘中马票”一样，不但露出喜悦的表情，有些还兴奋地跳了起来！”

除了靠近地铁站，发展商还同大华银行推出免付利息计划，吸引更多人购买。

在计划下，购屋者可以在支付头期款后，延迟其他的付款直到项目取得临时入伙准证（TOP）。

有人一口气买数单位

折扣高达28％，有人一口气买下几个单位！

一名不愿透露姓名的购屋者说：“这里地点方便，靠近乌节路和地铁站，价钱也很公道，所以决定买几间来投资，留一间自己收就好。”

另一名有意购屋的郭先生说：“这个公寓的价格和其他周边的公寓价格‘有得拼’，再加上靠近地铁站和中央商业区，这是一个好的投资项目。”

但也有人因为人太多而打消购买念头。一名受访者说，他认为场面太混乱，等到稍微平静后，真的有剩余单位，若他真的喜欢才会买。 据了解，28％折扣只限昨天。

根据官方数据，去年第4季，位于“隔壁”的Anchorage，售价就在每平方英尺848到929元，而Queens@Stirling Road的一个单位要价也要每平方英尺894元。

DC Rates May Be Cut In Unforgiving Market

Source : The Business Times, February 12, 2009

One hot discussion topic is whether govt will revert to 50% formula for DC calculation in face of recession

Property consultants expect the government to make bigger cuts of up to 20 per cent in development charges (DC) for the upcoming revision effective March 1. And some observers say the authorities may even lower the proportion of the enhancement in land value that goes to the state.



















The bigger cuts in DC, which is payable for enhancing the use of some sites, may come despite a dearth of land transactions.

This is because there is sufficient evidence that prices and rentals have fallen for condos, offices and industrial properties - a trend that points to lower land values.

Explaining the residual land valuation method, Knight Frank managing director Tan Tiong Cheng says: "Condo prices have come down; that can be measured quite accurately. On the other hand, construction costs have eased at a more modest rate. This implies land values have fallen more than sale prices of apartments."

Property analysts say another challenge ahead for Chief Valuer would be to make an accurate assessment of property market conditions for the next six months for which the upcoming DC rates would remain applicable.

Development charges must be paid for enhancing the use of some sites or building bigger projects on them. DC rates are revised twice yearly, on March 1 and Sept 1, by the Ministry of National Development (MND), in consultation with the Chief Valuer. They are specified according to use groups (such as landed residential, non-landed residential and commercial) across 118 geographical sectors or locations across Singapore. DTZ senior director (research) Chua Chor Hoon said: "We expect average DC rates for all major use groups to decline come March 1. Commercial and non-landed residential DC rates are likely to fall more, as prices and rents of these two major categories of properties have fallen more than the rest."

Jones Lang LaSalle's associate director (research and consultancy) Desmond Sim predicts average DC rate cuts of about 20 per cent for landed and non-landed residential uses as well as for commercial use, and a 5 to 10 per cent reduction for industrial use. "For non-landed residential use, more downward pressure can be expected for high-end locations," he added

Colliers International forecasts average chops of 15 to 20 per cent for non-landed residential use, 10-12 per cent for commercial, 5-8 per cent for industrial, and up to 5 per cent for landed residential and hotel uses. Forecasts by both houses assume there is no reinstatement of DC formula to 50 per cent of enhancement in land value.

Colliers says the biggest drops in non-landed residential DC rates of up to 25 per cent will be in luxury residential enclaves such as Ardmore Park, Orchard, Cairnhill, Tanglin and Cuscaden as well as on Sentosa Cove due to a steeper fall in values of luxury homes. Colliers director (research and consultancy) Tay Huey Ying suggests the biggest chops in commercial DC rates could be in outlying locations rather than in the CBD, arguing that spillover office demand to outside- CBD areas has cooled considerably lately, due to ample new supply of offices in the CBD.

For industrial DC rates, Ms Tay reckons the largest cuts of up to 12 per cent may be seen in places like Jurong Industrial Estate, Mandai, Kranji and Woodlands based on the fact that some of these locations saw the biggest downward adjustments of about 10 per cent in JTC Corp's land prices recently.

A hot topic of discussion surrounding DC is whether the government will revert to the previous formula of calculating DC rates which creamed off 50 per cent of the enhancement in land value (instead of 70 per cent, since a rule change in July 2007 during the property bull run). Many consultants are making the case for reinstating the previous 50 per cent formula, though some are not holding their breaths for a change just yet.

"If they make a change now, it may be seen as a knee-jerk reaction. The change could eventually still come, but perhaps one or two revisions later," said Jones Lang LaSalle's Mr Sim.

Colliers' Ms Tay argues for an immediate restoration of the 50 per cent formula. She said that prior to 1985, DC rates had also been on the 70 per cent formula until they were cut to 50 per cent during the recession that year. She said: "If in 1985, they deemed it fit to cut the DC rate to 50 per cent because of the recession, they should do the same now because we're going through our worst recession.

"In any case, sharing the appreciation in land value equally between government and private land owner is a fairer policy since the latter must be given sufficient incentive to bear the risk of development to encourage him to optimise scarce land resources."

During the last DC rate revision effective Sept 1, 2008, MND left DC rates largely unchanged, except for an average 6.3 per cent cut for non-landed residential use.

At the time, property consultants said there may not be sufficient evidence yet of declines in property values, and that rates could be cut at the next revision if stronger evidence emerges of falling values.

The last revision also saw MND change boundaries for eight geographical sectors in three precincts - the Race Course Road area, Jurong Lakeside area and Pulau Brani.

5 New Stations Open In May

Source : The Straits Times, Feb 12, 2009

FIVE stations on the new Circle Line will open to the public on May 30, which is slightly earlier than expected.

The five stations are Marymount, Bishan, Lorong Chuan, Serangoon and Bartley. The stations were originally planned to open in June. -- ST PHOTO: JOYCE FANG

This was announced by Transport Minister Raymond Lim in Parliament on Thursday.

The five stations are Marymount, Bishan, Lorong Chuan, Serangoon and Bartley. The stations were originally planned to open in June.

Bishan and Serangoon stations are interchange stations. Commuters can transfer to the north-south line at Bishan and change to the north-east line at Serangoon.

The rest of the Circle Line, which has 29 stations in all, will start operations progressively from 2010. When it is fully up and running, it will help reduce 10 to 15 per cent of the commuter trips currently made on existing lines.

Besides the Circle Line, the Transport Ministry has also brought forward the opening dates of two other rail projects. The north-south line extension to Marina South will open in 2014 instead of 2015, while a plan to add an extra platform and track to Jurong East MRT will be completed in 2011 instead of 2012.

The changes to Jurong East will help ease a bottleneck at the station, where trains from Bukit Batok terminate at before turning around. As there is only one track and one platform for these trains, a second train would have to wait before pulling into Jurong East.

With an extra platform and track, train headways along the busiest stretches of the north-south line will drop to about two minutes from the current two to three minutes. This will lead to a 15 per cent increase in capacity.

Besides changes to infrastructure, the ministry will also purchase 22 new trains, which are needed to cut waiting times.

Property Transactions With Contract Dates Between Jan 1st - Feb 6th, 2009

Take-Up Of JTC Industrial Space Falls 33% In Q4

Source : The Business Times, February 12, 2009

But termination of ready-built factory space surprises with 30% fall

NET take-up of industrial space fell again in Q4 2008 for industrial landlord JTC Corporation, as the downturn continued to weigh on businesses.

JTC's 2008 facilities report released yesterday shows the agency leased or rented out 20,000 sq metres of ready-built factory space in Q4 - a 33 per cent slide from Q3. Affected locations included flatted factories, business parks and standard factories.

Some observers expected companies to return more space to JTC as the economy weakened, but this did not happen in Q4. In fact, termination of ready-built factory space dropped 30 per cent from Q3 to 21,200 sq m.

Most of the terminations - 48 per cent - were because businesses consolidated their operations. The manufacturing sector, which includes electronics and precision engineering, accounted for more than half of the pull-back.

JTC said the termination size was larger in Q3 because more companies moved out of space scheduled for 'product renewal' - this is when JTC systematically retires ageing facilities to redevelop sites.

As DTZ's senior director for research Chua Chor Hoon also suggested, some companies could have sub-let excess space instead of pulling out altogether in Q4. This helps them avoid relocation costs.

After accounting for terminations, JTC's net allocation of ready-built factory space in Q4 was minus-1,200 sq m, swinging further into negative territory from minus -500 sq m in Q3.

Despite the weak Q4 showing, ready-built factory space enjoyed a decent net take-up rate for the whole of 2008 - net allocation was 90,700 sq m, up from 88,700 sq m in 2007.

Much of the improvement was due to JTC leasing or renting out more business park space, especially in the first phase of the Fusionopolis development.

The occupancy rate for ready-built factory space also rose in 2008 - to a 10-year high of 96.8 per cent.

Take-up of JTC's prepared industrial land fell in Q4. Across areas such as Jurong Island and Tuas Biomedical Park, which come complete with infrastructure for lessees to develop their facilities, net allocation was 17.5 hectares - 49 per cent down from Q3.

Terminations fell more than 70 per cent to 6.1 ha in Q4. Industries supporting the manufacturing sector accounted for most of the pull-back.

For 2008, net allocation of prepared industrial land was 200.9 ha. This was 41 per cent less than the 10-year high of 341.2 ha in 2007.

JTC said 2008's 'sustained performance was against the backdrop of global economic uncertainties and a very challenging environment towards the latter part of the year'.

The manufacturing sector took up a much smaller proportion of prepared industrial land last year - 40 per cent of the gross allocation of 264.8 ha went to the sector, compared with 74 per cent in 2007.

Weakness in the industrial property sector has emerged in the past few months. Data from the Urban Redevelopment Authority in January reflected lower rents and prices in Q4 2008 after more than four years of steady increases.

Global Property Investment Expected To Slide Further

Source : The Business Times, February 12, 2009

(EDINBURGH) Global real estate spending on office buildings, stores and apartments may fall another 5.3 per cent this year to US$412 billion as lenders keep a tight rein on credit, property broker Cushman & Wakefield Inc said.

Lack of credit pushed commercial property acquisitions down 59 per cent to US$435 billion last year, the lowest since 2004, New York-based Cushman said.

'Although virtually all global markets had a decline in investment, it's been the mature markets which have suffered most,' David Hutchings, Cushman's London-based head of research for Europe, the Middle East and Africa, said in a statement yesterday. 'Emerging markets now account for 22 per cent of global investment when as recently as 2006 they only accounted for 9 per cent.'

Banks have been reluctant to lend or refinance real estate loans as they try to conserve cash after losses and write-downs totalling US$1.1 trillion. Recessions in the US and some European countries have crimped demand for office and retail space, causing values to drop because landlords cannot command as much in rent.

Commercial property values have fallen most in Europe, where yields rose 111 basis points, compared with an average 31 basis point increase in North America, Cushman said. The yield on property moves inversely to prices. One basis point is 0.01 percentage point.

'Pricing in many countries at the market peak was aggressive and became divorced from the reality of underlying growth and income,' Mr Hutchings said. 'Pricing may now be becoming too conservative in some markets.' - Bloomberg

Shaftesbury Warns Of Rising Office Vacancies In London

Source : The Business Times, February 12, 2009

(LONDON) UK property firm Shaftesbury said yesterday that shops and restaurants in its London portfolio continue to trade well despite the economic downturn, but warned of rising vacancies and falling rents in its offices.

No downturn here: Shaftesbury, which owns about 470 properties in London's West End, said demand from tenants for shops and restaurants remained healthy

'The general economic environment remains challenging and we expect to see an increase in vacancies in the coming months,' Shaftesbury said in an interim statement, adding it believed its West End properties would continue to be in demand.

Shaftesbury's stock price was up 0.7 per cent at 298 pence yesterday morning, while the London market's property stocks sector index was down 1.1 per cent. The FTSE 100 index was up 0.2 per cent.

The company, which owns about 470 properties in London's West End district, said demand from prospective tenants for shops and restaurants remained healthy and it had not seen any fall in the rental values of such spaces.

'This year, the weakness of sterling is bringing more visitors from the euro zone and should also increase the volume of domestic visitors to the West End, as travel to overseas destinations has become relatively more expensive,' it said.

Shaftesbury, which also owns 400,000 square feet of offices and 280 apartments in the upper floors of its properties, said office rentals were now declining, while office vacancies have quadrupled to 36,000 sq ft since the end of September 2008.

As at end-Jan Shaftesbury had a total 67,500 sq ft of vacant shops, restaurants and office space, down from 71,000 sq ft at end-September 2008.

The estimated rental value for the vacant commercial space - including properties under offer and those being refurbished - fell to around £pounds;2.5 million (S$5.52 million) at end-January, from £pounds;3.3 million from four months ago, it said.

Shaftesbury said its bank borrowings at the end of January stood at £pounds;473 million, against committed facilities of £pounds;600 million, while its overall cost of borrowings fell to 5.1 per cent from 6.1 per cent at end-September 2008. -- Reuters

UK Commercial Property Values Fall

Source : The Business Times, February 12, 2009

(LONDON) UK commercial property prices fell 3.5 per cent in January, continuing their decline after the market fell 26.8 per cent in 2008, the world's biggest property broker CB Richard Ellis (CBRE) said on Tuesday.

While January's fall in value was not as sharp as the 4.9 per cent drop in December, the decline in rents accelerated slightly to minus 0.9 per cent, according to the CB Richard Ellis Monthly Index.

'January's results were marked by an easing of the negative impact of higher yields, but a pick-up in the rate of rental falls,' said Peter Damesick, head of UK research at CBRE. 'This combination is likely to carry on, with rents continuing their downward movement in the coming months.'

CBRE, one of the biggest contributors of data to benchmark index compiler Investment Property Databank, said property values are now 37.8 per cent below their peak in mid-2007.

Total returns, which comprise rental returns and capital growth, were minus 2.8 per cent in January, and minus 31.6 per cent from their mid-2007 peak, CBRE said. -- Reuters