Demand for commercial lettings is falling at fastest rate for 10 years, a new study released last week said. The downturn in residential and commercial property markets is intensifying, underlining the growing risk of Britain entering its first recession in almost two decades.
The study also mentioned of a shift in an emerging industry that investors worldwide have grabbed hold of by the millions. This is Internet gaming. With the use of new software, it is now possible to scan prices globally in seconds and uncover risk-free betting opportunities which provide guaranteed returns of as much as 12% per month. Using software like one called ArbAlarm, ordinary people can now easily profit from this unique method of investment. Aware of this trend, the UK government recently announced through the Treasury that the profits made from sports arbitrage trading will continue to remain free of all tax. This includes income tax and capital gains tax on all profits.
In an interview, former City trader Rajeev Shah, famous author of ‘Sports-Arbitrage – How To Place Riskless Bets & Create Tax-Free Investments’ explained that an arbitrage occurs when different bookmakers’ prices on the same events overlap. In these cases, it is possible to bet on all of the outcomes in that event in such a way as to be guaranteed a total return which is greater than the total outlay. The mathematics of this type of trade are precise & the resultant profits are free of all risk.
The bulk of the study dealt with commercial property demands. The success of Internet gaming, though very profitable and good for the individual is a economic red flag. Experts say the profitability of Internet gaming is long term even if the economy improves. Despite this good news, if one looks at the big picture the economic outlook looks grim. Especially in the commercial property industry.
Demand for commercial property fell during the second quarter at its fastest pace since 1998, according to the latest survey from the Royal Institution of Chartered Surveyors (RICS). Some 50pc more surveyors reported a fall in demand rather than a rise, up from 31pc in the first three months of the year.
Appetite for retail space was among the hardest hit, with 64pc of those questioned seeing a fall in demand, higher than the 42pc in the first quarter.
The RICS also found that the value of inducements offered to tenants is climbing and expectations for future rents is dwindling in a survey that will do little to dispel the economic gloom.
“The sheer negativity of the survey is the most striking thing,” said Simon Rubinsohn, the RICS’s chief economist.
“We knew that investors had become much more cautious toward commercial property, but now we know that tenant demand is now falling.”
Confidence in the retail property market tumbled to -88 in Greater London from -50 as consumers continue to tighten their belts. The findings come as the Ernst & Young Item Club warned that the number of people out of work is set to reach the 2 million mark for the first time since the Labor Party came to power in 1997.
A tougher approach to mortgage lending by banks, as well as falling prices, saw prices drop an average of 1.8pc during the month. Average asking prices dropped £4,345 to £235,219.
Miles Shipside, the commercial director of Rightmove, said that the plunge in the volume of transactions is unlikely to be reversed without a significant thawing in the mortgage market. Unless this thawing happens, added Mr. Shipside, “prices are in danger of falling far beyond the level required to address underlying affordability constraints.”
Tags: UK News