Distressed property sales to increase

LONDON: More distressed property sales are expected in the next 12 months as changes to international regulations will likely raise the capital cost of holding commercial property on banks' balance sheets, an industry body said.

Growth in distressed property listings eased in the second quarter of this year, but are expected to worsen in the third, the UK Royal Institution of Chartered Surveyors (RICS) said yesterday, based on the results of a survey of its members.

RICS defines distressed properties as those with foreclosure orders or which are advertised for sale by their mortgagee, and which tend to fetch lower prices than their market value.

Three European countries - Portugal, Spain and Germany - were worse off in the second quarter, reporting distress in their market had risen at a faster pace.

By Reuters