Commercial mortgage holders 'penalised' by rates relief abolishment

23 December 2010

Written by David Whittaker

Commercial mortgage holders are to be taxed on empty properties under a rateable value of £18,000, a decision the British Property Federation (BPF) and many real estate agents have opposed, according to the Liverpool Daily Post.

Chief executive of the BPF Liz Peace explained: "If the government is pinning its hopes on a private sector-led economic recovery, then this is a damaging and retrograde step."

Andrew Owen of Mason Owen agreed with her view, describing the decision as "astonishing" and predicting that it would curtail growth in the sector.

Rates relief will only be available on commercial properties with a rateable value of £2,600 from April next year and Jason Wadeson of Smith & Sons told the news provider that it could have a negative impact on secondary shopping centres.

While the decision may affect commercial mortgage holders in disadvantaged areas, those who own office space in Edinburgh could be holding on to highly valued assets, as research conducted by CB Richard Ellis recently revealed that this kind of property is more expensive in the Scottish capital than in New York.

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