Retail sales show improvement - commercial mortgages

07 November 2006

Investors in retail property, including those with commercial mortgages, may have benefited from higher retail sales during October compared to the same period in 2005, a new report reveals.

According to a survey published by the British Retail Consortium, sales within the retail sector rose by 2.6 per cent last month, compared to the previous year when sales fell by 0.2 per cent.

However, according to Kevin Hawkins, director general of the BRC, sales growth did not improve dramatically during October, with furniture and home ware sales continuing to fall, the Guardian reports.

"Sales growth remains on the same restrained level as in previous months and must be set against the continued inflation in the retail industry's cost base, especially wages, property and energy," he comments.

The firm suggests that despite the modest rise in sales, consumer confidence in the economy is expected to remain low.

A recent report into the market for investors in commercial property published by the Royal Institution of Chartered Surveyors found that demand for property continued to fall during the third quarter, although the "pace do decline" slowed.