The commercial real estate industry in the United Kingdom is receiving much buzz in recent years. There are several factors that contribute to the real estate boom in the U.K. The high rate of immigration to the country, specifically from Asia, Africa and other countries of the European Union, has called on numerous individuals and companies to invest in business undertakings in the U.K. Aside from this, the U.K. is also one of the top ten tourist destinations in the world, with Heathrow Airport being the busiest airport worldwide. All these have called the attention of various local and international businesses to invest in commercial real estate in the U.K.

Local investors are not the only ones getting attracted to the commercial real estate market in the United Kingdom. A lot of foreign investors, specifically from the United States, are spending their hard-earned money in order to purchase a significant amount of commercial property in the United Kingdom. One of the reasons for the large number of foreign investors is the high returns of investments that commercial properties in the U.K. are able to generate. In general, there is a higher return of investment that one can receive from property investments than from government or corporate shares.

In the aftermath of the recent Northern Rock crisis many property experts are now warning of the risk of a 1990′s style property crash in the future, although they put the chances of this actually occurring at 10 percent. Whereas these same experts had previously predicted continued increases in property prices, this change of tact in property price predictions is due not only to the events at Northern Rock, but also due to what has happened recently in the sub-prime lending market in the

United States, as well as the seemingly endless increases seen in UK property prices.

However, Simon Rubinsohn, chief economist at the Royal Institution of Chartered surveyors told Reuters that while talk of a “crash” was legitimate and not irresponsible, homeowners were unlikely to see a repeat of the previous slump. Rubinsohn had previously predicted further increases in prices over the next 12 to 15 months, estimating growth of around 3 percent. Now, however, he is forecasting a flattening of prices across the same time period.

The huge increase in property prices seen throughout the UK over the past few years has made its share of the headlines – highlighting the need for more housing in the country. Property news and price forecasts have driven people towards making decisions regarding buying and selling their homes and investment properties and we are likely to see this new prediction change the property market yet again.

The number of people buying property to rent has already been subject to increase and these numbers are only likely to climb even higher in response to the latest news regarding the fall of property prices. Rubinsohn predicts London property will have the greatest likelihood of experiencing a drop in prices, claiming that were was a 20 percent chance of a decline in property prices in the City – possibly as much as 10 percent. As a result, many homeowners who have recently sold their properties are now hedging their bets on further price reductions, while in the meantime renting properties as they wait to purchase property at an even lower rate.

Renting accommodation allows these people who have recently sold their property to sample life in a new area, town or city. Furthermore, many people who have recently sold their property have been placing their profits into savings accounts in order to take advantage of high rates of interest currently on offer through banks – often generating a sizeable income while waiting for the perfect opportunity to reinvest in the property market.

If the drop in prices of property for sale in London and across the country does occur, it will also give hope to many people who have previously been out of reach of the property ladder as prices and deposits will be lower than before.