The latest report from the UK's largest property lending survey
from De Montfort University, Leicester, indicates the UK's
commercial property sector is paying back its debts from the
previous 'boom' years at a slow but steady pace.

Loans held against commercial property across the United Kingdom
fell by 4.3 per cent in the first six months of 2012, to a figure
of £204.1bn.

However, the report suggested the total value of outstanding
debt secured by commercial property in the UK was £285bn after
researchers took into account for Ireland's bad bank, securitised
loans and additional debt identified in organisations that didn't
take part in the survey.

The debt decline was also supported by a £12bn reduction in
outstanding value of high loan-to-value legacy debt from the 'boom'
years.

Arguably the most encouraging statistic to come out from the
report was an additional £11.3bn in new lending, encouraging
further development and prosperity in prime areas of London and across the South East.

Bill Maxted, author of De Montfort University's property lending
survey, said: "The loan books are slowly rebalancing as lenders
reduce the value of outstanding high loan-to-value legacy debt and
increase the volume of loans with lower loan-to-value ratios more
akin to those available in the market mid-year 2012."

Liz Peace, chief executive of the British Property Federation,
is equally encouraged by the latest report which indicates a
renewed level of faith in the market.

"The slow unwinding of loan books continues and it's encouraging
that positive action is being taken by lenders to erode the amount
of high-risk legacy debt," she said.

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