The real estate sector continues to face many challenges on the
road to recovery despite insolvencies decreasing in the last
Analysis by PwC shows a total of 139 UK real estate insolvencies
recorded in the third quarter of 2012. This represents a decrease
on the previous quarter, when there were 174 insolvencies.
When compared to the same quarter in 2011, the figures show an
increase of six per cent.
Mark Batten, real estate restructuring partner at PwC, said:
"There has been no material improvement in underlying economic
conditions or the availability of debt finance, as a result of
which conditions continue to remain challenging for the real estate
sector as a whole and are likely to remain so.
"Against this backdrop the decrease in insolvencies this
quarter is welcome, although I do not think is indicative of any
longer term trend."
The warning that insolvencies are likely to rise in the real
estate sector over the coming months suggests that companies
exposed to the sector should take precautions. Companies should
take a proactive approach to risk management and regularly review
the credit status of businesses in their supply chain.
Using one of Graydon's credit risk monitoring services allows
you to keep an eye on customers, suppliers and competitors for any
changes that may impact on your business.
The real estate sector was one of the worst hit industries
during the recession. It suffered as people and businesses became
less inclined to move and development projects could not be sold
Research by R3 found that between 2008 and 2009 there were more
than 12,000 insolvencies in the sector. This was almost double the
number of insolvencies of the second most affected sector,
The warning that insolvencies could increase in the sector
serves as a reminder that despite the recession being officially
over the effects will be felt for some time to come.