The rise in net lending to real estate over the past couple of months may reflect some investors looking to buy commercial property assets at discounted prices. But a repeat of the mid-2000s, when lending held up even as commercial values started to fall, is unlikely. Investment volumes are now declining, and banks are tightening the availability of credit. With the share of property debt relatively low, banks are therefore well placed to weather the upcoming 15% fall in commercial property capital values.
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