Reits ''need to be more flexible''

More flexibility is needed in real estate investment trust (Reit) legislation so that the UK has a tax-efficient onshore property vehicle just like the US and Australia, according to one property expert.

At the beginning of January companies worth a total of £50 billion converted to Reit status but Dave Butler from Reita, which supports the introduction of Reits, says that more flexibility is needed in areas such as AIM listing so that the market can fully grow.

He said the government has been flexible to date but that it needs to further relax Reit laws to give offshore companies an incentive to come onshore.

Mr Butler said an incentive like doing "away with the conversion charge for a period of time" may work.

"The real test will be whether new vehicles which are investing in property are launched onshore or offshore," he added.

Reita also recommends that though property should be an important part of any investor''s portfolio, one should not expect to see stellar returns.


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