UK Property Investment The WritePass Journal

UK Property Investment Executive Summary UK Property Investment , than they were in previous years. Furthermore, although there is still economic stagnation, certain industry sectors such as the services sector are now experiencing growth. The construction sector, however, is still seeing output falling and this may go some way to explaining the reason why the property industry is somewhat holding its own, showing stagnation, but not decline (Chegut, et al 2011). The commercial property industry operates in a slightly different way from the residential property investment industry. Therefore, for the purpose of this analysis, the overall property industry is looked at, with differentiations drawn between the commercial and residential property investment being made where appropriate (Pyhrr, et al 1999) Property investors, essentially, will make their money from either purchasing properties, renovating them in some way and then selling them on for a profit, or from purchasing an investment property and renting it to another on a weekly, monthly or annual return. More properties are finding themselves within the rental market and this is particularly common when it comes to commercial property, where a business may find it more advisable to rent a property so they will not have the initial capital outlay, or the risks associated with purchasing property, particularly the new start-up businesses. Businesses, in general, particularly those on the high street or smaller businesses looking to expand are nervous in the current economic climate and will therefore look towards mitigating their risks by renting property that they can release in the event that funds are not forthcoming. Approximately one half of foreclosure properties are rented, as opposed to one third of all residential pro perty, and when individuals find it hard to purchase property, the rental industry naturally booms. Trends have suggested that certain areas of prime property locations remain very much in demand, despite the economic conditions. For example, property in central London remains popular and buoyant for both residential and commercial purposes (Sing 2004). It is suggested that, overall, while the property market and, in particular, property prices have been relatively stagnant, over the years, there are still positive trends available for investors, with certain regions such as house prices in central London experiencing value growth, and rental income of commercial premises in popular areas also seeing periods of growth as organisations look towards reducing their costs by renting properties, rather than purchasing. Analysis of Industry By undertaking the PEST analysis looking at political, economic, social and technological issues in order to gain a greater understanding can be had of the ways in which the industry is operating. The PEST overview is contained in the appendix and is discussed here, in more detail, and an overview analysis is also provided. It can be seen that, despite the recent economic difficulty that has emerged, with many individuals being forced to sell property due to their inability to meet with mortgage demands, this has actually provided an opportunity for property investors (Lizieri, 2009). Many properties come to the market at below market prices and therefore make perfect targets for the investors. This also creates a broad range of individuals looking to rent properties, as they are unable to purchase. The more stringent lending conditions have therefore provided the property investment market with a growing target group of potential investors who are likely to be able to make the most of the trends in the property market, to ensure that their own investment business is buoyant (RICS. 1993). Opportunities for Graduates Drawing on the above analysis, it can be seen that there are multiple opportunities available to graduates looking to enter into property investment or, indeed, any other individual who may potentially be considering it as a real career option. Firstly, there are the opportunities available within the commercial property investment market, and in particular, looking toward facilitating the demand for the new small businesses which are emerging with government support and grants. As individuals become more likely to set up small businesses following unemployment, facilitating this by offering shared office space provides a good opportunity for new individuals entering the market. Secondly, there are opportunities within the residential property investment market, in terms of making the most of foreclosure properties by purchasing them at a low price and then selling them on, or renting them within the market (Harvey et al 2004). The real opportunities that exist for new graduates are in identifying where the growth areas are going to be both geographically and in terms of the types of properties, and then being able to claim the properties at below market prices. In order to achieve this, the individual will need to be astute and may be able to draw together a large amount of property data, in a relatively short space of time. Gap Analysis The key skills which will be vital for success within the property investment market include the ability to group together economically and to ascertain the likely ways in which prices are going to change, in this area, both geographically and in terms of the property types. This involves the ability to undertake strong economic analysis, including the use of simulation models, which will be a key skill that will enable young graduates to gain a competitive advantage, when entering the industry. Graduates also need to be able to analyse the surrounding sectors, as demand for commercial property, in particular, will reflect how other industries, are performing (Leone and Leger 2008). For example, if the retail industry is weak, then the demand for retail premises is also likely to reflect this. Using economic tools will enable a graduate, to identify potential growth areas and to ensure that they have property available, ahead of the competition. Conclusions The property investment market has generally been showing stagnation, in recent years; yet, the trends also indicate that certain areas of the property investment market are showing opportunities, with some of the negative factors driving the property market downwards, allowing property investors to benefit, such as by purchasing properties that are being sold by mortgage companies, following the failure to meet with lending requirements. Bearing this in mind, individuals looking to enter the property investment market need to have a particularly astute ability to analyse economic conditions; they will also need to understand the driving trends, rather than necessarily being merely knowledgeable in the area of property, in terms of bricks and mortar. References Acclimatise (2009) ‘Managing the unavoidable: Understanding the investment implications of adapting to climate change – UK commercial property’, Oxford: Acclimatise. Available at: www.acclimatise.uk.com/resources/reports British Property Federation (2011). IPD Annual Lease Review 2011 Chegut, A., Eichholtz, P., Kok, N. (2011). Supply, Demand, and the Value of Green Buildings. Working Paper, Maastricht Universiy, December 2011. Harvey A, Koopman S J and Shephard N (2004) State space and unobserved components models: theory and applications, Cambridge: Cambridge U P. Leone V and Leger L (2008) ‘Generating innovations in economic variables’, Applied Financial Economics Letters, 1-7. Lizieri, C. (2009) Towers of Capital: Office Markets and International Financial Services. 1st.ed.,Wiley-Blackwell, UK, pp. 344. Pyhrr, S.A., Roulac, S.E. and Born, W.L. (1999) Real Estate Cycles and Their Strategic Implications for Investors and Portfolio Managers in the Global Economy. Journal of Real Estate Research, Vol.18, No.1, pp.7–62. RICS (1993) Understanding the Property Cycle. Working Paper Two: A Literature Review. The Royal Institution of Chartered Surveyors, London, pp.47. Simpson M W, Ramchander S and Webb J R (2008) ‘The asymmetric response of equity REIT returns to inflation’, Journal of Real Estate Finance and Economics,34, 513-529. Sing T F (2004) ‘Common risk factors and risk premia in direct and securitized real estate markets’, Journal of Property Research, 21, 189-207. Appendix Political The government and political situation is definitely looking towards stimulating growth within the property market and, as such, is considering ways of making it easier for developers to establish new property, both residential and commercial. In particular, there is evidence of political movements towards ensuring that the lower end of the market is revitalised to encourage first-time buyers. This will have an impact on property investors focusing on rental opportunities, as the easier it becomes to purchase, the less likely they will be to obtain rental income. There are also political efforts being made to encourage new businesses and this can be seen to be a positive option for commercial property investors, as new businesses will be more inclined to rent property and this will be more cost-effective, initially, and will allow the opportunity to grow rapidly, if they so choose. Economic The economic availability of mortgages and the reduction in the ability of individuals to borrow money, in order to purchase property, either residential or commercial will have a direct bearing on the property investment market. Property investors will have a much more willing customer base, as they have been unable to obtain sufficient finance to purchase their own property and are therefore looking towards rental property as an alternative. The more difficult economic times have resulted in many residential and commercial owners losing their premises, as a result of their inability to pay their mortgages and this also offers the opportunity for property investors who have sufficient cash reserves to purchase property at below market prices (Acclimatise 2009). Social Social changes and, more specifically, changes within the employment market also tend to encourage individuals to go into businesses and become self-employed, which ultimately provides an opportunity for the commercial property investors who are able to purchase premises that may be suitable for the new small start businesses. There is also a changing demographic trend for more single-parent families that are smaller and the increase in independent living within the older generation, thus placing a greater demand on rental premises that are smaller and will reflect the changing demographic (RICS 1993). Technological Technological drivers provide both opportunities and progress within the property investment market. Whilst this allows property investors to have a much greater access to potential customers, it also means that their customers have much greater access to the competition. Therefore, there is a need for organisations offering property investment services, such as rental property, to utilise technology in order to capture the broadest possible audience. Technology has also shifted the way which organisations are operating this has resulted in many cases of individuals working from home, or working from shared spaces, thus reducing the demand for traditional commercial premises (Simpson et al 2008).

Individual Advancement vs Democracy essays

Individual Advancement vs Democracy essays "God helps them that help themselves" (Poor Richards Almanack, 722), a phrase commonly quoted from "Poor Richard's Almanacks", illustrates the types of selfishness often seen during Benjamin Franklin's time. Or does it? Is wanting and striving for a better self so bad? Would the reader of such phrase think to himself "Wow, the author is really self-absorbed" or "The author must be a hard worker who values self improvement"? Either way, the real question is why doesn't it say "..... those that help others" instead "..... them that help themselves". You are taught as a young child the importance of thinking of others first and group effort. It is continuously reinforced throughout all areas of your life, including school and work. Everyone knows that at some time or another in your life you won't be able to do everything by yourself. In other words, you'll need others and this is where the democratic community comes in. However during the 18th century, this was not the point. The freedom of self-government we had struggled so hard and long for had become no more than a night's dream erased by the morning sun. Democracy and self-advancement were in a race for the gold as Ralph Waldo Emerson and Nathaniel Hawthorne thought. Benjamin Franklin's ideas begged to differ. He felt as though the democratic community and growing the ideology of individual advancement (Individualism and/vs. Community, 1306) could coexist together. Franklin, having risen from poverty, felt that he wouldn't have been able to be a man of such distinction if it had not been for Government that encouraged the advancement of self. He felt that without a Government no one man could be content with themselves or their works. He even goes as far as to promote America to foreigners in one essay. He says that "Strangers are welcome, because there is room enough for them all, and therefore the old Inhabitants are not jealous of them; the Laws protect them ...

First World War Essay Example | Topics and Well Written Essays - 2500 words

First World War - Essay Example This is a reflection of the large numbers of deaths, which finally made the war unpopular on all sides. None of this means, however, that the war was unpopular in some countries to begin with. The European powers were still rivals for the spoils of Africa, and certainly Britain suffered from 'Jingoism' (A popular term for what is almost outward-directed xenophobia, extreme rivalry and bigotry aimed at Britain's economic rivals), and the majority of the other nations involved in the war did so too. Perhaps the only member of the Great War who was not a willing combatant is Russia, who entered into battle almost by accident, having become a third party in the Anglo-French Entente. Even there, however, public feeling was partially aroused by the 'neo Slav' movement "The Neo-Slavs envisaged truly independent Slavic nations in a free association"2. Other nations, such as America, also mobilised, but here the conditions of the popular movement are not always clear. While Woodrow Wilson's government swept into action: "People were ordered to 'work or fight'. Every adult male registered with a draft board"3. Although America joined the war too late to count as a subject for analysis here, the support which the war received when they finally joined provides an interesting parallel with the nations of Europe. In addition to the loss of life, the Great War had a number of consequences for all of the nations involved. Britain was obliged to grant women the vote after their war contribution; Russia collapsed into the Bolshevik Revolution, and then Communism; and Germany was damaged so severely that it also effectively disintegrated, and of course the mighty and powerful Austro-Hungarian Empire was finished. None of these consequences could have been foreseen at the beginning of the war. Britain The war in Europe came as no real surprise to anyone in Europe. For most of the first decade of the twentieth century, the continental powers were involved in a rapid series of peace talks and treaties. England and France became allies in 1905, with the Entente Cordial (Which became the Triple Entente when Russia joined). Forces such as the National Service League ensured that the general populace was prepared for war: " Unbelievably glib assertions that 'war is not murderwar is sacrifice - which is the soul of Christianity"4.In many ways, Britain was well placed for a short, sharp war with her continental rivals: the last decade of the nineteenth century has produced "An increase of 98.3 per cent in the size of the Army and a 70.9 per cent in the Navy"5. Marsh suggests the reason for this was the South African (Boer) War, but the ultimate result of this massive increase is that there were a large number of servicemen in the British Army at the outbreak of the war. Furthermore, there were pressing needs to develop a distraction for the British populace: the situation in Ulster was growing increasingly tense. As late as May 1914, the government was passing Home Rule legislation in order to contain the threat of war6. In a game of consequences with the Irish Nationalists, the Prime Minister Asquith was prepared to force a state of war in order to keep as much power in English hands as he could. Asquith was in trouble at home too, where the 1913 act that enabled Suffragettes to be force-fed was coming under fire.7 The additional problems of "intensified industrial unrest"8