marketing, buying and selling property

Question 1

what is tenure

Answer 1

The basis upon which property is held

Question 2

what are the four different types of tenure

Answer 2

*Free hold - with VP – vacant possession i.e. empty
*Freehold – investment – when its sold with tenants currently in
*Long leasehold – 99 – 125 years can be as long as 999 years
*Leasehold – lease granted usually for 3-25 years

Question 3

what are the types of disposal

Answer 3

*Private treaty:
o Most common method of disposal.
o An agent places a property on the open market with a view to negotiating a sale with ANY interested party
*Auction:
o A sale in which property is sold to the highest bidder
o Usually a much quicker but often for struggling secondary or tirtary properties
*Formal tender:
o Potential buyers are invited to submit best bids at a prescribed place, time and date
o As a disposal agent you don’t know who will bid. Not always the highest bidder. E.g 14 mill cash could be better than 15 mill with a 7 mill loan
o Prestige assets sold this way
*Informal tender:
o Mix of private treaty and formal tender
o Not as common

Question 4

what are the 4 P’s

Answer 4

*Product – what is it, could include a service
*Price – how much will it be cold
*Place – where is it going to be sold. Can be physical or virtual
*Promotion – how to promote

Question 5

what is a property market?

Answer 5

A system through which “rights and interests” in land are traded.

Question 6

what anchors property market research

Answer 6

profitability

Question 7

when would you use the formula for amount of £1

Answer 7

The formula to calculate the amount of £1 in a given number of years at a specific interest rate is used to calculate the amount to which £1 invested now will accumulate at compound interest.

Question 8

when would you use the formula for present value of £1

Answer 8

The present value formula is used to calculate how much you would need to pay today for a future amount, given a specific interest rate and compounding period. For example, if you expect to receive a $5,000 payment in five years, and the discount rate is 8.25%, you can calculate the present value as $5,000 ÷ (1 + 0.0825)^5 = $3,363.80

Question 9

when would you use the formula for amount of £1 per annum

Answer 9

The formula for the amount to which £1 per annum invested at the end of each year will accumulate at compound interest is given in Parry’s Valuation and Investment Tables.

Question 10

what is the most common form of disposal and what does it involve

Answer 10

Private treaty - the method of sale whereby an owner or agent places a property on the market with a view to negotiating a sale with any interested party