Risk And Uncertainty Flashcards
1
Q
How can developers reduce risk?
A
Pre let/ sell at agreed rents
Negotioate short term finance at fixed rates of interest
Offers fixed price contracts to builders
2
Q
Downside of risk reduction?
A
Will normally cost more to the developer
3
Q
What does rent change affect?
A
GDV
Letting few
Investment sales fee
Occupier sales fee
4
Q
What has a big effect on profit?
A
Rent
5
Q
What has a small affect on profit?
A
Disposal period
6
Q
Optimistic scenario?
A
Economic growth Increased demand for housing- prices increase Yields fall Building Tender prices increase Interest rates raised Property sold quickly
