Commercia Commercial Property Case Study

977 Words 4 Pages
Q1
Introduction
Investment is an essential part of people’s life, people who have extra money would like to invest their money to generate profit. There are some ways to make investments such as stocks, future goods, bonds, savings accounts, property and so on. Savings accounts just have about 3% interest rate which is lower than the investors’ expectations, and stocks and future goods are too risky for general investors even if they have high expect returns. As a result, investing in property is a good way among all methods and attracts investors in all over the world.
Property can generate a flow of income, as well as a return of capital. People will invest in the property which could be preserved or increased in value or returns. It is a large asset class of portfolios in financial areas, and investing in commercial property is essential, about 80% of investment portfolios.
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From property data report 2014, ‘the value of the UK’s stock of commercial property increased to £683 billion in 2013. The 5% increase in value over 2012 mainly reflected lower yields’.
Reasons
Let us concern about the benefits of investing in property which attract people to make the investment decisions.
First, property market is stable compared with others such as stock market. Same as any other assets, property also can trade in the market, and price can drive the supply and demand for property. Theoretically, if the supply does not change, and the demand changes, there could be a price reaction. We could see from the graph that whether the demand is elastic than supply or not, the price of property goes up and down in short term, but over a period, the market could move to

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