REDUCING THE BUDGET DEFICIT

Reducing the Budget Deficit



Reducing the Budget Deficit

Overview of the company

Indus estate agents are a Real Estate which is based in Essex with two offices. This small firm primarily engaged in buying, selling, renting and operating self-owned or leased real estate such as apartment buildings and dwellings and non-residential buildings. Indus Estate also specializes in real estate-related services, such as brokerage and property management. Moreover, other related activities include appraisal services, real estate subdivision and property development.

Microeconomic considerations for Indus Estate

The actors in the housing industry can be divided into the following groups:

Construction, management / administration and marketing of residential real estate portfolio: by housing companies and property developers

Management / administration of residential real estate in foreign stock: by property managers and property managers

Marketing of residential real estate in foreign stock: by housing agencies

Build and own use of residential property: by private home owners ( clients )

Major Microeconomic Actors

Understanding government policies and their implications: The global commercial real estate market is subject to a variety of policies, ordinances and zoning codes that differ among countries. Therefore firms must monitor new policies and their potential effect on operational costs and future developments.

Ability to effectively communicate and negotiate: A strong negotiating position with tenants and counterparties can assist industry participants in obtaining favourable lease agreements and property prices that maximize returns.

Good project management skills: The ability to efficiently manage developments, renovations and repairs can reduce operation costs and increase profit margins for industry participants.

Management of a high quality assets portfolio: Tenants tend to have a preference for properties in prime locations. Lessors should have skills in identifying local economic, demographic and social trends as tenant demand is less volatile in prime locations.

Maintenance of excellent customer relations: Understanding the needs of, and having good relationships with, existing and prospective clients can assist firms in gaining new business and retaining existing customers.

Superior financial management: A significant amount of capital and debt is used to finance property acquisitions and develop property. Therefore, companies must be able to properly manage cash flows, reserves and debt levels to grow and effectively manage property portfolios.

Proximity to key locations: Location is everything in this industry, as tenants pay a premium for buildings located near business centres, transportation hubs and entertainment venues. As a result, buildings in areas of densely populated metropolitan areas have higher rental income.

Access to highly skilled workforce: Real estate firms that employ highly skilled staff with specialized knowledge can develop a reputation for quality service and increase their bargaining power.

The following is the supply and demand graph of real estate in UK (www.ifo.de).

Figure 1)

The Role of Fiscal and Monetary Policies

Monetary Policy and Affect on Real Estate

The influence of monetary policy on the small real estate's (not just on cost but also on the availability of credit, or the willingness of banks to take risks) in an economy exercises and can also be due to their influence on economic activity and inflation expectations monetary policy on commodity prices, asset prices, exchange rates and ...