One of the most enduring sayings on Wall Street is "cut your losses short and let your winners run". Sage advice, but many investors still appear to do the opposite, selling stocks after a small gain only to watch them head higher, or holding a stock with a small loss, only to see it worsen.
No one will deliberately buy a stock they believe will go down in price and be worth less than what you paid for it. However, buying stocks that drop in value is inherent to the nature of investing. The objective, therefore, is not to avoid losses, but to minimize the losses. Realizing a capital loss before it gets out of hand separates successful investors from the rest. In this article we'll help you stand out from the crowd and show you how to identify when you should make your move.
Sunday, April 27, 2008
House Prices Still On The Rise
Daily Express Sat March 29th 2008, 02/04/2008.
House prices have risen by more than £30 every day over the past five years, it was revealed yesterday.The latest figures from Britain’s largest building society show that they have soared by 47 per cent since 2003.
The average value of a home has increased by 1.1 per cent in the year to the end of March, with the price of a typical house now £179,110, which is £2,027 more than the same time last year.
Last night experts insisted the findings showed that fears of a major housing market crash are unfounded. Despite the impact of the credit crunch and lenders tightening their belts, analysts say increasing demand has kept prices high.
Housing expert John Wriglesworth said “I do not believe we will have a price crash. We are an overcrowded island with an ever-growing population. People have an innate desire to be home owners and supply is short.
In those circumstances I think there is more chance of finding Elvis on the moon than house prices crashing over the next five years. Prices may not be rising as sharply as they have been but there is no sign of them going into freefall either.
The problem is that lenders are not offering the deals they were, but if you take a five year comparison house prices are way up."
House prices have risen by more than £30 every day over the past five years, it was revealed yesterday.The latest figures from Britain’s largest building society show that they have soared by 47 per cent since 2003.
The average value of a home has increased by 1.1 per cent in the year to the end of March, with the price of a typical house now £179,110, which is £2,027 more than the same time last year.
Last night experts insisted the findings showed that fears of a major housing market crash are unfounded. Despite the impact of the credit crunch and lenders tightening their belts, analysts say increasing demand has kept prices high.
Housing expert John Wriglesworth said “I do not believe we will have a price crash. We are an overcrowded island with an ever-growing population. People have an innate desire to be home owners and supply is short.
In those circumstances I think there is more chance of finding Elvis on the moon than house prices crashing over the next five years. Prices may not be rising as sharply as they have been but there is no sign of them going into freefall either.
The problem is that lenders are not offering the deals they were, but if you take a five year comparison house prices are way up."
Budget comment - Housing
Domenic Donatantonio, PlanningResource, 17/03/2008.
Planning experts have given a cautious welcome to the government's announcements that it has found sites for 70,000 extra homes on public land.
Consultancy Atisreal criticised the lack of co-ordination between national and local planning policies.
Development director Emma Andrews, said: “Identifying sites is relatively easy. The difficult part is delivering these sites through the planning system.
“The government may want to bring forward 70,000 additional homes, but it will be interesting to see how this will be achieved having regard to social, economic and environmental sustainable objectives.
“With the current focus on delivery, which of those three elements might have to give?”
RICS public policy officer James Rowlands said the commitment to making public sector land available for house building will only solve part of the land supply issues.
“Identifying sites for 70,000 new homes is a drop in the ocean when two million additional homes need to be built by 2016,” he said.
“Encouraging the re-use of existing buildings and allowing well-managed development on greenfield sites must also be encouraged if housing targets are to be met.”
Planning experts have given a cautious welcome to the government's announcements that it has found sites for 70,000 extra homes on public land.
Consultancy Atisreal criticised the lack of co-ordination between national and local planning policies.
Development director Emma Andrews, said: “Identifying sites is relatively easy. The difficult part is delivering these sites through the planning system.
“The government may want to bring forward 70,000 additional homes, but it will be interesting to see how this will be achieved having regard to social, economic and environmental sustainable objectives.
“With the current focus on delivery, which of those three elements might have to give?”
RICS public policy officer James Rowlands said the commitment to making public sector land available for house building will only solve part of the land supply issues.
“Identifying sites for 70,000 new homes is a drop in the ocean when two million additional homes need to be built by 2016,” he said.
“Encouraging the re-use of existing buildings and allowing well-managed development on greenfield sites must also be encouraged if housing targets are to be met.”
Saturday, April 26, 2008
Investors discover lucrative haven in Britain's farmland
Extracts from an article By Jerome Taylor, 17/04/2008.
As house prices fall, the cost of rural land soars to record highs; Overseas buyers and flight from cities produce 40 per cent rise in values.
The price of farmland is rising at its fastest rate for more than 30 years as wealthy city dwellers and overseas buyers seek a slice of idyllic rural England and jittery investors rush to move their money out of stocks and shares because of the global credit crunch.
In contrast to falling residential and commercial property values, the average price of farmland rose by more than 10 per cent in the first quarter of 2008, according to a study of agricultural property sales which will be published this month. "So far this year, we have seen some of the same trends we saw last year but at an even more accelerated pace," said Andrew Shirley, head of rural land research at the Knight Frank estate agency, which conducted the study.
According to the Royal Institution of Chartered Surveyors, the value of farmland rose by 28 per cent during the second half of 2007. The last time agricultural property prices increased at such a rate was during the late 1970s, when annual increases of 40 per cent were common. Knight Frank believes prices will continue to rise by between 10 and 20 per cent this year.
The increases are being fuelled by the astonishing demand for agricultural holdings at a time when food prices are at an all-time high and when very little farmland is coming up for sale. Savills Private Finance, an independent mortgage broker, said the amount of land coming on to the public market each year was down from about 600,000 acres per year in the 1960s to 125,000 acres a year today.
However, demand has never been higher. For the first time last year, so-called "lifestyle farmers" – City traders and investors who use their wealth to pursue agriculture as a hobby – overtook bona fide farmers as the chief buyers of agricultural property.
Knight Frank's figures for 2007 show that 38 per cent of farmland was bought by agricultural enthusiasts, compared to 32 per cent sold to traditional farmers. However, other estimates suggest that lifestyle farmers bought 45 per cent of the available land.
Analysts say instability in the world's financial markets is fuelling the rush for land as investors look to transfer their wealth from stocks and shares into holdings more likely to being a quick return. The price of wheat and other cereals has more than doubled in 12 months. While that means the cost of food is going up, it has also improved the profitability of arable farming and made it an attractive investment. At the same time, Britain's agricultural land is attracting interest from abroad. While more and more British farmers are buying up farms in Russia and the former Soviet states, our farmland is relatively cheap by western European standards. Fifteen per cent of British farms are now sold to overseas buyers. Last year, the Dutch overtook the Irish as the chief foreign purchasers, snapping up 6 per cent of the available property, compared to Ireland's 5.5 per cent. Investors from Denmark bought 3 per cent, as did others from Sweden, Norway and Finland. While studies show that the Irish tend to favour farmland in the west of England, northern European buyers are looking increasingly to East Anglia.
Jeremy Zeid, an arable market specialist at the estate agency Carter Jonas, said: "If anything, the credit crunch has strengthened the agricultural property market. Some people will have seen millions wiped off their investments but those who have placed some of their money into the agricultural sector will be rubbing their hands with glee.
"I would estimate that prices will continue to grow by between 10 and 20 per cent in the next 12 months. It will slightly depend on how much comes on to the market in the spring and autumn but it will pretty much be the opposite to what is happening in the residential sector, where prices are rapidly tailing off."
The boom in agricultural property is mirrored across the Atlantic. The most recent figures from the US Department of Agriculture show that the price of an average acre of arable land rose by 13 per cent in 2007 and is likely to go up by a further 15 per cent this year.
As house prices fall, the cost of rural land soars to record highs; Overseas buyers and flight from cities produce 40 per cent rise in values.
The price of farmland is rising at its fastest rate for more than 30 years as wealthy city dwellers and overseas buyers seek a slice of idyllic rural England and jittery investors rush to move their money out of stocks and shares because of the global credit crunch.
In contrast to falling residential and commercial property values, the average price of farmland rose by more than 10 per cent in the first quarter of 2008, according to a study of agricultural property sales which will be published this month. "So far this year, we have seen some of the same trends we saw last year but at an even more accelerated pace," said Andrew Shirley, head of rural land research at the Knight Frank estate agency, which conducted the study.
According to the Royal Institution of Chartered Surveyors, the value of farmland rose by 28 per cent during the second half of 2007. The last time agricultural property prices increased at such a rate was during the late 1970s, when annual increases of 40 per cent were common. Knight Frank believes prices will continue to rise by between 10 and 20 per cent this year.
The increases are being fuelled by the astonishing demand for agricultural holdings at a time when food prices are at an all-time high and when very little farmland is coming up for sale. Savills Private Finance, an independent mortgage broker, said the amount of land coming on to the public market each year was down from about 600,000 acres per year in the 1960s to 125,000 acres a year today.
However, demand has never been higher. For the first time last year, so-called "lifestyle farmers" – City traders and investors who use their wealth to pursue agriculture as a hobby – overtook bona fide farmers as the chief buyers of agricultural property.
Knight Frank's figures for 2007 show that 38 per cent of farmland was bought by agricultural enthusiasts, compared to 32 per cent sold to traditional farmers. However, other estimates suggest that lifestyle farmers bought 45 per cent of the available land.
Analysts say instability in the world's financial markets is fuelling the rush for land as investors look to transfer their wealth from stocks and shares into holdings more likely to being a quick return. The price of wheat and other cereals has more than doubled in 12 months. While that means the cost of food is going up, it has also improved the profitability of arable farming and made it an attractive investment. At the same time, Britain's agricultural land is attracting interest from abroad. While more and more British farmers are buying up farms in Russia and the former Soviet states, our farmland is relatively cheap by western European standards. Fifteen per cent of British farms are now sold to overseas buyers. Last year, the Dutch overtook the Irish as the chief foreign purchasers, snapping up 6 per cent of the available property, compared to Ireland's 5.5 per cent. Investors from Denmark bought 3 per cent, as did others from Sweden, Norway and Finland. While studies show that the Irish tend to favour farmland in the west of England, northern European buyers are looking increasingly to East Anglia.
Jeremy Zeid, an arable market specialist at the estate agency Carter Jonas, said: "If anything, the credit crunch has strengthened the agricultural property market. Some people will have seen millions wiped off their investments but those who have placed some of their money into the agricultural sector will be rubbing their hands with glee.
"I would estimate that prices will continue to grow by between 10 and 20 per cent in the next 12 months. It will slightly depend on how much comes on to the market in the spring and autumn but it will pretty much be the opposite to what is happening in the residential sector, where prices are rapidly tailing off."
The boom in agricultural property is mirrored across the Atlantic. The most recent figures from the US Department of Agriculture show that the price of an average acre of arable land rose by 13 per cent in 2007 and is likely to go up by a further 15 per cent this year.
jargon in land investments
Brownfield - a site that has previously been developed. Brownfield sites may have been used for a wide variety of former activities including, commercial buildings, housing, industry, airfields, parks and so on. These sites may even be still in use and are not necessarily ready for development.
Capital - The amount of money you invest is usually referred to as your capital.
Capital Gain - The amount your investment increases during the period of investment.
Clawback Covenant - A legal arrangement that allows a former owner to maintain a financial interest in a piece of land. It will entitle them to some of the proceeds of a subsequent sale.
Contract for Sale - This is the name of the legal document that covers any land sale in the UK and you should always carefully check the terms in it.
Covenant - Covenant is another word for an obligation on the part of an individual which is defined in a legal document. In UK land, covenants often appear on title deeds and prohibit certain uses of that land.
Density - When refering to UK land, density describes the number of buildings (usually homes) per acre.
DPP - Detailed planning permission
Deeds - These are the ownership documents issued by the Office of H.M. Land Registry.
Depreciation - The reduction in the value of an item over time.
Freehold - The title deeds of your land can be subject to different terms, freehold means that you have absolute ownership of the land as opposed to Leasehold where you are in effect renting it for an extended period.
Green Belt - Areas of land usually around towns and cities that are currently protected from development, although the Government is currently reviewing this policy.
Greenfield - An undeveloped site that is ready for development.
H. M. Land Registry - The UK government body responsible for tracking ownership of the land.
LDP - Local Development Plan. The local council's plan for its future building programme.
OPP - Outline planning permission
Open Countryside - Open farmland and fields that doesn't have the infrastructure nearby that is needed for development.
Return on investment (ROI) - Similar to Capital Gain, this simply means how much money did you make over and above your original investment. Often described as a % so if you put in £10k and got back £50k you made a 400% return on your original investment.
SSSI - Site of special scientific interest. Land that is heavily protected against development for reasons such as the flora, fauna or archaeological value of the site.
Title - In UK law, the Crown ultimately owns all of the land but grants ownership by title to others.
UDP - Unitary Development Plan. See LDP as they essentially are the same thing.
Capital - The amount of money you invest is usually referred to as your capital.
Capital Gain - The amount your investment increases during the period of investment.
Clawback Covenant - A legal arrangement that allows a former owner to maintain a financial interest in a piece of land. It will entitle them to some of the proceeds of a subsequent sale.
Contract for Sale - This is the name of the legal document that covers any land sale in the UK and you should always carefully check the terms in it.
Covenant - Covenant is another word for an obligation on the part of an individual which is defined in a legal document. In UK land, covenants often appear on title deeds and prohibit certain uses of that land.
Density - When refering to UK land, density describes the number of buildings (usually homes) per acre.
DPP - Detailed planning permission
Deeds - These are the ownership documents issued by the Office of H.M. Land Registry.
Depreciation - The reduction in the value of an item over time.
Freehold - The title deeds of your land can be subject to different terms, freehold means that you have absolute ownership of the land as opposed to Leasehold where you are in effect renting it for an extended period.
Green Belt - Areas of land usually around towns and cities that are currently protected from development, although the Government is currently reviewing this policy.
Greenfield - An undeveloped site that is ready for development.
H. M. Land Registry - The UK government body responsible for tracking ownership of the land.
LDP - Local Development Plan. The local council's plan for its future building programme.
OPP - Outline planning permission
Open Countryside - Open farmland and fields that doesn't have the infrastructure nearby that is needed for development.
Return on investment (ROI) - Similar to Capital Gain, this simply means how much money did you make over and above your original investment. Often described as a % so if you put in £10k and got back £50k you made a 400% return on your original investment.
SSSI - Site of special scientific interest. Land that is heavily protected against development for reasons such as the flora, fauna or archaeological value of the site.
Title - In UK law, the Crown ultimately owns all of the land but grants ownership by title to others.
UDP - Unitary Development Plan. See LDP as they essentially are the same thing.
Opportunity in UK land
The UK is one of the most densely populated countries on Earth and is the second most densely populated in Europe after Holland. Demand for housing continues to increase, year on year and there appears to be no end in sight. This has meant house prices continue to rise as demand outstrips supply.
The Government forecast in 2006 that the number of UK households in England would increase from 20.9 million in 2003 to 25.7 million by 2026.
This huge increase is fueled by a number of factors including:
The Government forecast in 2006 that the number of UK households in England would increase from 20.9 million in 2003 to 25.7 million by 2026.
This huge increase is fueled by a number of factors including:
- We are all living longer
- There is a rising divorce rate
- More and more people prefer single occupancy houses
- Mass immigration
- Old and poor quality housing stock
- Social aspirations
This massive home building programme puts pressure on developers to find available land either by re-developing existing sites, known as brownfield developments or by using new land such as redundant farmland.
Friday, April 25, 2008
Land investments
Hi All,
I was contacted by a company today that was into land investments,as this is something new to me i did all my usual research and found out lots of interesting articles on it.I will post the information i gathered tomorrow.
I was contacted by a company today that was into land investments,as this is something new to me i did all my usual research and found out lots of interesting articles on it.I will post the information i gathered tomorrow.
Subscribe to:
Posts (Atom)
