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18 posts from August 2007

August 31, 2007

The Scarcity Shortage

The Scarcity Shortage


What's worth more: a pile of gold or a pile of salt? Throughout history, many people have chosen the salt. Gold is pretty, but you can't live without salt, and when it was more scarce than gold, it became valuable enough to use as a currency itself. (The word "salary" is even related to the Latin for "salt.")

Today, of course, salt is close to worthless. Given the choice between a pile of salt and a pile of gold, you'd go for the gold every time, because there's less of it around.

Scarcity, it seems, has a lot to do with value.

...we're running out of a lot of important things--clean water, free time, breathable air, the ozone layer, and honest leadership, just to name a few. At the same time, we have to worry about something that is about to affect just about every business I can think of. We're running out of scarcity.

Scarcity, after all, is the cornerstone of our economy. The best way to make a profit is by trading in something that's scarce. This is why the music and movie industries are so terrified by the millions of people who download entertainment from the Internet every day. Downloading threatens to make supply virtually unlimited, and that could make their offerings about as valuable as those of some kids down my street who recently tried to run a stand selling freshly made mud.

It seems as though once a category becomes successful, the headlong rush to knock it off is stronger (and quicker) than it ever was before. Last week, a woman who came to a seminar in my office was desperately searching for a way to improve her mortgage-brokerage business. I ruined her day when I suggested that she shut her company down and try something else. Twenty years ago, most mortgages were written by the local bank. Those banks planted the seeds of their obsolescence when they eliminated judgment from the writing of mortgages. Once they could automate a mortgage application, so could everyone else. So mortgage brokers used their low overhead and quick wits as an advantage and stole the business. Today, there are an infinite number of brokers to choose from, all offering essentially the same service. The result is that there is no scarcity, and no profit.

It's not just about product knockoffs, of course. While there are almost half a million lawyers practicing in the United States today, there are (gasp!) more than 125,000 in school right now. No matter what you believe about lawyers creating ever more work for ever more lawyers, there's no question that with so many of them, they're hardly scarce.

The same thing is true for doctors, Web sites, T-shirt shops, sushi restaurants, thumbtack manufacturers, and brands of blank CD-ROM disks. There are 100 major brands of bottled water. Someone opened a fancy ice-cream parlor in Manhattan, and then there were six.

If it's remotely digital (like music), then it's easy to mimic. And if it's easy to mimic, someone wins if they can knock off the original--the sooner the better. When someone starts to sell exactly what you sell but for half the price, how long does your good-service, first-mover, nice-person advantage last?

Zara, the fast-growing European clothing store, can knock off a new fashion before the original designer even gets it to the upscale department stores. Suddenly, the original appears to be the copy.

So how do you deal with the shortage of scarcity?

Well, the worst strategy is whining--about copyright laws and fair trade and how hard you've worked to get to where you are. Whining is rarely a successful response to anything. Instead, start by acknowledging that most of the profit from your business is going to disappear soon. Unless you have a significant cost advantage (like Amazon's or Wal-Mart's), someone with nothing to lose is going to be able to offer a similar product for less money.

So what's scarce now? Respect. Honesty. Good judgment. Long-term relationships that lead to trust. None of these things guarantee loyalty in the face of cut-rate competition, though. So to that list I'll add this: an insanely low-cost structure based on outsourcing everything except your company's insight into what your customers really want to buy. If the work is boring, let someone else do it, faster and cheaper than you ever could. If your products are boring, kill them before your competition does.

Ultimately, what's scarce is that kind of courage--which is exactly what you can bring to the market.

August 25, 2007

Cyprus house prices up 1.8% in July, 9.7% y/y

Cyprus house prices up 1.8% in July, 9.7% y/y

4wallsandaceiling.com Newsletter

Source Financial Mirror

Nick says…

You’ve got to get in there asap to keep getting theses gains. If you track–back over the last year this has been happening on a month-by-month basis, consistently.

Remember not moving forward in any form of investment does not mean you are standing still… by default you are moving backwards.

If you have been thinking about investing in Cyprus for a while then I think now would be a good time to act… you still have the time to make the most out of the opportunity.

Below is an e-book we have written to help you in that decision making.

Residential house and apartment prices in Cyprus rose for the seventh consecutive month in July 2007, as the BuySell Home Price Index rose by 1.8% over the previous month to 129.05.

Compared with the same month of the previous year, home prices in Cyprus rose by 9.7%.

The average home price according was recorded as CYP 100,546 (EUR 171,793).

The BuySell Home Price Index was created and is updated monthly on behalf of BuySell Cyprus Real Estate by MFC S. Platis.

The Index is announced during the second week of each month and depicts the movement of prices at which residential properties are sold in Cyprus, based on the extensive BuySell Cyprus Real Estate database.

For more information on the methodology of the Index and on Hedonic Prices please refer to: The “Asking Price and Transaction–based Indices for the Cyprus Housing Market (Rebased)” by Dr. Stelios Platis and Marios Nerouppos of MFC S. Platis.

The BuySell Home Price Index constitutes the only valid gauge of the Cyprus housing market and is considered as an effective tool for home buyers, sellers and investors.


If you are interested in purchasing investment property or your own home in Cyprus, you should consider buying this book. It has 31 pages of the most concise information you could ever need when it come to buying property in Cyprus. From the Legal ramifications through to the Banking issues, all of which is complimented by some beautiful photographs of the island.

Available at 4wallsandaceiling.com for only £4.99.

August 23, 2007

House price index August 2007

Click Here for House price index August 2007

Nick Says...

Click on the above for the latest House Price Index, courtesy of Rightmove.


August 22, 2007

£20,000 fine for TV hunk Phil

£20,000 fine for TV hunk Phil

4wallsandaceiling.com Newsletter

Source Liverpool Echo Aug 14th

Nick Says…

Interesting story this, the basis of it are the changes in the law april last year (2006) with respect to Houses of Multiple Occupation (HMO). “Liverpool magistrates court heard Olivier broke new regulations which came into force last year, which require houses of three storeys or more and occupied by five or more unrelated people to be licensed by the council”. If he had been well educated or well networked then this would probably never have happened.

The reality is that as a landlord HMO is a very attractive proposition, however, with that comes the responsibility that the local governments dictate. This does not mean that it should be a burden taking on an HMO it just means that you have to MIGHT have to make some changes to the property AND/OR get a licence… either way it may not be a great problem.

Note I said might be a problem. The rule of thumb is that any property over 3 stories or occupied by 5 or more unrelated people may need a licence and/or need some changes made to the property… however this a rule of thumb, in reality it may change from region to region.

In this instance he was either trying to evade the law or he just did not know… the price of ignorance far out-weighs the price of education…£20,000 ouch.

The answer to this is to get yourself educated… try our recommended training course, amongst other things we cover HMO.

TO MILLIONS of fans, he is known as the pin-up star of Liverpool-based television hits Brookside and Hollyoaks.

But actor Philip Olivier is now the holder of a less prestigious title.

He has just become the first person in Liverpool to be prosecuted for breaking a strict new law aimed at raising standards in rented houses.

Olivier was fined £20,000 by magistrates for being the landlord of a multi-occupancy house – a property rented out to five or more people – without a licence.

Officials believe up to seven people were living at the property in Wellfield Road, Walton, which Olivier did not own but was the landlord of and received rent for.

Liverpool magistrates court heard Olivier broke new regulations which came into force last year, which require houses of three storeys or more and occupied by five or more unrelated people to be licensed by the council.

They were brought in following government research that showed people living in these types of property are 16 times more likely to die or be injured in a fire than people living in a single occupancy house.

In some areas in Liverpool this risk increases to 30 times.

Olivier, 27, of Back Commutation Row, Liverpool city centre, who appeared in court under his full name Philip Borg-Olivier, was the first person prosecuted by the council.

He was found guilty on two counts in relation to the Wellfield Road property and was also ordered to pay £250 costs.

It is understood the house has now been sold.

Council officials took action against Olivier after receiving a police tip-off.

Cllr Marilyn Fielding, executive member for housing, said: “This case sends out a serious message to landlords that they must make sure they comply with the law.

“We will take robust enforcement action against all landlords who ignore licensing.

“They have no excuse as this legislation has been widely publicised locally and nationally, so my advice to owners is to apply for a licence now or be prepared to face the consequences.”

Olivier, a former pupil of St Edwards College, West Derby, shot to fame playing Tinhead in Liverpool soap Brookside before starring in The Games, which he won, and Hollyoaks: In The City.

He is the grandson of former Maltese prime minister Giorgio Borg-Olivier.

August 21, 2007

Landlords push for property

Landlords push for property



Nick says…

One of the main attributes to property investment, other than making money, is the peace of mind it gives you.

If you think about it, most other forms of investment involves parting with your cash to some other individual (of whom you probably never have met) in the vain hope they are going to give it back (and some) in 20 or so years time…. Trusting someone else with your cash is , in my mind, probably not the best thing.

However, with property YOU are in control over what you do, you live and die by your own hand.

Life is better when you answer and trust to the person you see in the mirror!

Remember, you have leverage and a proven history on your side.

New landlords are choosing buy-to-let over other investment options according to Mortgage Trust.

Landlords are opting to purchase more properties because they believe this asset class will give them more control over the success of their investment.

Nearly a third of new landlords state that control over their investment was a major factor influencing their decision to invest in property. This is up on the 28% who cited it as a major influencing factor in January this year.

Unlike many other investments, landlords are in the driving seat with property, and to a large degree they can control whether a property investment is successful or not. By doing their homework properly, they can choose the location and type of property that is in demand in an area, as well as maintaining the property to a high standard so that it is easily let – thereby keeping void periods low and rental income high.

John Heron, managing director or Mortgage Trust, commented: “Five interest rate hikes in a year have left investors increasingly risk averse. When investing in stocks and shares, your only option if you don’t like the way an investment in a fund or company is performing, is to sell. With buy-to-let, landlords are in the driving seat. As financial markets become increasingly volatile, this level of control will become more attractive to investors

A further two thirds of landlords are primarily attracted to buy-to-let because they believe they will be able to achieve better returns than on other types of investment.

John Heron concluded: “Investors continue to be attracted to the private rented sector due to the attractive returns – our index indicates that yields have been stable around the 6% mark for over a year, whilst total returns on a 12 month investment stand around 11%. When gearing is taken into account, the effective yield and total return are much higher. Whilst there is uncertainty in many financial markets at the moment, it is clear that landlords believe buy-to-let remains a solid investment option.’’

August 20, 2007

Buy-to-let brigade could be the joker in the homes pack

Buy-to-let brigade could be the joker in the homes pack

4wallsandaceiling.com Newsletter

Source The Times

Nick Says…

I like The Times, they always seen to have an open view on subjects, whatever they might be. Having been in the business for a number of years you can probably guess how many different opinions on forecast I have heard, however, all of them are just that…opinions and opinions are personal to the individual.

The point is markets, whether they be in property or not, change and we as investors need to change with them. To give you an analogy, when it starts to rain during a n F1 race Lewis Hamilton (F1 driver) does not stop racing… he puts on his wet weather tyres and changes his strategy to suit the conditions.

As this piece suggests “During the last housing crash, of 1989-94, interest rates spiralled to more than 15 per cent. Yet the price of an average home in Britain today is three times the cost of one 15 years ago". It would appear then that all we need to do is “put on our wet tyres” when the going gets tough. (How can they call it a crash and yet state that the average house is worth 3 times more now… all in the same sentence is beyond me!)

How you put the tyres on and where you get the information from… well that’s the game.

This is where education comes in. With education you will stop seeing “opinions” as the written rule and only use them to guide your actions… the art of investing is finishing “the race” what happens on the way you just deal with such as booms and busts, property bubbles growing and property bubbles bursting… provided that you take the medium to long term view and don’t treat it as a get rich quick scheme PLUS, and this one is the big one, make sure you always have POSITIVE CASHFLOW this way you are building in safety valves to take you through.

Remember the word “crash” is for the media. You never win and lose, only win and learn.

Get yourself educated, Click here to find out more.

In polite circles there is one C-word that remains taboo. Crash. We can whisper it or think it, but anyone saying it aloud faces ostracism from our property-obsessed culture.

We may have to overcome our objections. House price inflation is cooling in England and Wales – but still rising in Scotland and Northern Ireland, although for how long? – and the assumption that property prices can only ever move in one direction may need to be revised.

In April mortgage levels fell to their lowest for a year. It could mark the start of a prolonged cooling-off. Nationwide, Britain’s largest building society, says that house price growth across the country is set to slow further in 2008 to just under 5 per cent. Fionnuala Earley, its chief economist, pointed out that the three-month rate of house price inflation was running at 3.5 per cent in January. By May, that rate had more than halved.

The average price of a home is now about 10.3 per cent more than a year ago, but the underlying picture leads economists to predict that annual inflation will have fallen to between 5 per cent and 8 per cent by December. Price inflation in the North of England has already slowed to 5.3 per cent during the first half of this year.

True, in London and a handful of its satellite cities and towns prices are still roaring ahead. Estate agents believe that they will carry on rising in 2008 at a multiple of the increase in average earnings, possibly by as much as 10 per cent. Cash-rich buyers in the South are less influenced than their northern brethren by the recent rises in interest rates. These buyers are chasing a limited stock of housing, forcing up prices. Savills, the property agent, records inflation of up to 40 per cent for sales of multi-million-pound homes in parts of Chelsea and Belgravia in just the first five months of this year.

Yet beyond the enclaves of West London, the picture is less rosy. But will the predicted cooling become a crash? A few key assumptions will come into play.

The first is confidence. The housing market relies on confidence like any other. First-time buyers in Bolton need to be confident that their astronomical mortgage is worth it, just as Belgravia depends on confidence that London will continue to be a magnet for international money. If interest rates rise much above 6 per cent, experts believe that much of this confidence could evaporate.

During the last housing crash, of 1989-94, interest rates spiralled to more than 15 per cent. Yet the price of an average home in Britain today is three times the cost of one 15 years ago. That means that it takes a much smaller rise in interest rates for home-owners to find themselves in difficulties maintaining the bigger borrowings needed today.

Yolande Barnes, head of residential research at Savills, said: “We are in uncharted territory. A lot of the market is based on the willingness to sink large amounts of wealth into housing. It is confidence-based. That tends to make it more volatile. There is even a problem if interest rates get to 6.5 per cent. That is the absolute biting point. That would probably trigger a household debt crisis similar to the late 1980s.

“We think at that point all the household spending surplus disappears, once you have paid housing costs and the basic cost of living. A widespread crash is, however, unlikely. It would take extreme circumstances and the broad economic environment is benign.”

There is a third assumption, which cannot be tested by looking back to the last housing crash. Buy-to-let investors are relatively new in the market. Figures from the Council of Mortgage Lenders show that buy-to-let mortgages totalled £38.4 billion last year, representing 11 per cent of mortgage advances made during the year. Two years ago some analysts predicted a wave of forced sellers among buy-to-let investors that they said could send house prices crashing 40 per cent. That fear never became reality.

Property pundits will hope that these new real estate owners remain long-term investors as interest rates start to rise.

August 19, 2007

Holiday Rentals, Cyprus offers "great potential"

Holiday rentals, Cyprus offers "great potential"

4wallsandaceiling.com Newsletter

Source Holiday rentals

Nick says...

Lets have a look at this. We already know that there is a big demand for holiday rentals in Cyprus, this piece of writing gives you some more peace of mind.

Over the next few months I will be focusing on holiday rentals in Southern Cyprus to give you the info behind it.

Cyprus offers "great potential"The island of Cyprus is proving to be a major attraction for both property investors and holidaymakers, claims a real estate expert.

Paul Tomlin from Buy Abroad believes that Cyprus is enjoying a sustained boom period, with properties in the south of the region proving to be particularly popular as holiday homes and rentals.

Mr Tomlin said: "I've got to say Cyprus is our most common – that's where we do most of the business."

He added: "I can’t believe how the prices have gone up. It's been a progressive growth each and every year for the last two or three years."

Cyprus is currently the fifth most popular foreign destination for UK holidaymakers with a very favourable climate offering more than 300 days of sunshine per year.

In addition, the country's move towards European Union membership and adoption of the euro currency is helping to boost overseas property investment on the island.


If you are interested in purchasing investment property or your own home in Cyprus, you should consider buying this book. It has 31 pages of the most concise information you could ever need when it come to buying property in Cyprus. From the Legal ramifications through to the Banking issues, all of which is complimented by some beautiful photographs of the island.

Available at 4wallsandaceiling.com for only £4.99.


August 18, 2007

Charming southern Cyprus sees speculation surge

Charming southern Cyprus sees speculation surge

4wallsandaceiling.com Newsletter

Source Assetz

Nick Says…

Always good to keep up-to-date with what’s happening and other peoples input. Cyprus continues to be one of the best investment spots in the world, I would suggest, at the moment.

So if you are going to invest in Cyprus then you need to do so asap.

Interest in southern Cyprus is mounting among investors looking to take advantage of the potential gains offered by up-and-coming property hot-spots around the globe. And while traditional favourites such as France and Spain continue to be popular among British investors, it seems another destination is successfully competing for attention.

Southern Cyprus, home to popular holiday destinations Paphos and Larnarca, is coming to the fore as more and more Britons choose to buy property there either with retirement, a vacation or pure investment in mind.

The sunny climate and the fact that English is widely spoken is particularly appealing to those who want to combine a taste of the exotic with home comforts.

Indeed, Paul Tomlin, the sales director of property firm Buy Abroad, commented that Southern Cyprus offers property investors a great mix of appealing factors. He said investors are drawn to a "combination of everything".

He said: "It has good climate, everybody feels comfy there because everyone speaks English, and they drive on the same side [of the road] as they do in the UK." These are particularly important for people planning to relocate to the country or spend extended periods of time on the Mediterranean island.

But what about investors? Southern Cyprus has an ideal environment for dealing with the administrative issues concerning buying a property, according to Mr Tomlin. He said with the country's legislation for buying land, the majority of contracts are in English so those investing are at ease with the legal system governing the transaction.

Interest in the country's property market is expected to be fuelled by June's EU announcement that Cyprus will adopt the single European currency at the start of 2008. From January 1st next year, Cyprus and Malta will join the eurozone, with currency specialist HiFX predicting a boom in inward investment as a result.

The firm said Britons are attracted to the strong economy and local culture offered by the country, while many have a "soft spot" for the sunny island. HiFX marketing director Mark Bodega said "a number of reasons" are expected to boost the local property market.

"British purchasers like the legal system in Cyprus as it is easy to understand - being based on the English one," he said, adding that government policy also has an appealing environmentalist slant. "Properties cannot exceed a certain height, density is monitored and green areas are planted within developments," he commented.

Information website All Cyprus Properties also suggests that Britons feel right at home on the former British colony. In addition, it states that property prices in the country have shown healthy growth over the last few years and that while it concedes "past performance is no guide to future prices", it suggests that "now is the perfect time to buy".


If you are interested in purchasing investment property or your own home in Cyprus, you should consider buying this book. It has 31 pages of the most concise information you could ever need when it come to buying property in Cyprus. From the Legal ramifications through to the Banking issues, all of which is complimented by some beautiful photographs of the island.

Available at 4wallsandaceiling.com for only £4.99.

August 16, 2007

Rental demand should remain high for foreseeable future

Rental demand should remain high for foreseeable future

4wallsandaceiling.com Newsletter


There were good tidings for the UK buy-to-let investor this week as a number of industry bodies acknowledged that the present housing crisis shows no sign of abating and will not be solved by quick-fix measures. Most also agree that simply building more houses is not the way forward.

For example on Wednesday, the Campaign to Protect Rural England (CPRE) responded to Gordon Brown's proposals to tackle the housing crisis by, among other things, increasing the use of brownfield land for the development of new homes.

Paul Miner, planning campaigner for the CPRE, believes that this will do little to solve the problem because "new housing stock forms a very tiny proportion of the overall housing stock". He explained that house prices are thus set by the going rates on existing stock rather than by new builds.

He added: "This has actually been recognised by the government's own review of housing supply carried out by Kate Barker - which recommended quite a large-scale increase in house building. Even in her review, she recognised that significantly increasing the supply of housing would have little or no effect on prices."

So why is all this good news for the buy-to-let investor? Well, residential landlords always have a key target market. This is often dependent on property type, price and location and typical examples include housing for students, young professionals or nurses.

However, all landlords stand to benefit when the housing climate stands as it does now. People are finding it increasingly difficult to acquire a property of their own.

Rising house prices mean bigger deposits and more stamp duty, and of course a bigger mortgage. Often this will be for full or near full loan-to-value and mortgage periods in excess of 25 years are now common.

Interest rates have risen continuously since last August and these increases too show no signs of abating.
All of this means that landlords can expect to see strong demand for rental property in the foreseeable future, which may be enough to prompt people thinking about investing in a buy to let property to take the plunge.

August 15, 2007

Property portfolio Management/Tax software.

This is the Property Management/Tax software we use.

I've mentioned in the past you should always have complete and utter electronic control over a growing or fledgling Portfolio. We have set up a special offer with Property Tax Portal. If you purchase the software through 4wallsandaceiling.com you will geTax_softboxt a 5% discount plus a FREE BONUS BOOK worth £44.99 called "Pay less Property Tax"... your typical night time reading... joking aside, it is a good one and something you WILL use.

This is what they say...

"This unique piece of software will allow the property investor and landlord to proactively take on the challenges:

• ... to manage and track properties/tenants and all associated income & costs
• ... to pay the correct and minimal amount of tax
• ... to make informed investment decisions, so that you know exactly how well your properties are performing.

How will landlord property tax manager benefit me?

Landlord Property Tax Manager is an easy to use and powerful piece of software that is guaranteed to save you time, money and effort when it comes to managing your properties. "

...and they're right it does solve a problem we all have to deal with very efficiently. This product will be useful and well worth looking into.

Go-to this link and read a bit more...


Drop me a line if you have any questions.