How to hedge against a fall in value

Article Abstract:

House prices can fall as well as rise, and there is a one in six chance of a drop in house prices in the United Kingdom in any given year. Prices could drop in a specific area despite a price rise across the UK, due to local factors such as a factory closure. The end of mortgage interest relief, starting from 2000, will tend to depress house prices. Yale University's Robert Shiller has suggested a derivatives market for house prices, though it would be easier to deal with regional declines than drops in individual house prices. Shared appreciation mortgages allow equity release which could permit funds to be released for investment in equities.

United Kingdom, Usage, Derivatives (Financial instruments)

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The house that Tony built

Article Abstract:

Berkeley's managing director, Tony Pidgley, withdrew from the residential real estate market prior to its collapse in 1998. The company has acquired land cheaply at the start of the 1990s and has aland bank for three years. The next real estate slump is not likely to be as bad as the slump starting in the late 1980s, Pidgley argues. He is focusing on developments outside London, and sees the market in central London as near its peak. He is not concerned about a possible loss of opportunities to make a profit but is more concerned about protecting his assets.

Management, Officials and employees, The Berkeley Group Holdings PLC, Pidgley, Tony

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