The Introduction of Computers and Customized Software - Research Paper Example

 It is seen that in the context of UK property laws, the need for reforms, rationalised 'fit for purpose’ policy for government estate and proper controls are very much needed, for the reason that over the years, the asset planning has been autocratic and dealt with, by the central administrative powers, and not allowing different regions to evolve laws for their own administrative controls. (High Performing Property. 2009). Further, it is seen that with evolutionary process of laws, impact of the development and progress of Asset Planning from the literature available from the Audit Commission’s report is needed to be urgently implemented. The main aspect would relate to the induction of Geographical information systems (GIS) into land property matters which needs to be implemented without further delay. According to the report of the Audit Commission, it is believed that role of the local authorities in property management was minimal since it lacked the kind of information on property matters needed – as a matter of fact, many local authorities did not know what they owned. (Wyatt and Ralphs 2003, p.124). It was suggested that a property committee be commissioned whose primary duty would be to update all property records, and maintain an integrated, reliable database for property holdings of all authorities. The main idea for maintaining a reliable database could be in terms of: 1. Being able to affect data changes as and when necessary 2. Tailor the records to benefit individualised users and holders 3. Provide authorities wide access to corporate resources 4. Geographical analysis of property information 5. Enhancing the quality of map production. It is seen that the passage from paper records to GIS-enabled one is basically a change from staid and rigid static inventory to dynamic and well integrated property management. Since the publication of the report, there have been substantial investments in GIS by the local government. Due to improvements, land mapping systems have also improved. Again, there has been a fillip to planning functions and application procedures, archiving planning histories and administering land charges. Thus it could be seen that GIS has helped in the development and progress of asset planning in the UK context. Coming to the second aspect, it is seen that Commission ‘Hot Property’ 2000 Report delves into the need for efficient asset management and usage. Through proper estate care management in areas of repairs and maintenance, resource mobilisation and other critical areas it is believed that hot property seeks to revive and revitalize the estate management functions. Most of these suggestions added value creations and agencies started use of additional resource mobilization, even if they were holding property for public or non-profit making purposes. There is no doubt that the hot property report established the fact that local property is the key value issue and that the optimum use of local property, through resource mobilisation needs to be carried out. Coming to the next aspect it is seen that the new recommendations made by the ODPM seek to promote a higher level of service delivery and nexus between efficient property management and enhanced service delivery. “A key objective of this approach is to ensure that better value is obtained from property assets thereby making an increased contribution to serving the authority’s strategic needs. There is thus a greater emphasis on achievements, in terms of outputs and outcomes. (Murfin 2005). Coming to the role of OGC, it is believed that this body has a major responsibility in the management of public assets and is aware of its key role. “An asset base worth around £220 billion across central government underpins these services and needs to develop to reflect and support their evolution.” (Better Assess Management. 2009). The methods by which the Government proposes to provide needed fillip and encouragement to these would be through the disposal of extra assets for the sake of investments in new ventures, transferring assets to private hands where they could be better managed and effectively used for generating more assets and finally locating and using assets not fully visible. (High Performance Property: Routemap to asset management excellence. 2006). Thus, it is seen that the Audit Commission has been instrumental, to a very large extent, in enhancing values of property assets and ensuring a robust and reliable archiving systems for such assets. It has also contributed, in no small measure, to enhance the efficiency and effectiveness of contemporary property management planning and procedures, which could result in all round appreciation of property assets. Select and evaluate at least three Asset Planning indicators to demonstrate how to measure property performance along the range of Economic, Efficient and Effective. The three Assets Planning indicators that could be seen are: 1. Increasing revenues 2. Controlling costs and instituting cost saving measures 3. Improving cost/income ratios through technology. It is seen that spare locations and areas provided for carrying out public utilities could be used for gaining revenues, even if they are used for non-profit activities or for social causes. Thus, this could augment running costs and maintenance of property assets. Again effecting control over costs and other measures are essential in the context of asset planning, both in terms of asset optimum usage and also in terms of maintenance. Thus, better resource allocation could be made through preplanning of assets. Coming to the third aspect, it is believed that by improving costs/incomes ratios, property assets management could be major beneficiaries. 2) Action areas: There are several action areas that are necessary with regard to any company owning, leasing or otherwise occupying property. Companies can own, lease or occupy the property by other ways like taking it on rent. In case a company plans to go in for any of the above with regard to property, it is better to follow the suggestions given here. Due to the complicated nature of statutes in property law and to avoid or reduce any chance of litigation, it is better to take on the services of a professional real estate agent. Such agents will be familiar with all aspects of dealing in real estate and property. He will also be familiar with the local and national level statutes and laws. Moreover, the agent will have a large database of properties, their locations, costs, and other relevant information. It is easier for a company to find a suitable piece of real estate with the help of this database. Another factor especially with regard to commercial property is the location. In some types of businesses, certain localities will not be suitable. (6 Elements to Consider Before You Buy Commercial Property in the UK. 2009). Physical inspection of the property is extremely necessary because the brochure and sales talk could be misleading. It is better not to take a risk and be saddled with a poor layout or building. The purpose of buying real estate or property is also important. It can be bought for occupation, leasing out or resale by the company. In each of these cases, the considerations are different. If the purpose is to occupy the property, then an ideal location that is suitable for the type of business engaged in by the company is important. It need not be in a prime location. But if the intention is to sell or lease, a piece of land which will fetch the maximum returns need to be considered. Dealing in property can be discussed in relation to other viewpoints also. In order to get a good deal, it is pertinent to take the following actions. The first step is to establish credibility with the agent and the seller or buyer of the property intended to be bought or sold by the company. The other parties should understand that the company has the financial resources to buy the property. In case of selling, all relevant records and other issues, if any, should be revealed to the other party. If a clear picture is provided, then they will see the company as credible and trustworthy. Another action plan is the negotiation of the deal. In case of purchase, maximum information about the intended property has to be gathered. “Get the rent roll, historical operating statements, physical details, copy of maintenance contracts, real estate tax bill, copy of the hazard insurance, condition of depreciating components (HVAC, roof, etc.).” (Chautin). This will help in having an upper hand in the negotiation with the agent or seller. In case of selling or leasing, the buyer can have an upper hand in case the company is in financial needs. It is better not let the fact be known or the prices can be brought down by the other party. Once the negotiation is over, the next obvious step is closing the deal if terms and conditions are acceptable to both parties. It is better to avail the services of an attorney or lawyer when making the sale deed. If the deed is made by the other party, then it should be approved by the company’s attorney to see whether there is any loophole or mismatch between previously agreed terms and what is printed in the deed. There is something called ‘due diligence’ in every contract and it applies to dealing in property also. Due diligence can be defined as “A measure of prudence, activity or assiduity, as is properly to be expected from, and ordinarily exercised by, a reasonable and prudent person under the particular circumstances.” (Glossary: Due Diligence. 2007). Another important factor is that all statutory rules and regulations have to be complied with. There are a number of statutory regulations with regard to property. An example would be the home information pack mentioned below. Moreover land and property laws can be quite different from council to council and county to county. 3) Property information and the Home Information Pack: One of the most important set of documents that an asset manager needs to have is the Home Information Pack. This section has been dealt with in more detail because even though the home information pack deals primarily with privately owned property, the information that can be gained from it is relevant in commercial property transactions and management also. Hence the content and quality of the information that is seen in a well-prepared home information pack is relevant in the case of all property. The ‘Sellers Pack’ as the Home Information Pack was known at the time of introduction was the idea of the Labour MP Frank Dobson and was first proposed by him when the 1997 general elections were approaching. The main purpose of its introduction was because a large number of housing property deals was called off after an offer was made and before the final contract exchanged hands. Two common, but usually unfair, practices called gazumping and gazundering existed in the property market and it was to put an end or at least bring it down that the concept of the Home Information Pack was put forth. Either the buyer or seller can opt out of the negotiation right from the start of the offer until written agreements are exchanged. If during this period, the seller receives a better offer for his property, he can opt out without incurring any costs to reimburse the buyer for his expenses. This is known as gazumping. “'Gazumping' is the term used to refer to when a seller accepts an offer from one potential buyer, but then accepts a higher offer from someone else.” (Home Buying Guide: What is Gazumping. 2009). The opposite scenario holds good in the case of gazundering where the buyer can opt in order to get a reduced price on the property. “Under English law, the price you agree on is not definite until the `exchange of contracts'. Up until that time (usually 6 - 8 weeks after the seller accepts your offer for the property), the seller can choose to cancel the sale and accept a higher price from another buyer.” (What is Gazundering). It was calculated that almost one third of total sale transactions fell through before finalisation due to the practice of gazumping and gazundering. In February 1997 the Environment Secretary released a document bearing the title “No to Gazumping” which had the following sentence in it. “We are now proposing a system in which a seller or a buyer who goes back on an agreement would be obliged to meet the costs the other party had incurred in progressing to exchange of contract.” (Darby and Pugh 2005). The Home Information Pack was to provide all relevant information including the energy efficiency of the house and it was intended that this would make the whole process of selling a property much faster. In order to study its feasibility, a pilot study was conducted for 6 months starting in July 1999 which ended in July 2000. 189 people out of 80,000 responded to the Home Information Pack mail sent out. Those who responded could reduce average completion time of the negotiation from 69 to 48days. There was a drop up to 50% in failed transactions and only 6% of the participants were not satisfied with the process. Public opinion grew in favour of both the energy efficiency ratings and the Home Information Pack and it was ultimately passed as a part of the Housing Act. Even though the intended date of implementation was set for January 2007, it actually took place nearly a year later in December 2007. The contents are classified into compulsory items and voluntary or optional items. It should be noted that even though certain cases are exempt from providing the compulsory list until 1 June 2008, the paper does not take that factor into account since the period is only two months away. Almost all relevant information given here in this section is sourced from the web site regarding HIP of the Government. “Since 14 December 2007 every home put on the market, no matter what size, must have a Home Information Pack. It brings together valuable information at the start of the process - such as a sale statement, local searches and evidence of title - which could save you money, time and stress.” (Home Information Pack: Welcome). The compulsory documents that should be included in the HIP are: Index (Contents of the Home Information Pack) A sale statement (statement summarising terms of sale) Titular evidence Standard Searches (as per law) Energy Performance Certificates Commonhold Information (if relevant) Copy of lease (if relevant) The list of optional documents is: Home Condition Report Additional information regarding lease (if any) Guarantees/warrantees Other searchers required by law that may be relevant to the area. The law states that the seller can prepare the HIP by himself or its preparation can be assigned to professionals like real estate agents or others qualified to do so. The cost of preparing the pack has to be borne by the seller and it is fixed not by statute but by the market. The general of cost of a Home Information Pack lies between 200 pounds to 300 pounds. But some service providers include it as a part of the fee for other total services and some even do it for free. Buyers have the right to ask for a copy of the report and can again ask the seller to provide missing documents within a reasonable period of time. A Home Information Pack is not required in the following cases: Properties in Scotland and Northern Ireland. Private sales where the property is not offered on the open market (e.g. to a family member, neighbour or friend). Non-residential property or where homes are in mixed use with commercial property. Properties sold with sitting tenants and not available for owner occupation.  Portfolios of residential property.  'Right to Buy' sales by Local Authorities or other social landlords; Homes held on a lease of less than 21 years.” (Are There Any Exclusions from the Home Information Pack Regulations. 2008). Computer based information systems: “The introduction of computers and customized software has been the greatest advance ever achieved in property asset management, facilitating the recording, collating, sorting, manipulation employment and dispersal of information with speed and efficiency.” (Scarrett 1995). Customised and readymade software packages for the management of records and visual representation of the property is now available. At a more basic level, photographs of the property and building from all angles can be taken and stored in the computer. This can be viewed by prospective buyers or tenants. One of the most useful software in this regard is the computer aided design or CAD software. Dimensions of rooms and the entire building can be entered into the computer and the system will provide a virtual simulation of the rooms and building as if it were real. Users can experiment with colours and placement of furniture and other objects within a room without physically doing so. If satisfied with a design, scheme and layout, they can obtain a printout which can be implemented into the actual scenario. There are many commercially available software packages, but it is not intended to promote any one package developed by a particular company. Hence no names of any particular software are given here. Bibliography Are There Any Exclusions from the Home Information Pack Regulations. (2008). [online]. HIPS Direct. Last accessed 01 March 2009 at: http://www.hipsdirect.com/ Better Assess Management. (2009). [online]. OGC. Last accessed 01 March 2009 at: http://www.ogc.gov.uk/better_asset_management.asp CHAUTIN, Jerry. FAQ: Real Estate Investing. [online]. Last accessed 01 March 2009 at: http://www.tenonline.org/sref/jc6c.html DARBY, Sarah., and PUGH, Rob. (2005). The Home Information Pack. [online]. P.1. Last accessed 01 March 2009 at: http://www.eci.ox.ac.uk/research/energy/downloads/40house/background_doc_g.pdf Glossary: Due Diligence. (2007). [online]. Mortgages Ltd. Last accessed 01 March 2009 at: http://www.mtgltd.com/glossary.aspx?letter=D High Performing Property. (2009). [online]. OGC. Last accessed 01 March 2009 at: . High Performance Property: Routemap to Asset Management Excellence. (2006). [online]. OGC: Office of Government Commerce. Last accessed 01 March 2009 at: http://www.ogc.gov.uk/documents/CP0137HighPerformanceProperty.pdf Home Buying Guide: What is Gazumping. (2009). [online]. Home.co.uk. Last accessed 01 March 2009 at: http://www.home.co.uk/guides/buying/gazumping.htm Home Information Pack: Welcome. [online]. Last accessed 01 March 2009 at: http://www.homeinformationpacks.gov.uk/ MURFIN D J. (2005). Report of the Head of Property Services: Corporate Asset Management Plan Proposals for 2005/06. [online]. Last accessed 01 March 2009 at: http://www.charnwood.gov.uk/files/papers/cabinet_item_17_21_july_2005/Cabinet+item+17+21+July+2005.pdf SCARRETT. Douglas. (1995). The Computerized Office. [online]. Property Assest Management. Last accessed 01 March 2009 at: http://books.google.co.in/books?id=1QPbfoubkkcC&dq="property++asset+management"&printsec=frontcover&source=bl&ots=mIJxqzaZu2&sig=WW6uUPiql77VnxdVuZuUL4HAHY8&hl=en&ei=tM6pSfjTLJim6wP2h420Bg&sa=X&oi=book_result&resnum=1&ct=result#PPT84,M1 What is Gazundering. [online]. Last accessed 01 March 2009 at: http://www.firsthomebuyer.co.uk/th-master.php?file=gazunder.xml WYATT, Peter., and RALPHS, Martin. (2003). Local Authority Property Management. [online]. GIS in Land and Property Management. P.124. Last accessed 01 March 2009 at: http://books.google.com/books?id=CEiF5j3pTq8C&pg=PA124&dq=1.%09The+Audit+Commission+%E2%80%98Local+Authority+Property+:+A+Management+Overview%E2%80%99#PPA124,M1 6 Elements to Consider Before You Buy Commercial Property in the UK. (2009). [online]. Article Base: Free Online Articles Directory. Last accessed 01 March 2009 at: http://www.articlesbase.com/real-estate-articles/6-elements-to-consider-before-you-buy-commercial-property-in-the-uk--779911.html Read More