Hello everyone,
I've had an idea.
For the creation of a smartcoin that tracks the average value of the London Property Market.
During these uncertain economic times investors from all over the world are looking for safe haven assets to protect their wealth. Investing in London Property is well up there.
These involve physical gold, gold backed fiat IOUs, government bonds and other physical assets. The largest physical asset being houses. One of the most stable property market in the world is London. 1000's of years of History, ancient monuments, a seat of world power, a well protected UK sea-border and an educated workforce make London a high-security plot of land to own. Currently, investing in this land is complicated, and legally strenuous.
House ownership is complicated and expensive to share between multiple owners using the current UK financial/legal system. Buying and selling houses is also a rather illiquid market. Sale and purchase can take weeks or months. Especially if the particular area/borough of London you chose to buy a house in suffers from localised price-harming events; such as flooding, rioting... etc
Foreign fiat investment is also hard to get into the UK unless you are very wealthy. Ownership of a BitShares asset shares none of these complications.
The Existing Fiat Competition for BitShares. http://www.markit.com/product/Halifax-House-Price-Index
History
The HPI is the UK’s longest running house price series, with data extending back as far as January 1983.
The HPI tracks the UK property market, not London.
I'm not sure if you can directly invest in the HPI as an asset, or merely buy the data to use for ancillary-investments.
Coverage
122 HPI indices produced, comprising 5 monthly indices, 65 quarterly indices and 52 annual indices. All 12 UK regions covered, in addition to indices for all houses all buyers, existing homes, first time buyers and former owner occupiers.
Transparency
Publicly available methodology guides, providing users with clear understanding of model methodology and calculation.
Consistency
Methodology has remained consistent throughout the Halifax HPI history, enabling direct comparability of current index levels with historical values.
The classic way to play a property market recovery is to buy homes themselves, but that typically requires a hefty deposit running into tens of thousands of pounds and purchasing an illiquid asset that can take months to shift if you decide to sell.
Another option for investors not willing to commit quite so strongly to property is to pick companies that can benefit from a revival.
We asked Mr White to highlight his top stocks to take advantage of a property market recovery. He picks nine shares he thinks can benefit and This is Money highlights a tenth stock that has seen both severe pain and huge gains in recent years.
http://www.thisismoney.co.uk/money/diyinvesting/article-2442498/Ten-shares-advantage-property-market-recovery.html
The article then goes on to list Home Improvement businsess' that are likely to gain in value alongside a property market rise.
The investment instruments available to property investors are very limited, and can not invest directly or easily.
BitShares could produce a divisible, highly tradable asset that tracks the average sale price of London property over the previous 365 days. This would:- Reduce risk, as taking an average of all London property would mean that shocks within the London market would be damped by other areas of London.
- Allow minor investment of small amounts of money.
- Enable traders from all over the world to invest hassle free
The London Property Market is fueled partly by foreign investment. Wealthy foreign nationals buying houses as investments.
Buying a physical house limits the number of individuals who can own a share in the market, and restricts the amount of money that can be invested. Could you buy a £1 share in a house using current financial tech?
The deeds and legal fees would be enormous.
Why This asset could capture the safe-haven-investor market in ways that bitGold and bitIndex smartcoins haven't yetbitGold and bitIndex's that track stock exchanges are only crypto-izing existing financial products. Investors could get the same exposure via fiat methods. BitShares gives them security and privacy in this case, but does not provide an entirely new asset.
bitLPM (LondonPropertyMarket) would enable accurate exposure to a market that investors have sought after for decades, but have only been able to gain proxy-exposure to. An Index of the Average Property Prices of the London Property Market.
Potential Elements involved:- The London Property Market
- Established Estate Agencies/Realtors to stake their reputation on a quoted property price figure.
- BitShares-literate Witness'(?) who scrape the estate agent data, take averages and calculate the value of the index
Aligning Incentives Estate Agents/Realtors are very used to working for a commission. They are notorious for being ruthlessly profit hungry.
Scenario: An Estate Agency publishes the lowest property price for a habitable dwelling on their books over the past one week period, on a weekly basis. Multiple estate agencies are involved so as to achieve price data for each of the London Boroughs. The data is then weighted to get an accurate value of the average price of property in London overall.
This could be achieved by the (large and established, trustworthy) Estate Agency publising a price on their website or social media, and then signing it with a private key. They could use any crypto of their choosing so long as they can satisfy the market that their reputation as a trusted business is behind the price that they quote.
These Estate Agencies would need to be financially rewarded by the bitLPM or BitShares.
Witness's(?) who curate the index and collate the estate-agency data would need to be incentivized to do so. These calculations should follow as simple a formula as possible, so as to be easily verified by non-expert investors.
To produce this bitLPM index would require a few potentially complicated moving parts.
Accuracy could be reduced in order to gain simplicity and reliability, as investors are more likely to be looking to achieve a stable safe haven asset. So long as bitLPM performs with the same trends as the London Property Market, then it is fulfilling it's goals.
Even if this bitLPM doesn't get created soon, the very fact that BitShares enables this kind of commiditization of previously unattainable assets is amazing.
Once the world realises this is what they need, their research will lead them to BitShares as the most secure, reliable, and well-priced technology to do it for them
Topic: Idea: London Property Market Smartcoin. Market Research,Implementation Hypothesi (Read 1913 times)
