What is the Network ?
 
 
This UK instigated Network is a group of practitioners (corporate, Individual and Associations) all of whom have extensive experience in unlocking the economic resources in land and property (i.e, all belong to one of the 6 pillars that make up a property market – see below).
 
 
 
They  will propagate and develop contacts with their counterparts in transition and developing economies (particularly focusing upon entrepreneurial companies and individuals) with a view to encouraging and helping those people to form local Common Interest Groups (CIGs) whose aim is, with the direct assistance of IntREAN members, to make progress in developing their property markets and instigating actual projects and learning by direct experience how to overcome the pitfalls.
 
 
 
Funding is therefore needed initially for a Secretariat who will assist the members in convening the Common Interest Groups and generally raise awareness in the UK, other Developed Economies and selected transitional and developing countries. It will also develop a website/portal, hold an International Forum and carry out all the activities listed below.  It is reasonable to assume that a CIG can be formed (in any willing economy) within 3 months; that it will coalesce into an effective group within 12 months; and that it may have a tangible project under development within 1-2 years and have held a local forum/seminar.
 
 
 
Why is the UK instigating this Network ?
 
We divide the property market into “6 Pillars” that support the market:
 
 
                    
 
The two main financial centres in the UK, London and Edinburgh/Glasgow, have world class companies and organisations in all of these “pillars” that together create and sustain the UK and many other country’s property markets. They are therefore ideally placed to offer help, advice and support to the transition and developing economies as they build their property markets and related institutions. By working together this can be achieved. With members from each of the “pillars”, we can be certain that the necessary help and support is co-ordinated and given in the right places and at the right times.
 
 
 
The Network will not just include indigenous UK organisations, but also those international organisations that choose to operate out of the UK.
 
 
 
Why is the UK a good example ?
 
The UK model is very relevant to any country seeking to improve the functioning of its housing market.  It is particularly relevant to transitional and developing countries for the following reasons:
 
 
 
·      It requires minimal scarce resources – in terms of people, institutions and money.  There is no need for example to create new         organisation (eg a “National Housing Bank”, national land authority, a national house building company or a mortgage market authority).
 
·      It is an evolutionary model that works with market forces rather than against them.
 
·      For the most part it involves the removal of controls and obstacles rather than establishing new procedures and institutions – although some may be needed, particular in respect of land registration and judicial bodies.
 
·      UK based expertise is readily available to provide assistance.
 
 
 
What is the Mission Statement ?
 
To help the development of functioning property markets in transitional and developing countries by facilitating access to expertise and experience within the UK and other developed real estate markets.
 
What is the Rationale for the Network?
 
Well-established property rights (from which various forms of home tenure and ownership develop) form the foundation of a country’s economy and a healthy financial system. Despite the sophistication and scale of developed country’s capital market, mortgages remain its cornerstone. The existence of this large, stable pool of finance, with a well-diversified risk basis, has been critical in the development of capital markets. Moreover, creation of a “homeowner class” is one of the surest methods to help a society achieve long-term economic growth and political stability.
 
 
 
Many of the transition and developing economies have begun the process of building the institutional capacity and infrastructure necessary to grow their property sectors that will bring broad economic and social benefits. But there is still a long way to go before they achieve a fully functioning and well regulated property market and there is much that developed countries can do to help, in turn helping to create new potential markets for themselves.
 
 
 
The main problems with many of these markets involve land rights and the legal system. It is only by highlighting how other necessary participants in the real estate market are being held back from entering that progress can be made. In the original EU15 countries with average owner occupancy of over 55%, household loans are on average nearly 50% of GDP. In the transition economies (with owner occupation averaging 90%) average household loans are about 10%. of GDP (Figures from UNECE and European Mortgage Federation statistics)
 
 
 
Will the Network work with other International bodies ?
 
The Network will work with any organisation involved with developing property markets internationally. It is building upon the work carried out since 1997 with the UN Economic Commission for Europe and their Real Estate Advisory Group (UNECE REAG). Following on from the work in the transitional economies, especially in Central & Eastern Europe, and with contacts and knowledge gained, the time is now right to create a more formal group here in the UK. But also with links to other similar organisations in other developed economies. The Network will help broaden and co-ordinate the extensive range of expertise that exists and keep members aware of the requirements, developments and opportunities within these property markets as they develop in these countries.
 
 
 
The Network will join and conform to the UN Global Compact and intends to form the first sectorial Global Compact Network for Property Markets. It will encourage its members to also join the UN Global Compact both here in the UK and also in all other countries where CIGs are formed or it is operating. Membership of the UN Global Compact indicates conformity to its 10 Principles and helps contribute to an organisation’s Corporate Social Responsibility (CSR).
 
 
 
What are the Objectives?
 
·      To raise the awareness of the economic and social benefits that a fully functioning real estate market can bring to a country, its businesses and individuals.
 
·      To ensure that the UK and other countries experience is available to those who wish to draw on it.
 
·      To encourage the establishment of Property Market Common Interest Groups (CIGs) in transitional and developing countries affiliated to the International Network.
 
·      To raise the standard of education, training and qualifications in their property markets
 
·      To strengthen the institutions, professional and regulatory bodies in their markets
 
·      To help overcome inertia and vested interests in transition and developing economies property markets
 
 
What will be the Activities ?
 
·       Arrange meetings with the UK Embassies of Developing and Transition Countries to explain and offer the services of this Network
 
·       In the UK to work with the Foreign & Commonwealth Office, UK Embassies abroad, UK Trade & Investment and other relevant bodies to make aware the services of this Network
 
·       Develop links and relationships with other International organisations involved in similar work
 
·       Encourage and support the development of CIGs in Developing and Transition countries
 
·       Create and maintain a website/portal
 
·       Commission a flagship publication on the UK model and market and prepare a promotional leaflet about the Network. These will be followed by a series of publications on specific areas (eg valuations or mortgage insurance) or case studies that Members will be able to contribute
 
·       To hold regular events on land and property markets, both in the UK and elsewhere, including an International Forum
 
·       Carry out regular Benchmark Surveys in transition and developing economies
 
·       Be represented, ideally as speakers, at important seminars and conferences on land and property to highlight the importance and services of this Network
 
·       Work with UK based education, training and qualification bodies to offer international standard courses and qualifications on land and property markets
 
·       The Network will instigate and encourage tangible demonstrator projects in countries that involve all the “6 Pillars” and result in the building of affordable, environmentally friendly and sustainable homes and related infrastructure (see separate paper on Urban and Rural Village concept)
 
·       The Initiative will NOT engage in developing any construction projects in its own name but will encourage its Members and others to do so
 
 
 
 
What are the main benefits of joining the Network ?
 
·      To be able to work with all the other participants within the 6 Pillars of the property market to enhance and influence the development of property markets in transition and developing economies.
 
·      To also enable companies to participate in the development of these markets without the necessity of immediately entering these markets but helping to create the environments for future involvement of their products and services should they wish.
 
·      Ideal and cost-effective way of demonstrating Corporate Social Responsibility (CSR) on an international basis.
 
 
 
 
 
How do we join the Network ?
 
For the Network to be effective it should have a large and broad membership from all parts of the property market. However, as stated above, we have firstly to establish the Secretariat and a website/portal. This will enable us to:
 
 
 
·      commission the paper on the UK Model and Market
 
·       instigate the CIGs
 
·       develop the Training, Education and Qualifications programme (especially as this year it is the main theme for the Lord Mayor of the City of London’s term of office)
 
·       run and publish Benchmark Surveys
 
·      encourage the creation of a demonstrator project
 
·      continue to raise the awareness and importance of the subject
 
·      hold an International Forum of CIGs and potential countries
 
·      attend and participate in related seminars, conferences, forums, etc.
 
 
 
Separate papers are available on all the above planned activities.
 
 
 
To now establish the Secretariat, ideally we are seeking the support of several Sponsors from amongst the 6 Pillars to make it representative. We would suggest at least an organisation from each Pillar who would, for the first year only, contribute as Prime Sponsors and similar numbers as Sponsors for the first year.
 
 
 
They would of course receive due recognition on all publications and publicity on an ongoing basis as being our original Prime Sponsors or Sponsors.
 
 
 
We would also be encouraging the participation of a larger Ordinary Membership for companies or SMEs at an annual fee.
 
 
 
After the first year the Founders would revert to normal annual fees but obviously retain the recognition of having been Prime Sponsors or Sponsors.
 
 
 
We will also be offering Associate Membership to like-minded international associations, but especially to the main UK associations such as HM Land Registry/Registers of Scotland, Law Society, Council of Mortgage Lenders, Building Societies Association, Association of British Insurers, RICS, Housing Corporation, Federation of Housing Associations, Institute of Financial Services, Institute of Arbitrators, etc. as well as Academic Institutions on a free reciprocal basis.
 
IntREAN
International Real Estate Advisory Network Ltd