Dear friends

As promised pleased find bellow the results of the survey that ranked the preferred criteria to assess property investment risk in a european context

The AHP (Analytical Hierarchy Process) methodology used in this research has been recognised by many researchers and professionals as one of the most reliable method to support multi-criteria decisions on different fields.

I have to say that the participation was very positive:

UK 32%
Portugal 44%
Netherlands 6%
Ireland 6%
France 3%
Canada 3%
Spain 6%

in terms of results the first approach lead me to the following ranking:

Gross Rental Yield: 20,19%

Potential landlords and tenants problems 16,20%

Risk of direct investment:13,55%

Capital gains tax: 11,29%

Income tax: 10,72%

Round trip transaction costs: 10,31%

GDP growth: 9,33%

Global Competitive index: 8,41%

Which is more or less what I was expecting.

Despite these results being intuitively correct , the level of consistency in the pair-wise comparison was not within the levels recommended by the AHP methodology.

At this stage you are probably asking "what is" or "how do you measure inconsistency " ?

Well, the way it's measured is through an mathematical algorithm.
What inconsistency really is can be better explained with the following example from my paper

"Survey Consistency:

The Judgement consistency of all participants is of major importance, has it represents reasoning in the judgement process. The importance of our opinion consistency and how we measure the consistency of subjective judgement is better explained through the following example:

We prefer BANANAS to APPLES, meaning that BANANAS have a greater preference than APPLES, then B > A. But we also prefer APPLES to CHERRIES then A > C. As BANANAS are preferred to APPLES and APPLES are preferred to CHERRIES we should expect that BANANAS are preferred to CHERRIES, then B > C. This logical process is known as transitive property.

Every time someone follows the transitive property when judging which criteria is preferred to assess property investment risk the results of the survey are considered consistent."

This small step-back , which is part of the learning curve of course, as lead me to create an elite group that, with my help over the phone if someone doesn't feel comfortable doing it on their own, will repeat the survey and evaluate at the end the results and the inconsistency levels.

The best part is that each person can review their contributions and their results and make the necessary adjustments to judgements to reduce the inconsistency level to 0.1 (10% )

I would be very honoured if I could have your participation in this elite group.
Its not the first time that someone from the RICS has used AHP to support valuation of special properties (when the market method is not applicable or even the DCF method can not be applied as well, I have one paper about that in case anyone is interested interested)

My case study is different and intends at a 1st phase to evaluate which criteria is more important to assess property investment risk in a buy-to-let decision when facing different investment options in different countries.

So when participating in the survey your role would be of a senior advisor to an investor that has different investment options in different countries , all in the residential sector, and all as buy-to-let. With this in mind the survey will appear to be more natural.

As I need to add individual emails to the expertchoice software (the calculator software that will alllow you see your resulst at the end and adjust judjments to reach a max of 0.1 on inconsistency ) I kindly ask to send me an email to

Lisboa@winkworth.pt

I trust you will find it interesting

I sent you an email as I am interested in learning more about the survey methodology plus we might have some overlapping RE interests.

(06-09-2012 11:39 AM)john_corey Wrote:  I sent you an email as I am interested in learning more about the survey methodology plus we might have some overlapping RE interests.

Hi John, thanks for your interest.

I will send you a summary of my paper after my presentation at the university

Kind regards

Paulo