Transcript Javier Mustieles 26th June 1. 2. 3. 4. 5. 6. 7. 8. Introduction and background Aim, objectives and scope Literature review Methodology Data collection and analysis Discussion of results Conclusions Citations and referencing Investing money in a construction.

Javier Mustieles
26th June
1.
2.
3.
4.
5.
6.
7.
8.
Introduction and background
Aim, objectives and scope
Literature review
Methodology
Data collection and analysis
Discussion of results
Conclusions
Citations and referencing
Investing money in a construction is risky
To avoid risks, it
is essential :
• Predict the profit
• Reduce costs
1.
2.
3.
4.
5.
6.
7.
8.
Introduction and Background
Aim, objectives and scope
Literature review
Methodology
Data collection and analysis
Discussion of results
Conclusions
Citations and referencing
• OBJECTIVE 1
Where and when is the right
moment to invest
• OBJECTIVE 2
The effect of the world economy
in the construction sector
• OBJECTIVE 3
The cheapest or most expensive
country for building
• OBJECTIVE 4
The most profitable country to
build in.
1.
2.
3.
4.
5.
6.
7.
8.
Introduction and Background
Aim, objectives and scope
Literature review
Methodology
Data collection and analysis
Discussion of results
Conclusions
Citations and referencing
SIMILAR STUDIES:
“Turner & Townsend”
Gardiner&Theobald”
They talk about…
 Materials costs
 Key trades costs
 Labour costs
-PREDICT PROFIT
-REDUCE COSTS
1.
2.
3.
4.
5.
6.
7.
8.
Introduction and Background
Aim, objectives and scope
Literature review
Methodology
Data collection and analysis
Discussion of results
Conclusions
Citations and referencing
Procedure for the study of costs:
• Selection of countries for the analysis
• Development of the study:
 Analysis of the economy of the country
 Analysis of the housing market
 Simulation
1.
2.
3.
4.
5.
6.
7.
8.
Introduction and Background
Aim, objectives and scope
Literature review
Methodology
Data collection and analysis
Discussion of results
Conclusions
Citations and referencing
Criteria of selection
1) Developed
country
coming out of
recession
Different economic
situations
2) Emergent
country
3) Developed
country in
recession
The factor that has
the most influence
on construction
costs
2 levels of
economy
The economy
of the country
MICRO-ECONOMY
MACRO-ECONOMY
MICRO
MACRO
• BANK INTEREST RATIO
• UNEMPLOYMENT RATIO
• COST OF KEY MATERIALS
(STEEL,CONCRETE…)
• GDP INDEX
• COST OF KEY TRADES
• PERCENTAGE OF
CONSTRUCTION IN GDP
• LABOURCOST
• INFLACTION
• PRICE M2 OF HOUSE
• STOCK OF HOUSES
• WAGES INDEX
YEARS
US
MALAYSIA
SPAIN
2008
5,8
3,4
10,46
2009
9,3
3,6
17,73
2010
9,62
3,1
19,97
2011
9
2,8
21,23
25
20
U.S.A
15
Malaysia
10
Spain
5
0
2008
2009
2010
2011
YEARS
U.S.A
MALAYSIA
SPAIN
2008
-0,4
4,8
0,9
2009
-3,5
-1,5
-3,7
2010
3
7,2
-0,3
2011
1,7
5,1
0,4
20
15
U.S.A
10
Spain
5
Malaysia
0
2008
-5
2009
2010
2011
YEARS
U.S.A
MALAYSIA
SPAIN
2008
4,3
4,4
10,6
2009
3,8
6,2
10,4
2010
3,4
11,4
10,1
2011
3,3
4,7
9,3
12
10
8
U.S.A
6
Malaysia
4
Spain
2
0
2008
2009
2010
2011
YEARS
U.S.A
MALAYSIA
SPAIN
2008
-1,18
2,50
-1,03
2009
1,85
-1,40
-4,48
2010
2,00
9,77
-6,09
2011
0,94
17,53
-8,18
25
20
15
USA
10
Malaysia
5
Spain
0
-5
-10
2007
2008
2009
2010
2011
USA
MALAYSIA
SPAIN
• Unemployment
• Unemployment
• Unemployment
• GDP
• GDP
• GDP
• % of construction
…in GDP
• % of construction
…in GDP
• % of construction
…in GDP
• Wages index
• Wages index
• Wages index
• To know and
...understand the
...demand of houses
STOCK DWELLINGS
• To know the profit
…can be obtained
PRICE OF DWELLINGS
In chosen countries
- USA
- Malaysia
QUANTITY IN
THOUSANDS
Quantify of houses
Occupied houses
Empty houses
2008
2009
130.840
111.854
18.986
130.587
111.711
18.876
2010
2011
2012
130.845 132.474 132.961
112.451 114.086 115.033
18.394 18.388 17.928
% Dwellings occupied
empty houses
87
19500
86.5
19000
86
18500
empty
% occupied
houses
85.5
18000
85
17500
84.5
17000
2008
2008
2009
2009
2010
2010
2011
2011
2012
2012
HOUSE PRICE INDEX
0
-2
2007
2008
2009
2010
2011
2012
-4
-6
HOUSE PRICE
%
-8
INDEX
-10
-12
-14
-16
-18
12%
(QUANTITY IN s.m)
2008
2009
2010
2011
2012
TOTAL SPACE
9,786,603
10,072,809
10,660,796
11,263,069
12,071,195
SPACE OCCUPIED
7,957,754
8,242,864
8,597,424
8,954,344
9,553,526
OCCUPANCY RATIO
81,3
81,8
80,6
79,5
79.1
OCCUPANCY
TOTAL SPACE
RATIO
12800000
83
82
12000000
81
11200000
OCCUPANCY
TOTAL
RATIO
SPACE
80
10400000
79
9600000
78
8800000
77
2008
2008
2009
2009
20102010
2011 2011
2012 2012
HOUSES PRICE INDEX
25
20
15
HOUSES
10
PRICE
5
0
2007
2008
2009
2010
2011
2012
17%
1.
2.
3.
4.
5.
6.
7.
8.
Introduction and Background
Aim, objectives and scope
Literature review
Methodology
Data collection and analysis
Discussion of results
Conclusions
Citations and referencing
To carry out the simulation three steps are followed:
Obtain information
about:
• Costs of key
materials
• Trades,
• Labour
preliminary costs
• Interest rates
Create a
house
model
Find out the
price of that
house in the
real market
The information is based on:
Examples:
• Websites
• Similar studies of this field
• “Turner & Townsend”
• “David Langdon KPK”

Concrete detached house – 200m2 built.
REQUERIMENTS OF THE HOUSE:
• SAME TYPE / SAME NUMBER OF FLOORS.
• SAME QUALITIES.
• SAME SURFACE.
• BUILT IN THE YEARS 2011-2012.
• SEARCH IN DIFFERENTS LOCATIONS / STATES / REGIONS.
• GET A BIG NUMBER OF THEM.
Profit 2008
contractor margin
2009 per m22010
14.00
Total cost
2011
300.317,03 287.068,47 286.043,59 294.363,74
12.00
Cost m2
1.501,59
1.435,34
1.430,22
1.471,82
Price house
1.682,94
1.648,27
1.577,72
Profit
1.537,96
10.00
%
8.00
6.00
contractor
margin per
m2
4.00
2.00
Profit contractor
margin per m2
0.00
2008
181,35
10,78%
2009
212,93
147,50
66,14
12,92%
2011
9,35%
4,30%
2010
Profit constructor
margin
2008
2009per m2 2010
33.00
Total cost
2011
146.462,63 143.228,74 150.536,44 157.100,57
32.00
cost/m2
732,31
716,14
752,68
Price house
972,02
1.024,60
1.105,86
31.00
30.00
29.00
28.00
785,50
Profit
constructor
1.150,31
margin per
m2
27.00
26.00
Profit constructor
margin 2008
per m2
25.00
239,71
24,66%
2009
308,46
30,11%
2010
353,17
364,81
31,94%
31,71%
2011
1.
2.
3.
4.
5.
6.
7.
8.
Introduction and Background
Aim, objectives and scope
Literature review
Methodology
Data collection and analysis
Discussion of results
Conclusions
Citations and referencing
THE MOST
PROFITABLE
PLACE TO BUILD
INCOME OF THE
INVESTED MONEY
Due to
MALAYSIA
31%
 LOW COSTS
 HIGH PRICE OF THE DWELLINGS
THE PERCENTAGE OF EMPTY HOUSES IS INCREASING
THIS COULD PRODUCE:
OCCUPANCY RATIO
82.5
82
81.5
81
80.5
80
79.5
79
LOWER HOUSING DEMAND
LOWER HOUSING PRICES
OCCUPANCY
LOWER PROFIT INCOMES
RATIO
78.5
78
77.5
2008
2009
2010
2011
2012
USA PROFIT
15.00
10.00
Profit
%
contractor
margin
5.00
per m2
0.00
2008
2009
2010
2011
2012
2013
MALAYSIA PROFIT
33.00
31.00
Profit
29.00
constructor
margin per
27.00
m2
25.00
2008
2009
2010
2011
2012
2013
1.
2.
3.
4.
5.
6.
7.
8.
Introduction and Background
Aim, objectives and scope
Literature review
Methodology
Data collection and analysis
Discussion of results
Conclusions
Citations and referencing
Investing in US
Less risk
• The demand of houses maintains
• The price of dwellings does not recover
Investing in Malaysia
• Very high benefits
High profit
• Housing demand decrease
High risk
Less profit
1.
2.
3.
4.
5.
6.
7.
8.
Introduction and Background
Aim, objectives and scope
Literature review
Methodology
Data collection and analysis
Discussion of results
Conclusions
Citations and referencing
I could get information about the construction costs in
differents country from studies already done like:
INTERNATIONAL CONSTRUCTION COST SURVEY
by GARDINER & THEOBALD
www.gardiner.com/
INTERNATIONAL CONSTRUCTION COST SURVEY
by TURNER & TOWNSEND
www.turnerandtownsend.com/
www.bls.gov
www.tradingeconomics.com
www.epu.gov.my
www.governing.com
www.census.gov
www.payscale.com
United states departament of labour
Economic analysis enterprise
Malaysian government
Business news
Stadistic office united states
Information about labour cost
www.turnerandtownsend.com Information about international costs
www.tradingeconomics.com
Basic macro-economic data
Javier Mustieles
26th June