Transcript Some Thoughts on National Spatial Data

BlomInfo A/S
Supporting the Development of Land
Markets
Richard Baldwin
BlomInfo A/S Denmark
BlomInfo A/S
CONTENTS
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Introduction
Real Estate Industry
Transition Experiences
Land / Real Estate Markets
Developing Land Markets - trends
Summary
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Introduction
• National Value of Real Estate can reach 50% of GDP
• Real Estate industry needs well developed Public
Sector Information infrastructure
– Public Sector geographic Information directly
generates 36 billion EUR in EU (1999) - 0.5-1% of
GDP as added value (more than 50% of all PSI)
– European Governments invest 4 - 5 billion EUR
annually in Public Sector Geographic Information
– US market is estimated as 500% larger
– companies such as ESRI claim annual growth
rates in excess of 20%
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Land Market Study - Real Estate
Industry and Transaction costs
• Private Sector
– Real Estate Agents
95%
– Valuers
– Mortgage Brokers
– Banks and Mortgage Providers
– Lawyers
– Cadastral Surveyors
– Information Services and IT
5%
• Public Sector
– Cadastre and Land Registry
– Physical Planning/ urban & rural management
– Local authorities
– Finance - Taxation - national savings
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Real Estate Industry - Capacity
• UK Land Registry
– average 7-10% market turnover ( 1.3 million
transfers annually)
– 3.4 million transactions
– 10 million searches and copies
– 80%+ of transfers financed by mortgages
– mortgages often up to 95% transaction price
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A. Transition Experiences -- 1991
position
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land registry records not kept up to date
cadastral maps reflect use, not ownership
mass privatisaton of apartments
restitution and compensation programmes
no use of market value
no financing mechanisms
• eg Hungary, Czech Republic
functioning land registration recognised as
essential to establishment of market economy
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B. TRANSITION AWARENESS - 1996 +
Change is the awareness of land markets
and their importance
– clear definition and sound administration of
property rights
– minimum set of restrictions on property rights
consistent with the public good
– simple and inexpensive transfer
– transparency in all matters
– availability of capital and credit
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B. Awareness of importance of Land /
Real Estate Markets
• Hernando de Soto
– secure real estate underpins market economy
– provides basis for credit and hence self help
– 25 rich nations all have secure property rights
and stable financing mechanisms
– where significant property/land market barriers
exist then economies are weak.
• Conclusions
– efficient land administration and real estate
markets create sustainable development
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B. Land / Real Estate markets
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B. Land Market Development
PERFORMANCE
INDICATOR
MARKET ECONOMY (EU)
100%
80
60
40
20
Market
Activity
0
0
1
COMMAND ECONOMY
2
3
4
5
LAND MARKET INDICATOR
Effectiveness of reforms
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B. Land Market Development (1998)
PERFORMANCE
INDICATOR
MARKET ECONOMY (EU)
100%
C
Driven by Harmonisation
80
60
B
Driven by Market
40
20
Driven by Market
Driven by Reforms
A
0
1
COMMAND ECONOMY
2
3
4
5
LAND MARKET INDICATOR
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B. Awareness of Importance of land
markets
• Complete transition process
– complete inventories, registers, legislation,
compensation, claims, appeals mechanisms
– regularise land records, ie remove transition
related problems
– Ensure that any existing pre-socialist land
records are available and accessible for
consultation
– make optimum use of private sector resources
– Clarify the legal basis of land ownership
– provide training in valuation
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C. POST TRANSITION AWARENESS - 2000 +
Focus on improving efficiency, quality and
delivery of land information services
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e- administration
use and re-use of public data
cost recovery and sustainability
service delivery mechansms
value added services
“unification / one stop shop ” concept
marketing and user needs
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Benchmarking
TABLE 12 FEE RATES
(assume 100,000' eur
value of object for
comparison purposes)
Austria
Netherlands
(unified
system)
FREE
Denmark
Slovenia
Serbia REC
(unified
system)
2.73 eur
FREE
FREE
8 eur
5.5
3.3 eur
3.9 eur (270 din)
13 eur
See 18.4
and 18.5
8.3 eur
2.2 eur (160 din)
12.4 Register title
1000
63
200
82.6 eur
12.5 Register mortgage
1100
90 (2)
600
41.3 eur
47.7 (3285 din)
av
79.5 (5475 din)
Land Registry Fee rates
12.1. Browse (view) land
register – one entry
12.2. Official Landbook
extract (per property)
12.3 submit application to
land registry
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Benchmarking
TABLE 12 FEE RATES
(assume 100,000eur
value of object for
comparison purposes)
Cadastre Fee rates
6 subdivision
7 area transfer (change
area of a parcel)
8 amalgamation of parcels
9 record boundary change
of a parcel
10 print official cadastral
extract
Austria
Netherlands
(unified
system)
Denmark
Slovenia
Serbia REC
(unified
system)
53.3 eur
0
370 (1)
0
194.5
145.9
19 (av)
19 (max)
36 (2474 din)
36 (2474 din)
53.3
13
0
0
97.3
97.3
19 (max)
19 (max)
42.1 (2900 din)
42.1 (2900 din)
7.26
5.5
4 (average)
14.5 eur (1000
din)
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Benchmarking
Table 13.
Transaction Costs
for real estate (Eur)
Austria
Netherlands
Investment
250,000
250,000
Denmark
Slovenia
Serbia
250000
250,000
• .
250,000
Comparative Indicators-Transaction costs
Duty percent
8,750(3,5%)
5,000 (2%)
12,500(5%)
Fees to LR and cadastre
5,250(2,1%)
153 (0.1%)
400 (0.2%)
130 (0.1%)
200-400(0.15%)
Fees to Notary /Lawyer
3,400(1,3%)
2,124 (0.8%)
2,000 (0.8%)
695 (0.3%)
(included with
estate Agent)
Fees to Bank
625(0.25%)
625(0.25%)
700(0.3%)
1250 (0.5%)
2,500 (1%)
Other Fees
500(0,2%)
1,000 (0.4%)
750 (0,3%)
300 (0.2%)
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Fees to Real Estate
Agent
7,500 (3%)
7,500 (3%)
11,250(4,5%)
7,500 (3.0%)
7,500 (3%)
Total costs
As % of transaction
As % of transaction
26,050
10.4%
7.4%
20,350
8.1%
6.0%
14.875
5.8%
4.0%
22,900
9.2%
4.2%
except Duty
15,000 (6%)
26,410
10.6%
4.6%
5250 (2.1%)
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Trends in Land Administration - -Benchmarking
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The beneficiary increasingly bears a larger part of
the cost
The fees charged for both land registry and
cadastral services are increasingly related to the
cost of service provision.
There is a move to provide greater freedom to the
land administration agencies
There is increasing technical integration of
databases
There is great variety in the licencing and costing
policies for geo-information products
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Institutional position
In de p e n d e nt
Trends and Examples
NGO
Re g ula te d
P riv a te
C o m p a nie s
P riv a te / public
pa rt ne rs hips
t io
lu
ev
o
D
St a te o wne d
c o m p a nie s
Ex e cut iv e
Age nc ie s
P riv a te / public
Co n t ra c ts
D e pa rt m e nta l
A uto no m o us
Age nc ie s
O ut sou rcing
G o v e rn m e nt
D e pa rt m e nts
D e pa rt m e nta l
de pe nde nt
a ge nc ie s
CRS Project
C ont rol le d by
g ov e rn m e nt
C a pa bili t y f or
co m m ercia lis at ion
Private
n
Re g ula te d
m o no po lie s
Sector
Government
Sector
Co m m unity
e nte r prise s
L o ca l
go v e r n m e nts
P riv a te
C o m p a nie s
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UK NLIS
HER MA J ESTY' S
LA ND R EG ISTRY
ORDN AN C E
SUR VEY
R EG ISTE RS
OF SCOTLA ND
D EPAR TMEN T OF
THE ENVI R ON MEN T
LOCAL
AUTHORI TY
LOCAL
AUTHORI TY
LOCAL
AUTHORI TY
LOCAL
AUTHORI TY
VA LUA TION
OFFICE
HUB
ELEC TRI C
GAS
TELEPHON E
WATER
SOCI O-EC ON OMIC
D ATAB ASE S
PR IVATE SEC TOR
D ATAB ASE S
C entres for publi c/pri vate sector access to N LI S
e.g. through the W orl d W id e Web
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STAKEHOLDER
FORUM
•standards
•pricing
•policy
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“Service First - the new charter programme UK
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Set standards of service
be open and provide full information
consult and involve
encourage access and promotion of choice
treat all fairly
put things right when they go wrong
use resources effectively
innovate and improve
work with other providers
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SUMMARY
WORLD BANK DEVELOPMENT
REPORT 2005
Focus on delivering basics
Government should focus on improving basic
foundations of a good investment climate
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Summary
World Bank Development Report 2005
• secure property rights are central
• “In Poland, Romania, Russia, Slovakia, Ukraine,the
firms that believe their property rights are secure
reinvest 14-40% more of their profits”
• verify rights to land and property, improve contract
enforcement, restrain expropriation, reduce crime
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SUMMARY
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1990-1994 3 land projects 0.1 Billion USD
1995 - 1999 19 land projects 0.7 Billion USD
1999 +
25 land projects 1.0 Billion USD
new projects (2004)
Ukraine
Macedonia
Serbia
The story is not finished...
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Developing Effective Strategies
(adapted from Drucker, 2004)
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What needs to be done ?
What is right for the enterprise ?
Effective Planning
Decision making
Communications
Focus on solutions not problems
productive meetings
Group orientation and values sector == better value
for society