Ian D Uttley BAHons MBA

1987 – 2018 Ian Uttley 31 years of management consultancy
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Ian Uttley retirement

Oct29
by admin on October 29, 2018 at 3:54 pm
Posted In: Uncategorized

On 31st August 2018 Ian Uttley has retired from his work as a management consultant for club work.

Britain can’t cope with a fall in house prices – here’s why

Oct13
by admin on October 13, 2017 at 12:46 pm
Posted In: Business News and Opinions

Good article from The Conversation

Britain is locked in a seemingly constant battle with the burden of its overheated housing market. Theresa May has announced measures at the Conservative Party conference designed, at the very least, to dampen criticism over a lack of housing and ever-increasing prices.

It is unclear for now just what impact May’s announcement for land releases and an extra £2bn for affordable housing may have. After all, the UK’s housing stock is valued at close to £7 trillion. But her announcement comes after London real estate prices registered their biggest fall in a decade, stoking expectations for further drops in real estate prices.

But what would falling house prices mean for Britain? How might it affect employment, household consumption, investment, the Government deficit and, critically, the UK current account – the net measure of cash flows in and out of the economy.

 

The greater fool

Brexit and associated uncertainty about the future of the UK financial sector are making real estate investors, home buyers and households more cautious. One of the things that has fuelled London real-estate prices over the years is the “greater fool” mechanism. Buyers knew that a property was expensive, and perhaps ridiculously expensive, but they counted on the fact that they could sell it later to a “greater fool” at an even higher price, for a handsome profit.

That phenomenon was perhaps best displayed in the first recorded crisis in free markets. Tulip mania in 17th century Holland built to a crescendo which saw single, rare tulip bulbs change hands for extraordinary sums. Historian Mike Dash has described it as enough to “purchase one of the grandest homes on the most fashionable canal in Amsterdam for cash, complete with a coach house and an 80 foot garden”.

As tulip mania went on to show, however, if prices show indications of a fall, the upward trend reverses violently. If property investors become skittish, they will try to sell before prices fall further, and all of them at the same time. Property values built over decades could collapse within months: the expectation of falling prices causes the falling prices.

This mechanism is a real danger in London which relies heavily on local and international investors who view properties not as a home but as a commodity, readily sold to maximise profit. In 2013 alone, international investors accounted for 82 per cent of London property activity.

Falling for it

However, most properties in the UK still belong to households. Families, by and large, don’t need to sell. So what would falling property prices mean for them?

First, many pension funds and investment bonds rely on UK property to generate income for their beneficiaries. Second, we have what economists call the wealth effect.

House prices rise at fastest pace in eight months

Economists have long associated consumers’ perceived real estate wealth with spending behaviour: if you believe your house is worth a lot, you feel financially secure. And then you allow yourself to save less and spend more. Just consider the rising number of people who plan to subsidise their retirement with wealth generated by their homes.

If their assumed valuations start to look shaky, these people will spend less to build up their savings. The pain would be felt by many: about 64 per cent of households in England are owner-occupiers.

The wealth effect is important in most developed economies but even more so in the UK which relies on ever-rising levels of consumer spending for its growth. A 10 per cent fall in the value of dwellings in the UK would correspond to a loss of wealth equivalent to more than the value of all the cars exported from the UK in a decade.

Ripple effects

The climate of economic uncertainty, reduced consumption and falling real estate values brings an additional problem for the UK. Britain has long had a trade deficit, but it has also benefited from positive foreign direct investment.

The current account itself has been in the red for nearly 20 years now but the hundreds of billions of inward foreign investment channelled to UK property over the same period meant that this deficit remained manageable – just about.

According to the Bank of England, overseas companies have accounted for roughly half of all UK commercial real estate transactions since 2013. If international investors expect prices to fall in any sustained way, the inflow of money would stop and many would sell up. Why buy or hold an asset just at the start of what might be a long decline?

This would not only put pressure on real estate prices but would affect UK GDP, reduce government revenues and worsen the UK current account position. The credit rating of the UK would come under more pressure, and trillions of UK government debt would cost more to refinance. Then the UK government deficit would deteriorate further, taxes might rise to cover for this and the domino effect would be in full cry, spreading to all sectors of the economy, similar to events in Greece.

Policy plays

Real estate values are critical to the UK’s prosperity. Households, pension funds and businesses have invested heavily; most of the country has, in one way or another, skin in this game. Britain may need to wean itself of its property addiction, but it also needs to sustain confidence in the single asset class that counts for almost two thirds of its wealth.

Schemes like Help To Buy might soon trigger a recession

It is deeply difficult politically to sell that story, however, when the understandable clamour is to make housing more affordable. In a move designed to win over younger voters, May has imposed punitive taxation on landlords, cutting one of the life-lines of UK real estate and driving many out of the market. The new measures announced at the Conservative party conference apply further pressure.

May is desperate for a positive message but the implications of targeting the real estate market right now are huge. Britain’s Brexit fumbling is already failing to inspire confidence. The fear has always been that Brexit would spark a period of stagnation, but the danger of deeper, more accelerated damage now seems real, and the potential effect on property values and the economy stark.

The UK government should act decisively. This would require the continuation of loose monetary policy, a reinstatement of tax incentives for real estate investment and, of course, a real plan for Brexit and the future of London’s financial services industry.

Alexander Tziamalis is a senior lecturer (associate professor) in economics and a consultant at Sheffield Hallam University. This piece originally appeared on the Conversation

↓ Read the rest of this entry…

└ Tags: Ryburn Management, Ryburn Management Consultants

Over 50 now is the time to keep your mind sharp with a little exerecise

Apr30
by admin on April 30, 2017 at 8:28 pm
Posted In: Ryburn Consultancy, Training and Nutrition

“Doing moderate exercise several times a week is the best way to keep the mind sharp if you’re over 50,” BBC News reports. ↓ Read the rest of this entry…

└ Tags: Ian Uttley, Ryburn Fitness, Ryburn Management Consultants

Bank of England forecast to hold interest rates amid Brexit uncertainty

Mar10
by admin on March 10, 2017 at 1:34 pm
Posted In: Business News and Opinions, Ryburn Consultancy

Press Association 10th March 2017

The Bank of England is set to keep interest rates firmly on hold next week as policymakers remain in wait and see mode as Britain prepares for divorce with the EU. ↓ Read the rest of this entry…

└ Tags: Ian Uttley, Ryburn Fitness, Ryburn Management

Maybe we will not leave the EU Morgan Stanley have a look

Jul22
by admin on July 22, 2016 at 1:11 pm
Posted In: Business News and Opinions, Management Development, Ryburn Consultancy

Leaving the EU is so difficult, and the consequences are so economically damaging, that it may be easier for prime minister Theresa May’s government to endlessly delay the process rather than to actually leave. ↓ Read the rest of this entry…

└ Tags: Ian Uttley, Ryburn, Ryburn Fitness, Ryburn Management, Ryburn Management Consultants, silatec.com

Italy’s wrangle with Europe will dwarf Brexit shock – the country that could bring it all crashing down.

Jul17
by admin on July 17, 2016 at 6:32 pm
Posted In: Business News and Opinions, Ryburn Consultancy

If you think Britain’s banks are in bad shape, spare a thought for the Italians, where the country’s battered lenders are rapidly crumbling under an astonishing €360bn (£300bn) of bad loans.  per Daily Telegraph ↓ Read the rest of this entry…

└ Tags: Ian Uttley, Ryburn Fitness, Ryburn Management

Pump that iron: The 10 reasons why lifting weights can help you burn fat, quit smoking and even help cancer recovery

Jul17
by admin on July 17, 2016 at 6:26 pm
Posted In: Ryburn Consultancy, Training and Nutrition
Bone health declines with age, but weight lifting can help stem the decline and even reverse it

1. You lose more fat

All exercise burns calories, but lifting weights has been found to be more effective in burning body fat.

A US study comparing weight training and aerobic exercise found that participants who did both weight lifting and cardiovascular training lost 40 per cent more fat. ↓ Read the rest of this entry…

└ Tags: Ian Uttley, Ryburn Fitness, Ryburn Management

Ten biggest changes to personal finances in 2016

Jan03
by admin on January 3, 2016 at 11:59 am
Posted In: Business News and Opinions, Management Development, Ryburn Consultancy

pensions_2747863-x_3534929b
You would be forgiven for thinking that 2015, which saw the introduction of both pensions freedom and much improved “super-Isas”, counted as a year of dramatic change in the world of personal finance.
But welcome to 2016: in this momentous year our state pension system will be overhauled, savings and dividends will be taxed under a new regime and millions of us will be given personal tax accounts operated wholly online and updated constantly.  By Richard Dyson  The Telegraph ↓ Read the rest of this entry…

└ Tags: Ian Uttley, Ryburn, Ryburn Management Consultants
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