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Thesis (Ph. D.)--University of Alberta, 2000. / Includes bibliographical references (leaves 160-179).

This thesis has the intention to investigate the risk situation for small investors in the domestic residential property market in Sweden, and discuss some alternatives for reducing that risk. Focus will be on risk reduction by diversification. Residential property is considered to be a rather safe investment for the long term investor. The return is determined by the change of value for the property (capital growth), and the direct return through net rental income. When investments in residential property are compared with other types of investments, they have high returns compared to their stan-dard deviation. Diversification gains are described in the frame of the Capital Assets Pricing Model (CAPM). The CAPM shows that portfolios based on residential property can reduce their risk and maintain the same level of returns through diversification. To get the best effect out of this diversification this should be done with assets that are least correlated with residential property. This thesis has tested with other residential property, other real estate and equities/bonds. Of which equities/bonds gave the best results. An optimal portfolio based on historical data from 1984 – 2003 suggests a portfolio with 40 -60 % residential property, 30 – 60 % bonds and 0 – 10 % equities. This is with a risk free rate between 3 – 11 %. The debt ratio for this portfolio is determined by the investor’s risk-aversity and utility function. The positive effects from diversification have to be compared to the increased scale effect from investing in more residential property when chosing new investment items. Investors can get a good diversification performance even with a few stakes. The main point in this thesis is that investors with residential property can get positive effects from diversification and the effects from diversification increase the more different the investments are.

<p>This thesis has the intention to investigate the risk situation for small investors in the domestic residential property market in Sweden, and discuss some alternatives for reducing that risk. Focus will be on risk reduction by diversification.</p><p>Residential property is considered to be a rather safe investment for the long term investor. The return is determined by the change of value for the property (capital growth), and the direct return through net rental income. When investments in residential property are compared with other types of investments, they have high returns compared to their stan-dard deviation. Diversification gains are described in the frame of the Capital Assets Pricing Model (CAPM).</p><p>The CAPM shows that portfolios based on residential property can reduce their risk and maintain the same level of returns through diversification. To get the best effect out of this diversification this should be done with assets that are least correlated with residential property. This thesis has tested with other residential property, other real estate and equities/bonds. Of which equities/bonds gave the best results. An optimal portfolio based on historical data from 1984 – 2003 suggests a portfolio with 40 -60 % residential property, 30 – 60 % bonds and 0 – 10 % equities. This is with a risk free rate between 3 – 11 %. The debt ratio for this portfolio is determined by the investor’s risk-aversity and utility function.</p><p>The positive effects from diversification have to be compared to the increased scale effect from investing in more residential property when chosing new investment items. Investors can get a good diversification performance even with a few stakes. The main point in this thesis is that investors with residential property can get positive effects from diversification and the effects from diversification increase the more different the investments are.</p>

This thesis presents a comprehensive view on the commercial properties market in the Czech Republic and its development in time both before the economic crisis and after its beginning. Author tracks both major segments of commercial properties market -- offices and industrial & logistic properties from the rental as well as investment point of view. The target of the thesis is to characterize commercial properties market, its major actors and branches and to point out the most important differences in impact of the crisis on the two major market segments. The author uses relevant public data as well as own experience based on more than 4 year track record on real estate market. Based on attainable data and own experience, the author predicts also future market development.