Impacts on Midland Realtys Real Estate Business

Transportation is considered a necessity by a lot of people. From the experience of transit schemes shows that it can play a significant role in improving the attractiveness and quality of urban public transport. It would help to increase the value of nearby real estate. Although the value of real estate increase, how would Midland Realty makes use of this opportunity to capitalize the sale. The revenue of Midland Realty is mainly base on the transaction of real estate. Service which provides by Midland Realty is the main factor. So, it is crucial to examine critically the impact of on Midland Realty's Real Estate Business After The Extension of Kowloon Southern Link to Hunghom in 2009. The aim of the research is to find out that the impacts on Midland Realty's real estate business after the extension of Kowloon Southern Link to Hunghom. How Midland Realty can make use of this opportunity to increase the sale. This study will base on the following objectives to examine the result. The first objective is to examine the awareness and attitudes of potential buyers towards the demand of real estate along Kwoloon Southern Link stations. This is a very important factor which would affect the result of this research. The second objective is to investigate Midland Realty has spend enough resources on real estate business. Any internal factors will related or effect to the sale of Midland Realty? Also, this paper base on questionnaire with face to face interview or telephone and around 100 potential buyers or buyers of the real estate along the Kowloon Southern Link station will be asked, in order to investigate the impacts on Midland Realty's real estate business after the extension of Kowloon Southern Link to Hunghom in 2009. In the project, it would show the value of real estate among the West Rail Line and the buying behavior of the potential buyers. Also, I would like to use the information to show how Midland Realty capitalizes on the extension of the West Rail Line. Moreover, I would like to conduct a survey on the potential buyers. Then make use of the data and relevant information to analysis and find out the strategy on West Rail Line is successful or not.

iii. Aim

This works aims to provide suggestions and evidences of how Midland Realty capitalizes on the extension of West Rail Line to Hunghom in 2009. And how can attract more potential buyers to buy real estates through Midland Realty in order to increase the sales and profits.

2. Background

Midland Holdings was founded in 1973 by Chairman Wong Kin-yip. For the past few years, it has dedicated itself to providing real estate broking service for all property sectors – from residential to commercial and industrial. On June 8, 1995, Midland Holdings became the first and the largest real estate agency to go public in Hong Kong. Moreover, Midland Holdings acquired Hong Kong Property Services (Agency) Limited to expand its market share. After years of growth and expansion, Midland Holdings now has more than 300 branches, employing over 5,000 persons. Its standing in the market is solid, to say the least. They have been operating for years on one guiding principle : 'Customers come first”?. They work like as : “Think customers; be responsive; take initiative; be innovative; work as a team and scale new heights.”? Employees are guided to offer 3Ps service – Prompt, Precise and Professional, to customers. Furthermore, Midland Realty is one of the Midland subsidiaries of Midland Holdings which is one of the Hong Kong real estate agency too. Its services including real estate transactions, real estate news, promotion of the new real estate, the property market analysis, maps online searching and transaction records. Midland Realty is very successful on anticipateing market trends which it had over 30 years of experience on real estate business. For example, it is succesfully catch up the opportunity on SARS effects in 2003. It made use of the chance on downturn on real estate maket and started preparing and planning strategies, waiting for the market boom up. As a result, it showed that Midland Holdings is able to be a lead of real estate agency. It had breakig a great number of records on that year. In 2009, the real estate market is keep growing. The value of real estate is increased very rapid. Especially the urban areas which with good established transportation. For example, Kowloon Tong, Mong Kok, Tsang Kwan O...etc. These facts can proved that the real estate with good established transportation would help to increase the land vule of the rea estate. In theriodically, the value of real estate which along Kowloon Southern Link would be increse too. Good established transportation would attract people willing to move into the new town instead of the urban place. As they can have better living area with less transport time. Therefor, the demand on the real estate along the Kowloon Southern Link would be increse. Why well developed transportation would help the areas development? Although Hong Kong is a small place, people still spend lot of time on traveling due to inconvenience transportation services in coutryside – Yuen Long or Tuen Mun. In the past, people need to take around 44 minutes from Yuen Long to East Tsim Sha Tsui and take around 55 miniutes from Tuen Mun to East Tsim Sha Tsui. At now, it just take about 30 minutes to the heart of Kowloon with travel direct all the way on the West Rail Line to Jordan, Tsim Sha Tsui and Hunghom without an interchange taking a feeder service which provided by MTR.

3. Objectives and research questions

This study will base on the following objectives to examine the result. Aims to investigate the impacts on Midland Realty' real estate business, the sale would increase or not. How to make use of opportunity to increase the sale. As the income of Midland realty is the commission, increase the transaction of real estate, would increase the sales. The opportunity is the extension of Kowloon Southern Link to Hunghom. It is would be affect the demand on real estate which along the Kowloon Southern Link. But it is a small fact only, service which provide by Midland Realty is the main important fact to increase the sale. This report is main to find the relationship on the sale and the service.The first objective is to examine the awareness and attitudes of potential buyers towards the demand of real estate along Kwoloon Southern Link stations. This is a very important factor which would affect the result of this research. As the demand of real estate will directly related to the value of the real estate. Therefore, it will be a cause and effect relationship between Midland Realty and Real Estate. The second objective is to investigate Midland Realty has spend enough resources on real estate business. For example, did it open enough branches along the Kowloon Southern Link stations or not, hire enough agents to satisfy the effect on the sale, it can provide good services and quantity to their customers. These are the important factors which would affect the sale of Midland Realty. Also, this paper base on questionnaire with face to face interview or telephone and around 100 potential buyers or buyers of the real estate along the Kowloon Southern Link station will be asked, in order to investigate the impacts on Midland Realty's real estate business after the extension of Kowloon Southern Link to Hunghom in 2009. Below are the main points of the objectives questions of this research: Examine the potential buyer's personal information (Age, Income, Education level, etc) Examine the potential buyers have used Midland service or not? Examine the awareness and attitudes of potential buyers towards the demand of real estate along the West Rail Line stations Examine the channel of potential buyers in buying real estate (Centaline Property Agency Limited? Midland Realty? Ricacorp Properties? CENTURY 21 Hong Kong Limited? Other else?) Examine the reasons why they buy real estate through that company? Examine the relationships between factors (Efficiency, Agent's experience and knowledge, Expression skills, Property information and explanation, Product Knowledge, Customer Care, Pre-sale Service, After sale Service, etc) and the attitude of potential buyers towards Midland Realty. Examine the potential buyers will use Midland Realty service again in the near future? (Please specify) Any suggestion

4. Critical literature review

A critical review of this research, using 'The Impact of Rail Transport on Real Estate Prices: An Empirical Analysis of the Dutch Housing Market', 'The real-estate and transportation complex', 'Property Values and Transportation Facilities: Finding the Transportation-Land Use Connection', 'Effects of Transportation Infrastructure and Location on Residential Real Estate Values: Application of Spatial Autoregressive Techniques', 'Empirical Study on the Impact of Urban Rail Transit on House Price - Based on Hedonic Price Model', conducted a study on the impacts on the value of real estate along the Kowloon Southern Link Stations. This research aimed to provide further evidence on the relationship between transportation and real estate. These papers are very similar to this research objective. As they are already proved that the value of real estate and well development transportation has deeply relationship. New transportation would help the development on the areas. 'Proximity to transportation infrastructure (highways and public transit) influences residential real estate values.' It proves that they have relationship. The real estate which is very near to the transportation facilities would increase its value and people would trend to increase the demand on it. 'A hedonic pricing model is estimated to analyze the impact of railways on house prices in terms of distance to railway station, frequency of railway services and distance to the railway line.' (An Empirical Analysis, 2006) For a wide range of house value if it is very close to a transportation station are on average about 25% more expensive than at a distance of 15 kilometers or more. It leads to a nice increase of house values of about 2.5%, ranging from 3.5% for houses closed to the station to 1.3% for houses far away. The negative effect of distance to railways, probably due to noise effects. It may have small effect on the demand of the real estate along the Kowloon Southern Link. Because Hong Kong is a small place, everywhere are very valuable. Hong Kong would not considered that is a big problem and ignore it as well. 'Land rent is the reciprocal of transportation cost, and land rent can be viewed as capitalized transportation costs.' (The real-estate) 'Use travel distance as a measure of access to transportation facilities, results tend to show mixed property value effects.' (Finding) 'House price increases most rapidly in years of starting to build and operate, and decreased slightly in the mid-term of building,' (Based on Hedonic Price Model Theses are the important factors. 'Two railway station references were used in the analysis: the nearest and most frequently chosen station in the post code area. This distinction indicates that railway station accessibility is a more complex concept than one might think. It involves competition between railway stations.' (An Empirical Analysis, 2006) It would increase the price of real estate. 'A new interpretation of the transportation facility-property value literature that improves our ability to measure this relationship and to anticipate land-market responses to transportation facilities.' (Finding) However the results provided less clear relationships between transportation and real estate. To the extent that this research is exploratory, results of this study provide insights into the importance of recognizing the value of real estate would be affected by transportation. However several limitations must be considered in interpreting the study findings. In summary, it has to be admitted that the current study is still far from being conclusive. Further studies must be undertaken, better measures must be developed, and larger samples must be used to improve our understanding concerning the exact relationship between transportation and real estate. Despite some deficiencies in methodology, to the extent that this research is exploratory i.e. trying to investigate an emerging issue, the study has provided some insights to account for the difference of real estate between different West Rail Line stations.

5. Research Methodology

This research aims to find out how Midland Realty capitalize on the extension This works aims to provide suggestions and evidences of how Midland Realty capitalize on the extension of West Rail Line to Hunghom in 2009 and how can attract more potential buyers to buy real estates through Midland Realty, in order to increase its sales and profits. So, the target population is the potential buyers. This study will use communication approaches to collect data, such as self-administered survey, telephone survey and survey via personal interview. This study will mainly focus on personal interview because it is face-to-face interview. It can get inter-action with the interviewees and it includes interviewer-controlled environment and participant-controlled environment. These are used by prescheduled and intercept. Also, it would use phone interview because through the voice, it can get message from interviewees immediately. It will use Human-administered, CATI and computer-administered. Moreover, it would not use self-administered surveying such as using mail, intercept, computer and central location due to low response rates and no interviewer intervention. Although it is the lowest-cost method, the survey still cannot be too long and too complex. Therefore, it would use phone interview and personal interview to collect data due to insufficient fund. Sampling method will use approach of judgment sampling because it selects sample members to conform to certain criteria. For example, this studies the real estate business, so it interviews those potential buyers of real estate. The sample size would be 100 - 150 due to insufficient fund.

6. Project Plan

Here is a Gantt Chart showing the time table.

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