9 Economic Concepts That You Should Know Before Working With Any Architectural Firm

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9 Economic Concepts That You Should Know Before Working With Any Architectural Firm

Š Shah & Talati | All Rights Reserved.


A project is defined by its sustainability, livability, and land use, but people often avoid the profitability, capital gains, and externalities that go along with them simply because they don’t know how to use the terms. Baroda is the cultural capital of Gujarat, one of the most progressive states in India. Architecture acts as the mediator between different works being carried out in a project in this heritage city. This article will help you easily understand some basic economic concepts that can help you work with any architectural firm in Baroda. 1. Real Estate Real estate properties are fixed in their position. Land, buildings, farms or other types of constructions are included in the real estate. 2. Community Space This is a property whose enjoyment is not limited to an individual. Examples are parks and public spaces. 3. Housing Bubble A housing bubble is an excessive and unjustified increase in real estate value. This increase is usually caused by speculation. 4. Opportunity Cost It is the maximum profit that could have been obtained from investing in other options apart from what you invested! Š Shah & Talati | All Rights Reserved.


5. Economic Cycle The expansion and contraction stages in economic activity experienced by industry are known as the economic cycle. It is a fact that occurs at certain periods of time. 6. Mortgage Loan A mortgage loan is a loan in which the payment of interest and principal is guaranteed by the property registration. 7. Commodities Primary goods that are traded internationally are known as commodities. For example grains, metals, energy products, coffee, cotton, etc. Construction largely depends on these goods and a rise in the price of these products will affect the price of a project directly. 8. Savings and Loan Corporations These are financial institutions whose functions are to promote private savings and helps to drive the construction industry through mortgage loans. 9. Externality Any benefit or social cost that arises as a result of a private activity for parties not included in a particular activity. A negative externality can be traffic that is produced by a building with a lot of parking. Š Shah & Talati | All Rights Reserved.


A positive externality can be, for example, the increase in tourism generated by the construction of the Statue of Unity near the Sardar Sarovar Dam. Shah and Talati believes every activity in every phase of the construction process has a time and cost implication on the entire project. Hence, knowing the basic terms before working on the project is essential. Bearing this in mind, they are the best architectural firms in Baroda.

Š Shah & Talati | All Rights Reserved.


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