But there are many other countries that do not have an unswerving source of property pricing. Even US is yet to use derivatives wholeheartedly. Derivatives are used more openly in the European markets such as Germany and France. Generally trading is done o the overall IPD index but investors such as Prudential’s property funds have started to trade derivatives based on development of certain sector within property such as retail and London Offices. These properties can also be used for derivative trading.

This step will help more people to invest. Even if shares of one sector falls the other sector can act as a back up depending on that sector’s potential. There is a lot of prospective by using derivatives. Commercial property owners can lock income returns and evade capital values if they fear a fall in prices. The residential derivative market is not very often traded and in the last quarter of 2009 residential derivative contracts were traded against Halifax House Price Index for an estimated £150 m.