Housing Demand and supply

1. Housing Demand and supply.
Factorsaffecting thedemandandsupplyof housing

2. 1. Affordability.Risingincomesmeanthatpeople are able toaffordtospendmore on housing.
Duringperiodsof economicgrowth,demandforhousestendstorise. Also,demandfor
housingtendstobe a luxurygood.Soa rise inincome causesa bigger% rise in demand.
2. InterestRates
Interestratesplaya bigfactor indeterminingthe costof mortgage interestrepayments.
3. Population
The demandfor housingdoesn’tjustdependonthe populationbutalsothe average size of a
household.Certainsocial anddemographicfactorsare causinga rise in the numberof
households(fasterthanthe populationincrease).These demographic changesinclude issues
such as: age of people leavinghome
 Increasedlife expectancy,leadingtomore single oldpeople
4. Mortgage availability
Anotherfactorthat determinesthe effective demandforhousesisthe willingnessof banks
to lendmortgages.
5. Economic growth and real incomes.
Risingincomesenablepeople toaffordbiggermortgagesandencouragesdemandfor
housing.
6. Economic growth and real incomes.
Risingincomesenablepeople toaffordbiggermortgagesandencouragesdemandfor
housing.