Real Estate Prices in England and Wales: Analysis of Trends and Factors

This assignment analyses the trends and factors affecting the real estate prices in England and Wales from 1999-2018. It covers the impact of macroeconomic and business factors, government policies, and financial planning on the real estate industry. The analysis includes a comparison of price movements in different regions of England and Wales.

Running head: BUSINESS MANAGEMENT AND STRATEGIC MANAGEMENT
Finance
Name of the Student:
Name of the University:
Author’s Note:

1BUSINESS MANAGEMENT AND STRATEGIC MANAGEMENT
Table of Contents
Part A...............................................................................................................................................2
Part B...............................................................................................................................................3
Part C...............................................................................................................................................4
References........................................................................................................................................6

2BUSINESS MANAGEMENT AND STRATEGIC MANAGEMENT
Part A
The average price in the England and Wales was taken into consideration for the purpose
of the analysis in the movement of the price level of these real estate prices. The trend period
taken into consideration was for the period of 1999-2018. The various parts of England and
Wales was taken into consideration for the purpose of the analysis and relevant analysis on the
same basis was done. Various factors should be taken into consideration for the purpose of the
analysis. Both the business and the macro economic factors affect the movement of the real
estate industry in the England and Wales. Factors affecting the movement of the prices of the
real estate industry were the change in the political, social and macro-economic environment
under which the operations of the company is based. Real estate industry is highly volatile with
the changes in the overall economy rate and is highly correlated with the performance of the
economy (Choudhry 2018). The correlation of the performance of the economy and the real
estate industry is high. After analysing the given data for the given time period it is key to note
that the house price movement in the trend period has shown a growth of about 6%-7% (Hines
2017). While analysing the various parts of England that showed a growth trend it was key to
note that the real estate price in the London was the highest which has been due to the positive
factors like better connectivity, infrastructural facilities, growth and overall development. Real
estate prices in London showed an average growth rate of about 8.22%. While prices in the
North East England showed the lowest, price movement in the trend period and moved an
average by about 5.67% in the period (Tan et al. 2018).
Growth in Real estate prices in England was around 6.75% however on the other hand
side the growth in the Wales Region was around 6.06%. Various factors and environment under

3BUSINESS MANAGEMENT AND STRATEGIC MANAGEMENT
which the real estate of England and Wales operates directly influences the real estate price.
Performance of Economy, Property Markets, Infrastructural development, Inflation rate, interest
rates and various other key factors are some of the key factors that affect the overall price
movement in England and Wales. On an overall basis, the real estate prices in the England and
Wales have been stable with a growth trend of 6.70%, which has been well consistent with the
price movement of the various regions of real estate prices (Haynes, Nunnington and Eccles
2017).
Particulars 1999 2005 2011 2017 Growth(%)
England and
Wales 70,000 155,950 177,000 225,000 6.70%
England 71,000 158,000 180,000 230,000 6.75%
North East 50,000 105,000 118,500 135,000 5.67%
North West 52,500 116,000 127,500 154,950 6.20%
Yorkshire
and The
Humber
52,000 118,000 130,000 155,000 6.26%
East
Midlands 56,000 130,500 136,950 175,000 6.53%
West
Midlands 59,950 133,000 144,000 177,000 6.20%
East 73,950 168,950 190,000 275,000 7.57%
London 111,000 228,000 292,500 460,000 8.22%
South East 89,000 190,000 224,500 310,000 7.18%
South West 71,000 169,950 185,000 239,000 6.98%
Wales 52,000 124,000 130,363 150,000 6.06%
Part B
 Actions by Government affecting flow of money: Government decisions affect the
flow of money between the low-income household group and high-income household

4BUSINESS MANAGEMENT AND STRATEGIC MANAGEMENT
group. Fiscal Policy is the key policy in which the Government decides various factors
and conditions that influences the economy in various ways (O'connor 2017). One such
key government decision that would affect the household will be the reduction in the tax
rate by the government. The flow of money would be affected if there is a reduction in
the tax rate that would be directly affecting that would transfer the income flow from
government to both the household groups (Cimadomo 2016). Higher savings in the form
of lower tax rate would be directly increasing the cash flow level in an economy. It is
essential the policies and actions taken by the government to be analysed that would be
directly affecting the level of operations in the economy. Fiscal Policy is the key policy
that is controlled and influenced by the government thus the policy should be balanced
one that would provide a stable business and macro environment for all.
 Secondary effect of government decisions: The secondary effect of the fiscal policies
undertaken by the government would be directly affecting and influencing the level of
activities in the economy. The reduction in the tax rate in the economy would be directly
affecting the level of cash flow in the economy (Bergman, Hutchison and Jensen 2016).
The cash flow will be flowing directly from the government to the direct consumers that
would be positively influencing the level of income of the household group. Government
would be reducing the taxation rate whereby the level of cash flows would be increasing
in the economy. High level of income household would then have to pay a lower rate of
tax and the low level of the income group would be savings tax amount in the form of
lower effective tax rate.

5BUSINESS MANAGEMENT AND STRATEGIC MANAGEMENT
Part C
Various factors that would be affecting the level of operations are the changing
economic, political and social factors was studied in the assignment. The relationship between
the individuals and household in the economy was also studied. However, Financial Planning
and concepts should be more studied in a detailed manner. The financial decisions made by the
households are inevitably affected by the changes in the environment and the importance of the
financial planning was also taken into consideration for the assignment. Changes in the financial
services industry is not static and the importance of the same in the growing and developing
economies should be also taken into consideration. Changes in the public policy was also taken
into consideration in the analysis. Financial decision should also be undertaken by incorporating
various factors and environment so that the same are incorporated in the decision making
process. The relationship of the financial factors also need to be incorporated into the analysis.

6BUSINESS MANAGEMENT AND STRATEGIC MANAGEMENT
References
Bergman, U.M., Hutchison, M.M. and Jensen, S.E.H., 2016. Promoting sustainable public
finances in the European Union: The role of fiscal rules and government efficiency. European
Journal of Political Economy, 44, pp.1-19.
Choudhry, T., 2018. Economic Policy Uncertainty and House Prices: Evidence from
Geographical Regions of England and Wales. Real Estate Economics
Cimadomo, J., 2016. Real‐time data and fiscal policy analysis: A survey of the literature.
Journal of economic Surveys, 30(2), pp.302-326.
Haynes, B., Nunnington, N. and Eccles, T., 2017. Procurement: Selecting appropriate real estate
options that support the strategic and financial requirements of the corporate occupier. In
Corporate Real Estate Asset Management (pp. 118-172). Routledge.
Hines, M.A., 2017. International real estate investment. In The Most Important Concepts in
Finance. Edward Elgar Publishing.
O'connor, J., 2017. The fiscal crisis of the state. Routledge.
Tan, L.M., Arbabi, H., Li, Q., Sheng, Y., Tingley, D.D., Mayfield, M. and Coca, D., 2018.
Ecological network analysis on intra-city metabolism of functional urban areas in England and
Wales. Resources, Conservation and Recycling, 138, pp.172-182.

7BUSINESS MANAGEMENT AND STRATEGIC MANAGEMENT