Demand and Supply: Australian Housing Market

Running head: DEMAND AND SUPPLY: AUSTRALIAN HOUSING MARKET
Demand and Supply: Australian Housing Market
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1DEMAND AND SUPPLY: AUSTRALIAN HOUSING SECTOR
Table of Contents
Introduction......................................................................................................................................2
Housing Market...............................................................................................................................2
Economic Interpretation..................................................................................................................4
Policy Recommendations................................................................................................................6
Conclusion.......................................................................................................................................6
References........................................................................................................................................7

2DEMAND AND SUPPLY: AUSTRALIAN HOUSING SECTOR
Introduction
In economics, the demand and supply are two key concepts, which determine the
dynamics in the markets. The mutual interactions of the demand and the supply forces of the
commodities and services in concern determine the equilibrium in any market, in terms of
economics. While the demand side in the market shows the willingness of the buyers, backed by
their purchasing power, the supply side in the market shows the willingness of the sellers to sell
their products at different levels of prices (Rader 2014). The stability of the markets, in real case
scenarios, are considerably affected and determined by the demand and the supply forces
working in the market. Keeping this in consideration, the report takes into account the demand
supply dynamics of the housing market, taking reference to the article, “Housing supply and
demand in balance: Fitch”, written by Michael Janda (Abc.net.au, 2017).
Housing Market
Productive resources, which are scare and valuable, are of four types in terms of
economics, namely, labour, capital, land and entrepreneurship. Capital resources, in this context,
include any type of investments done in an economy. Investments can be of different types, of
which, residential investment is one significant variant. This has been especially true in the
contemporary periods (Dasgupta, Lall and Lozano-Gracia 2014). This is because in the recent
periods, residential properties are considered not only as housing facilities but also an alternative
form of investment and asset buildup for their long term well being. Thus, the dynamics in the
housing market of a country shows the overall economic condition of the concerned economy as