Factors Impacting Price of Private Housing with Demand & Supply Analysis

Economics For
Business

Table of Contents
INTRODUCTION ...........................................................................................................1
MAIN BODY...................................................................................................................................1
TASK 1............................................................................................................................................1
1. Factors that impact price of private housing with the help of Demand & Supply analysis.....1
TASK 2............................................................................................................................................6
1. Economic policy that formulated to stimulate the demand for private housing in the UK.....6
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Economics for business suggest to the monetary arrangements just as financial concept
which helps the undertakings and a few factors contributed so as to broaden the authoritative
structure. Fundamentally, financial hypothesis dependent on customer's request just as item
provided by the makers (Bogdanović, Vetráková and Filip, 2018). With the assistance of applied
financial aspects, business ready to comprehend the connection between capital, work or item
showcase. It help the associations to break down market which further give advantages to the
administrator at the hour of figuring methodology through examining request and supply of
products in the market. This project report cover various topics such as identify the factors which
help the researchers to identify how demand & supply affect the goods & service. In order to
boost demand, what economic policies develop by the government. It further beneficial for the
construction industry to formulate strategy and make sure that how price will impact the demand
of private housing,
MAIN BODY
TASK 1
1. Factors that impact price of private housing with the help of Demand & Supply analysis
Economics suggest to the different speculate which made for the examination of
demand and supply of item in the market among the shoppers. It helps the association in basic
leadership procedure and future systems. So it is essential to dissect the whole market and
comprehend the request just as supply of the item in the market (Davidson and Davidson, 2016).
So before defining nay start for the business, chief comprehend the economic situation, buyer's
interest, monetary approach and so forth.
Law of Demand: It is an economic theory which help the organization to evaluate the
market trend of any product along with its demand among the consumers. According to demand
law, price and quantity has inverse relationship like, when product price increases then demand
of goods decreases. On the other hand, when price decreases then demand automatic increases
due to inverse relationship (Law of Demand, 2019). other than price, all the factors are constant
but in long run all the factors affect the demand of commodity. In the UK, there are various
factors which affect the price of private housing which further impact the demand of customers
regarding housing.
1

Demand curve is the graphical representation which shows that how demand will affected
due to change in product price. Because price and demanded quantity have inverse relation, so
when price increases, demand decreases and vice versa. Below mention graphical representation
will provide better understanding.
Illustration 1: Demand Curve, 2019.
(Source: Demand Curve, 2019)
With the help of above demand curve, readers able to understand the relationship
between price or demanded quantity. Q denote the demanded quantity, P represent the price of
private housing and D is for demand curve. In the UK, in context of price of private housing
when it increases from £200,000 to £250,000 then demanded quantity of housing reduced Q to
Q1 and vice versa.
There are various factor which impact the price of private housing in the UK which
impact the demand also. So UK marketers have to analyse these factors and make sure to
consider into their business strategy. Some of the factors discussed below:
Factors that impact the demand of private housing:
 Affordability: When individual can afford to buy new house then it will increases the
demand of consumers or make then able to increase predictability of an individual
(Elgelal and Noermijati, 2015). At the time of growing economy, demand of private
2