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The UK House Price Crisis

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Added on  2021-04-24

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Running Head: ECONOMICS FOR BUSINESS ECONOMICS FOR BUSINESS 2 2 Economics for Business Name of the Student Name of the University Author note Introduction 2 Trend in UK house prices 2 Factors affecting housing price 4 Demand side factors of UK housing market 4 Supply side factor of UK housing market 8 Implication of Housing shortage 10 Different government schemes in the housing market 11 Help to Buy 11 Shared Ownership 12 Conclusion 13 References 15 Introduction The analysis of housing market of UK is an interesting aspect for several reasons

The UK House Price Crisis

   Added on 2021-04-24

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Running Head: ECONOMICS FOR BUSINESSEconomics for BusinessName of the StudentName of the UniversityAuthor note
The UK House Price Crisis_1
ECONOMICS FOR BUSINESS1Table of ContentsIntroduction................................................................................................................................2Trend in UK house prices..........................................................................................................2Factors affecting housing price..................................................................................................4Demand side factors of UK housing market..........................................................................4Supply side factor of UK housing market..............................................................................8Implication of Housing shortage..........................................................................................10Different government schemes in the housing market.............................................................11Help to Buy..........................................................................................................................11Shared Ownership................................................................................................................12Conclusion................................................................................................................................13References................................................................................................................................15
The UK House Price Crisis_2
ECONOMICS FOR BUSINESS2IntroductionThe analysis of housing market of UK is an interesting aspect for several reasons.Housing market in UK holds a pivotal position in the economy. As compared to otherEuropean nations UK has a much higher owner occupation rate. In 2011, UK’s owneroccupation rate was 70% as compared to a rate of 45% in Germany and 56% in France. Thehousing price in UK has constituted a steady upward trend in the last few years. The housingmarket experienced two biggest bubble during world crisis of 1980 and 2008 (Wilcox andPerry 2014). The price showed an upward trend from 1995 to late 2000 and suddenlydeclined in the phase of crisis. The bubbles are mainly caused by ease of bank regulation andrestricted supply resulted from restriction imposed on land. Different demand and supply sidefactors together determine housing price in UK. These factors include cost of construction,affordability, supply of credit, disposable income and others. The affordability of people andhence housing prices are also influenced by different government schemes such as Help tobuy scheme, Shared Ownership, Starter Homes Scheme, right to buy and others (Kuttner2014). The report evaluates factors affecting UK housing price from 2006 to 2016.Additionally attention has been also given on impact of different government schemes onhousing price. Trend in UK house prices
The UK House Price Crisis_3
ECONOMICS FOR BUSINESS3Figure 1: UK annual house price for all dwellings(Source: ons.gov.uk 2018)In 2016, the average housing price in UK has increased by 8.7%. The housing pricecontinued to maintain a steady growth since 2013. The average housing price during this yearwas £214,000. The average price is higher by £17,000in 2015 (telegraph.co.uk 2018). Figure 2: Average housing price in UK(Source: ons.gov.uk 2018)
The UK House Price Crisis_4

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