Housing Market Assignment (Solution)
21 Pages5504 Words248 Views
Added on 2020-10-05
Housing Market Assignment (Solution)
Added on 2020-10-05
ShareRelated Documents
Housing Economic
Table of ContentsINTRODUCTION...........................................................................................................................1MAIN BODY...................................................................................................................................1A) Theory of competitive markets and features of these markets. Demand and supplyfunctions and explanation of subsides in demand and supply through curve........................1(B)Explanation about the economic welfare and state intervention in market. The variousreasons for intervention in housing market............................................................................5(c):...........................................................................................................................................6(D) Financial and economic challenges among the social housing organization and their recentand current policy which changes their business plans........................................................11CONCLUSION..............................................................................................................................15REFRENCES.................................................................................................................................16
INTRODUCTIONThe housing economics is the use of economics techniques in housing market (Anundsenand Jansen, 2013). The assignment covers the study of economics of housing and the influenceof broader economic policy on housing and Understand the effects of housing finance on housingorganisations. It also explains the basic economic theory to analysis of housing demand andsupply problems. It includes housing finance and the relationship between national housing fiscalpolicy and local impacts. Explanation about the theory of competitive market which explain thesupply and demand subsidies. Govt. Intervention in the housing market. Housing market is amarket of houses where buying and selling activities related to housing are performed. In thismarket the physical exchange will not be take place. The price is determined in this market bymany factors like, economic growth, location, connectivity. The law of demand and supply alsohelps in the price determination in the housing market. The social housing organization also plays an important role in housing market. These socialorganizations supported by the national housing federation. It provides the financial support tothese organizations and called the voice of these. These housing organization protect childrenfrom abuse. The housing finance plays a major role in the housing market. The council ofmortgage lenders plays major role in it. The council provides the support in the way of policywhich improves the buying and selling process in housing market. The analysis of competitivemarket theory helps to make this assignment more understandable. MAIN BODYA) Theory of competitive markets and features of these markets. Demand and supply functionsand explanation of subsides in demand and supply through curve.There are various theories in competitive markets and many principles and appreciationsof economic policies make these relevant for the housing market. The explanation about theseterms as follows: Basic principle and apperception of economic policies: The three main policies are constructed by the policy makers (Ball, Lizieri andMacGregor, 2012). These are fiscal policy, monetary policy, supply side policy. Fiscal policyrelated to the Govt. spending and taxation. Monetary poly related to money supply. Supply1
related policy related to increment in the productivity in the economy. These policies also effectthe housing market widely in the country. Monetary policy effect the finance of housing market.The economics of housing consumption, allocation and production:The consumption of housing is also depending on the income of household (Biswas,2012). Allocation and production also affect the pricing of housing market. The householdproduction model also plays a major role in production and allocation strategy. The consumptionalso depends on pricing of housing market. Theory of competitive market:The perfect market is defined as the best general equilibrium theory of prefectcompetition (Whitaker and Fitzpatrick, 2013). In that situation the quantity supplied of a goodand services equal to the quantity supplied at given price. In such market the MC=AR. In thatsituation production also depends on the consumer preferences. In the short run, MC=AC andprice will also equal to these (P=MC=AC). Only in the short run can a firm in a perfectly competitive market make an economicprofit. In perfect competition, a firm can't earn economic profit. The shutdown point also mustconsider by the firm that if it operates the business in market at a loss or profit. If it operates atloss it must be decide whether it should be continuing or not. The short run curve in thatsituation also called cost curve. The firm receive the normal profit in long run at equilibriumsituation. Supply and demand are the price determinate in the market at that time.Demand & supply: Demand refers that how much quantity of a product or services by a consumer desired orwillingness to quire. Supply refers to the quantity existence of a product or services in themarket. Law of demand and supply:The relationship of demand and supply effects the price determination in the market for aproduct (Caldera and Johansson, 2013). Because the law is used for the price determination forproposed product or services. When the quantity of houses delivered fast then its pricesdecreased. Because supply increases then according existence of unchanged previous demandprices decreased. 2
Housing market and its distinct features: The market refers to the place where buyer and seller perform their activities related tothe housing. The physical exchange doesn't exist in these markets it often refers to thePerformance of housing market index but not itself. The housing market effect the economy also.It affects the economy in the way of wealth affect and economic growth. Because the highercontraction in the housing prices affect the economy's growth. The U.K. housing market coversthe accommodations such as owner occupied, private rented, housing association, local authorityhousing (Crook, Henneberry and Whitehead, 2015). There are prices differ according to theregions in country. These regional differences also effect the labour mobility in housing markets.There are some features of these housing markets as follows: These market emphases more on the private sector.The common empirical frameworks are adopted by these markets.These consider more flexible housing financethe emergence of private owned residential units are the basis of these markets.Determinates of prices in housing market: The housing market prices are determining by some factors like demand and supply,economic growth, location, room to move from one to another, a common bathroom, parking,echo friendly situation. Apart from that many more factors also affects the pricing strategy. Andprice affects the allocation and consumption of houses to households. Distinguish between supply and demand subsidies: The subsidies rewards or benefits given by the Govt. to a manufacturer of a product orservices it can be of two types first one demand subsidies and second one is supply side subsidies(Dieleman, 2017). These subsidies are used to reduce the regional difference in prices. Demandsubsidies also known as rebates. For example, if Govt. provides subsidies to a scooter producerin money than it known as supply side subsidies. And if it provides in the way of refunds then itwill demand side subsides. Effect of supply subsidies:The supply curve shifts right side from existing when there is a supply side subside anddemand curve remains same. 3
End of preview
Want to access all the pages? Upload your documents or become a member.
Related Documents
Economics for Business: Supply and Demand in the UK Food Industry during COVID-19lg...
|14
|3477
|98
(PDF) Financial Markets and Monetary Policylg...
|13
|3241
|29
Sample Assignment on Economicslg...
|11
|1920
|41
UK Food Supply Challenges in 2020lg...
|15
|3462
|91
Introduction to Economics for Businesslg...
|14
|4043
|250
Economics for Business: Supply and Demand Principles in the UK Food Market during the Pandemiclg...
|12
|3010
|37