Analysis of Housing Market in Australia: Demand-Supply Dynamics

Running head: ECONOMICS ASSIGNMENT
Economics Assignment
Name of the Student
Name of the University
Author Note

1ECONOMICS ASSIGNMENT
Table of Contents
Introduction................................................................................................................................2
Essence of the story....................................................................................................................2
Economic Interpretation.............................................................................................................3
Housing as a resource.............................................................................................................3
Housing Market in Australia..................................................................................................4
Recommendations and conclusion.............................................................................................6
References..................................................................................................................................7

2ECONOMICS ASSIGNMENT
Introduction
The term “market”, in the conceptual framework of economics, as a separate
discipline itself, refers to the platform where the buyers and the sellers of different
commodities or service come to interaction with one another in order to take mutually
accepted decisions regarding the quantity as well as price of the products dealt with in the
concerned market. Thus, the price of commodities and services highly depend on the
dynamics and inter-relation of the demand and the supply forces existing in the market for the
same (Rios, McConnell and Brue 2013). A market reaches an equilibrium situation when the
demand and supply forces mutually interact and reach to a mutually agreed situation, where
the demand equates the supply of the same. Any deviation from that, causes distortions in the
market in terms of mismatches between demand and supply.
Keeping the importance of demand and supply conceptual framework in economics,
the concerned report tries to analyse the situations arising in the market for one of the capital
resources, that is the housing market, in the economy of Australia in the contemporary
period, thereby analysing and interpreting the issues cropping up in the housing market in the
light of the demand-supply theory in economics. To study the issues in the concerned market,
the report refers to the article named, “Housing supply and demand in balance: Fitch”
(Abc.net.au 2018).
Essence of the story
As can be seen from the assertions of the article, in the contemporary period,
Australia has been experiencing a consistent increase in the supply of new housing assets,
with more numbers of homes being built, compared to that of the extent of demand for the
same. However, the article taken into consideration also asserts that the supply increase in the
housing market of Australia is much low compared to that of the increase in the housings in